SPE Live Podcast: MENA CCUS at Scale - From Projects to Bankable Storage Hubs

Speaker A: Welcome to the SPE Podcast powered by the Society of Petroleum Engineers. You're listening to SPE Live. Middle East CCUS at Scale From Projects to Bankable Storage Hubs. The audio from this episode was previously recorded on 7-1-2026.

Speaker B: Hello and welcome to this spelive titled Middle East CCUS at Scale From Projects to Bankable Storage Hubs. My name is Christian Winterfield. I'm a lead petroleum engineer for CCS at Aramco and and current chair of the SPE CCUS Technical Section and uh, I'll be today's moderator. Today's SPE Live will last approximately 30 minutes and I'd uh, encourage you to submit your questions in the chat during the program. CEU and PDH credits and certificates of completion are available by watching this episode on the SPE Energy Stream website, free to all SPE members. SPE Live episodes are available for free on LinkedIn for 24 hours after the live show, but neither credits nor certificates of completion will be provided via via this platform. It's now my pleasure to introduce our guests for today. Bilal Sheikh leads business development for CCUs at ADNOC focused on advancing large scale carbon capture storage and low carbon energy initiatives in Abu Dhabi. He works on originating and commercializing CCUS projects in collaboration with industrial partners, utilities and government entities. Our ah, second speaker Kuman Hagi is an accomplished energy leader with over 20 years of international experience across Europe and the Middle east leading high value consulting and delivery programs across oil and gas, ccus, hydrogen and digitally enabled optimization and decarbonization. Bilal and human, welcome to this SPE Live.

Speaker C: Thank you Christian, SPE and the organizing committee to arrange this interesting discussion. Uh, I want to start by just giving a brief introduction on ADNOC CCUS journey. In 2009 we became the first energy company in Middle east to pilot CO2 injection. And then in 2016 we built Alriada which was a CCUS platform that took CO2 from a steel company, transported it to our oil field where we use it for EOR enhanced oil recovery and that's about 800,000 tons per year. Since then we have FID 2 projects um, and these projects are currently in construction, Halangash and Afshan and they will be coming online next year. That takes our capacity to 4 million tons per annum uh, when those projects come online. Another big achievement from ADNOC in the last uh, couple years has been our uh, full uh value chain, uh uh, certified low carbon ammonia shipments to Japan. So this was enabled by ccs. Uh we had Third party certifier to certify the whole value chain. And then that ammonia was used in Japan in 100% ammonia gas fired turbine. Looking forward we plan to scale up in the gigatons and that's why we need CCUS hubs. Um, and that's very similar to our uh, regional uh, companies like Aramco building the Jabil CCS hub and Oman building their CCS hubs in their country. So I look forward to this important discussion on this topic. Thank you.

Speaker B: Thank you. Bilal Hooman, opening remarks from you.

Speaker D: Hi Christian.

Speaker B: Hi everyone.

Speaker D: Thank you for the opportunity. It's a delight to be part of uh, this panel discussion with you all. Christian, could you please confirm if you can hear me?

Speaker B: Well I can hear you loud and clear human. Thank you.

Speaker D: Love it. That's uh, excellent. Thank you so much. Uh, my name is Herman Hagigi. I am actually new in the Middle east and Abu Dhabi. I moved from our offices in Aberdeen, Scotland to Abu Dhabi like less than a month, less than a year ago. And uh, I've been impressed by how much investment has gone through the Middle east and CCUS value chain. And I honestly believe there are significant opportunities in the Middle east that uh, maybe compared to other regions could help scale up CCS projects and uh, potentially pass FIDs sooner and quicker uh, than other regions. If you look at the statistical data, uh, since 2015 only 12% of project capture project that has been announced passed by across the globe. Mainly in Europe, mainly in America. And um, I'm really hoping that by investing in the Middle east and my talking about the possibility of scaling up CCS projects and making these projects more bankable, we can actually create a new industry for ourselves in the Middle East. Thank you for having me.

Speaker B: Welcome home. We will launch into our questions then. Um, our first question from your experiences, uh, what are the key technical or commercial differences between standalone CCUS projects and integrated hub based developments? Perhaps we'll start with you Bilal and your thoughts.

Speaker C: Sure. Uh, so first uh, just give a quick uh, difference between standalone and uh, hub based project. So uh, a standalone project has one emitter and then you have one transportation company and one storage company or one transportation and storage company. And that's the case uh, for example in Abu Dhabi here with ADNOC providing the transportation and storage operator portion uh, of that uh, and that's very similar to Alriyala which is ah, we have a steel company that's the emitter and then the CO2 pipeline that Adnoc built is being, is used to transport CO2 to the sink in the oil fields. Um and that's a important point is that's fit for purpose. Another emitter cannot really tap into that because the capacity is already uh, designed for only one emitter. The hub concept is very important. Um, it enables multiple emitters to benefit from the CCUS infrastructure. So what's very important is that you have multiple emitters, you have a common trunk line and you have a shared storage space. Um now this is great but it introduces a lot of challenges, both technical and commercial. Uh, from technical perspectives you have to have a standardized CO2 spec. Um because you have different sources of CO2. Some are post combustion, some are processed CO2. Um, they all come with different impurities. So you have to have limits on those impurities in the spec. Um and you also have to have a very good control uh, on the pressure and temperature of the CO2 as it enters the network. Um and so that, that, that planning beforehand and helping the emitters understand those requirements is very, very important as they start to look into their investments for uh, CO2 capture. Um the other important part is that you have to look at the, the, the infrastructure and oversize it. Um you typically have this anchor tenant who's uh, going to start um and then, but the, but the infrastructure cannot be built just for that tenant. It has to be oversized to the other uh, emitters who are also in the vicinity in the cluster can also benefit from this infrastructure. That is challenging because if you overbuild you can run empty for many years, may not get the payback you need. Um and if you are under building then um, you will not be able to onboard the next uh, client or uh, the number of clients you would like. Uh so that's a very important uh challenge that has to be uh, carefully uh, uh resolve as you develop the hub infrastructure. We can get into those details a little bit more later. Um, also another important distinction is also the storage. Um ah, when you have uh, the storage for a hub it has to be on the aggregate volumes which are much much greater than if you had a single emitter. So the certification is more challenging because you're talking a lot more volumes over a 25 year period and so on. So the uh, certification requires you to make sure you certify the full uh, uh hub capacity worth of volumes when you certify your storage. So that's also a very important uh distinction. Uh commercially, um, a standalone is very simple. Once you have your offtake agreement between emitter and the transportation storage Company you can basically fid the project based on that. Um, whereas definitely um, when it comes to hubs you have many counterparties, you have, you uh, need an anchor invest investor obviously. And uh, this one the investor has to be in order for to be bankable, someone who's very, has a good uh, who's credit worthy. Um, and you have web of transfer, transportation and storage agreements and you have challenges in the tariff, who pays for the oversizing and so on. Um, but all of that I just want to just end with this point that all of that is worth it. Uh because if you build a properly designed hub for all the emitters in the region, you benefit from the economies of scale that lowers the per unit cost of the CO2 Transportation and Storage. And everybody benefits. Even with those who uh, are trying to decarbonize with tight margins as they are with the hard to evade sector.

Speaker B: Thank you. Bilal Human. You have a lot of experience uh, in Europe, uh, in uk uh hubs. Anything to add here?

Speaker D: I mean Bilal response was very comprehensive. Maybe I can look at it through a different angle. Um, just to add uh, just to add an extra dimension to what Belal said. You know the traditional CCS projects that we have, the ones that is operating at the moment, as Bilal mentioned, they are vertical CCS jobs, they are standalone projects, they are points to point type CCS projects. As it stands right now, the majority of the operational ones, that's the way it works. You collect CO2 from molometer, you transport it not far away, you store it in a sequestration site. The risk of investment is um, with one potentially almost uh, limited number of investment investors. And the whole operations rely on operability and the input from just limited companies, limited stakeholders. That makes things a little bit easier one might say through the lens of design. There are not multiple stakeholder management. The challenge is easier. The drivers are very similar but at the same time these projects are a lot more expensive. Very similar to oil and gas. If you scale up a project, if you go for a larger project, the levelized cost or the cost per unit of gas or oil that we produce is going to be significantly less. But obviously as Bilal mentioned, by scaling up those projects, going for industrial clusters, sharing the risks between multiple investors, stakeholders, operators, asset owners, we basically enable those projects because it's not just you know, to put all the eggs in one basket really. Um, but by doing this we make these projects the levelized cost of CO2 or the cost of CO2 per unit of uh, mass or volume of CO2 is going to be less. It would help the projects to be more bankable. But it comes with its own technical challenges. Bilal mentioned about, you know, the requirements of the CO2 from multiple emitters. This topic that we are going to discuss together, operability of these projects come with the own challenge. These are the areas that you don't have the experience of. These are all new. This is a novelty and very similar to any technology evolution. At the beginning it's going to be more expensive, it's going to be more challenging. The more you do it, we are going to be better at it and we are going to make it more efficient. Thank you.

Speaker B: Uh, thank you and Bilal for your comprehensive answers. Um, Herman, you briefly touched on the risks associated there. That leads nicely into our next question which I'll direct to you initially and then Bilal can respond is what are the main risks associated with transitioning from that pilot scale up to commercial scale hubs? Um, and how can we mitigate these early in the project design? You have a lot of experience with wood, um, with project design. How can we mitigate the risks early, Particularly in relation to that integration piece between our uh, capture, transport and storage?

Speaker D: I mean absolutely spot on. I think this is super important question. In reality, very similar to any scale up project innovation technology. It comes with its own challenge. It's new. We need to be aware of the challenges. Sometimes we don't know what we don't know. And um, addressing challenges associated with unknown unknowns is going to be difficult. Even through the lens of design code and standards, even through the lens of tools that we use. I think those tools are very limited. They've never been tested for such environments. And that's why we as an industry, we are investing in the right code and standards, right practices to design larger CCS industrial hub based type projects. But at the same time, you know, I guess there are areas that we can do better. So obviously chain integration as you mentioned is one of those topics. When you deal with multiple stakeholders. Any disruption at any node within that larger value chain potentially can cascade through the entire value chain. So one of the stakeholders, you know, making mistakes somehow, somewhere and it would impact all of us in a way. All the other, the entire elements of that value chain, the majority of the operations are very dynamic. Like the emitters are operating in a very dynamic environment. They collect captures in a very dynamic environment. But the reliability of the CO2 injection rates and operability of the field of the system itself would rely on, you know, a control flow Rate across that larger value chain, control pressure, balance across that value chain. And if for any reason any of those emitters are not live or not able to provide the CO2 at the rate expected, it would impact everybody else. And not all these emitters are going to be live from day one, like not all of them are going to be available from day one. So you have to design a system, as Belal said, sometimes oversized because you are looking at the phase two, phase three of the project, then you scale up. But it comes with its own challenge because you might not actually have enough CO2 at day one. And even if you have enough CO2 at day one, you never know. Sometimes these emitters are going to stay live or are going to provide the CO2 for long term. We are going through decarbonization. Industry is quite competitive. Not all these emitters are going to stay live for a very long time. But beyond that, through the lens of technicality Bilal mentioned about fluid specification, you're collecting CO2 from multiple sources. These nasties that they come from different CO2 sources, they have different characteristics in vertical CCS jobs. The one that we mentioned earlier on, we are not concerned about it. We are capturing CO2 from an emitter, we are transporting it and it's been working fine for us so far. The problem is the coexistence of those nasty components coming from multiple CO2 sources. The technology that we apply might not remove all those nasty components of interest. Based on the latest research that we all as an industry have done in the larger future CCS project, we can expect more than 36, up to 36 different impurities that uh, could potentially have a major impact on operability and integrity of those uh, facilities. Looking at statistical data, the majority of the incidents where CO2 was released to the environment through the lens of HSE, through the lens of integrity, are potentially related to malfunctioning of control system to protect the system corrosion, either internal or external, that lead to, you know, CO2 leakage today to the environment itself. And those challenges are going to be even bigger challenges in the future because we are dealing with nasty components coming from multiple. So there are some challenges. It needs research, it needs data to be generated, works to be done and it needs collaboration. Thank you.

Speaker B: Thanks. Herman. Bilal, your thoughts on um, risks associated with transitioning from pilots to commercial scale.

Speaker C: The only thing I would like to add uh, is actually the benefit of commercial pilots. Like ah, we actually had a commercial pilot where I talked about the low carbon ammonia pilot. Um, we injected CO2 into our saline aquifer and the benefits that we have uh, gained from that pilot are enormous. Um, really, really worth the cost of that. It's quite expensive to do a pilot, um but we think the costs were worth it. Um, we understood how to do a full uh, value change, life cycle assessment, third party certification requirements which are very, very stringent. Uh, uh, in understanding all that, developing the right digital platform for the M and B, um, you know, understanding your monitoring and injection requirements for and you get a better understanding obviously of your subsurface. You de risk a lot with that pilot. Uh, so we've benefited a lot. And that's something that the commercial pilot does. When you're ready for large scale implementation, the commercial, the learnings will definitely um, support a uh, very good efficient execution.

Speaker B: Thank you. Bilal. I mean I guess drawing on your experience Bilal in the commercial space, um, what do you see as the key conditions that we need to make CCUS hubs bankable in the Middle East?

Speaker C: Yeah, for a bankable CCUS hub you um, need certain things. List a few. Um, first of all, revenue certainty, um, CCUS must not just be built on sustainability alone. Um it needs a very strong and it must actually stand on this, a strong business case. Now in mena, uh with the absence of carbon price at the moment and uh, there is also the low carbon product globally, uh those markets are still under development. Um so there's not a big demand. We uh, cannot use uh, those uh, ah for revenue sources at the moment.

Speaker D: So what do we do?

Speaker C: We can utilize EOR to subsidize and build the CCUS infrastructure, the transportation and even the storage. When I'm talking about storage, I mean not just storage in the oil field but also storage in an aquifer because uh, the sequestration can be used as a backup when there's an issue, uh in the oil field there's a disruption rather than venting the CO2. Uh you can take that and uh, it goes to the uh, aquifer for permanent storage and also for long term purposes as well. Uh, end of day CO2 injection in an oil field is temporary. Uh and then afterwards we can then start to take that CO2 to AH aquifer ah to store it permanently. Uh so that's one, um, secondly you need strong assurances for the lenders, they need confidence. So the molecule has to be uh, permanently stored and that's a big risk. That's the unknown, uh, will this molecule ever leak? Um so you need a very good uh, third party reputable third Party certifier to show that uh, this particular injection site is uh, following the best practices and standards. Uh, the M and V program is very good. And so uh, that's kind of what we did here with uh, using DNV to certify our aquifers. Um, thirdly, uh, you need a very good bankable contractual structure. And that means long term transportation storage agreements with an experienced operator. So a company that's been doing this uh, helps obviously give the confidence to the lenders. Um, and you also need a strong credit worthy anchor tenant. Um because a lot of the development of the project depends on this uh, anchor tenant. Uh, you need a very good MRV program, uh, that brings the trust in the entire process. Um, and you also need a very good digital platform that basically makes that whole accessing all the data very easy for everyone, the certifiers, um, and also the operators and so on. Uh, and lastly I would say um, you need clear regulatory and policy uh, framework. Um, now we can say that uh, this is progressing maybe slower than most of it would like, but it is progressing. Uh, so it will come. Uh, in Abu Dhabi we're very happy to uh, have the recent uh, CCUS policy being announced and approved by scafia. So now uh, we have a comprehensive framework for carbon capture utilization and storage. Uh, the Department of Energy will be responsible and um, uh, uh, authorized regulator for this particular activity. And we will be working with them to develop the right CCUS hubs uh, for Abu Dhabi.

Speaker B: Thank you very much. Bilal Herman, I mean you've got experience not only within the Middle east but across, you know, multiple regions in Europe. Um, what are you seeing as key conditions to make projects hubs bankable? Bankable?

Speaker D: I think that's a great question, Christian. I'm going to focus on the Middle east and compare it with the rest of the world, maybe, maybe Europe. And in reality we have some advantages in the Middle east and some disadvantages compared to the part of the world. Obviously our regulation here in the Middle east is not as established as maybe some parts of the world. Potentially Europe for example. Um, and that is super important the whole conversation about carbon credits green premium enabling larger CCS projects by offsetting the carbon intensity of alternative products that we sell premium products to the rest of the Bilal mentioned about low carbon ammonia SAF lng. They can benefit a lot by being coupled with CCS projects to provide premium product and bring money back to that larger investment. So basically coupling CCS projects with low carbon product that we can sell at Premium products can actually be super interesting and make the economy of scale a lot more attractive for Middle east projects. On top of all this we have access to cheap energy compared to so many parts of the world. If you look at the CAPEX and OPEX of a large CCS project, we are talking about 50, 60% of the CapEx to be an OPEX to be on the capture elements of the chain, 40%, 50% on transport and storage. If the cost of energy is less to capture CO2, obviously we can make that project a lot cheaper because we have access to the cheaper energy. Focus on energy integration, optimizing the use of energy could be super interesting. On top of this we have existing infrastructures. We've been producing oil and gas for many, many years. There are so many facilities, there are so many depleted reservoirs onshore, not just offshore, that we can repurpose and make those larger systems, CCS projects a lot more, a lot more attractive and a lot more cheaper. If you compare the cost of an onshore CCS job versus an offshore CCS project, for example Europe versus Middle east, the CapEx, the initial investment could actually be significantly less for us in the Middle east compared to the rest of the world. And um, one more thing to add. Centralized NOCs and their interest in uh, CCS project could make the decision making a lot easier. Easier, quicker, faster in a way. In Europe we do rely quite a lot on incentives. We do rely on um, government support. The process can take longer. We have to make sure that it provides opportunities for all the key stakeholders. But if you are relying on the key national oil companies, national energy companies in the region, the decision is ours. We basically can make that decisions quicker. As soon as this project's bankable and it worth the investment, we can grow uh, quicker at the larger scale. I hope it adds value to the conversation that we had Christian.

Speaker B: Absolutely. Thank you Herman. Um, I've just got one more question for you both before we have uh, a look at uh, um, some of the audience questions and this is something I'm really interested in is looking ahead, what sort of innovations or practices are going to be most impactful, uh, in enabling CCS hubs in the Middle east to become scalable and repeatable.

Speaker D: Christian, would you like me to start or.

Speaker A: Please.

Speaker D: Yeah, no problem, no problem. Maybe I can give a few ideas and I would love to hear from Bilal as well. Obviously there are so many topics that we can talk about. In reality, standardized design and modular capture technology can add a lot of value. As you mentioned earlier on the initial CAPEX investment and the initial CAPEX of a larger scale CCS project is mainly on um, the capture elements of the chain. So if we can have modular based design and if we can have standard design it would allow us to de risk investment. We don't need to go big to start with. We can add to it and we can actually frame and uh, schedule the projects much better. We can actually make these projects a lot more bankable. The second one that I wanted to add is alternative again on the capture piece m on alternative solvents, uh the regeneration processes, membrane units. Not only technologies are applicable to all different CO2 sources, but the expansion and investment in alternative technologies and chemicals would add a lot of value to the success of the CCS project through the lens of innovation. And if I can end with one last one, I know the time that we have is limited. We talked about data um, and how important the data would be for certain certification providing credit to different stakeholders. In reality you're selling data, you source CO2, you certify what you stored and you sell that certification in a way so that data is uh, officially the value of your CCS project. So digital carbon accounting, the use of advanced digital solutions to design and operate those facilities are extremely important. As it stands right now there are not many digital physics based on and data driven solutions out there that has been tested against real CCS projects in the world and that comes with its own risk. You cannot apply technology that has not been tested. The majority of the operating system projects across the world are not digitally enabled and that can help to accelerate if invested it. If you work on the digital solution and data driven approach we can actually scale up the investment uh, and interest in in CCS project quite significantly. Bilal, I would love to hear your views as well on the topic please,

Speaker C: uh, mindful of the time. But I'll just uh, on your last point on the importance of maturing the digital uh platform certification platforms and monitoring platforms. Uh, I heard from uh, a technology uh provider that's really developing some of these platforms. Uh, he said that for northern lights for one CDR certificate they required more than 1 million lines of data uh, as support just for one CDR certificate. So this is not a small thing. It's a lot of data that has to be certified and validated. So a uh, very good uh, uh platform will really uh, enable the business um and so lowering those costs are very important uh and I think that would be very helpful as well. So I definitely agree with you on all your points and Just wanted to add that uh, extra piece of data for, for what you were saying.

Speaker D: Homan, I appreciate it. Thank you.

Speaker B: Great. Thank you gentlemen. Um, we've got time for probably a couple of quick questions. One that is very quick is someone's asked you, Bilal, could you share the size of the pilot plant of Aramco? But I think they might mean uh, ADNOX pilot plant. Ah, and what you've scaled to.

Speaker C: Yeah, so the commercial pilot that was done, um, that was injected uh, about uh, 18,000 tons of CO2. Uh, so it's a pretty significant volume in one year. Um, now uh, we are uh, looking to inject uh, you know, uh, 4 million tons. So that's going to be our current capacity. Uh, by the, by next year we'll have 4 million tons of CO2 that

Speaker A: would be

Speaker C: used for EOR. So it's not uh, what I talked about. The pilot that was actually or um, injection into a saline aquifer. Carbon and aquifer. Hope that's clear.

Speaker B: Thank you. Bilal. Just flicking through again. There's a question here for you Herman. Um, you mentioned about only 12% projects have passed FID since 2015. Um, the question is, is the, the trend if it grew recently or if it experiences a plateau or has it decreased? So where do you see the movement in FIDs going?

Speaker D: Uh, yeah, absolutely. Uh, no problem at all. That's a really good question. I think there is so much going on all across the globe. Obviously you know, the interest in CCS project has gone through its own up and down again very similar to any technologies. Um, so we have to be mindful of that one. In reality, not all the CCS studies that has been done has passed fid. The majority of them actually did not go ahead. And the biggest problem, problem is the bankability of these projects. If these projects were bankable, I mean everybody would have loved to invest in it. But part of the problem is that we see CCS on its own. We try to look at the business model for a CCS project individually in isolation. CCS and um, CCUS projects in reality are enablers. If you want to see the real value of CCS project, you have to see how much extra uh, industries can be enabled. Low carbon production solution products, low carbon product, uh, could be one of the topics of interest. Potentially the possibility of providing premium, selling premium products to the market could be of an interest as well. Uh, in reality in America, so many of the projects are still maybe mainly focused on your base type jobs. There has been a few projects that are shifting to the longer term CCS project. But as Bilal mentioned you are projects largest CCS projects is part of that uh, longer term sequestration conversion and making it more bankable in Europe. I would say the majority if not all the projects are mainly CCS longer term sequestration type investment with the focus on sustainability and reducing emission. And interestingly so many of these projects are actually passing their finances. So you see lots of positive news in Denmark, in the uk, in Norway, in Europe, all across Europe. So so many of these projects are actually going ahead. Maybe the scale and the size of the investment is not as big as we were hoping for but the co investment and sharing stakeholders actually are grabbing a lot of attention. Cross border CCS opportunity in Europe has been a direct interest, has been a big interest for European investors and European stakeholders open access CCS networks. So there are lots of projects going on. Um, I hope it does answer partly the question.

Speaker B: Thank you Herman. Unfortunately we're out of time now. Um, but I would really much like to thank uh, both of you Bilal, um, really great to hear the leaps and strides that are happening um, in the Emirates in progressing projects and that experience is really invaluable uh for the rest of the region in terms of uh, that scale, that scaling from pilots up to large scale projects and the integration of steel plants and other emitters. So um, very grateful for your participation and to Hooman, um also your wealth of experience and knowledge was uh, definitely on show today and we're really grateful for your contributions. Thank you very much everyone.

Speaker D: Excellent opportunity for everyone.

Speaker C: Thank you. Thank you. All yours.

Speaker B: Thank you very much.

Speaker D: Thank you. Have a good day.

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