(Montel) Norwegian fertilizer giant Yara has signed the world’s first binding commercial agreement on cross-border CO2 transport and storage with Norway’s Northern Lights.
The deal would “kickstart the commercial market for carbon capture and storage (CCS) in Europe,” the firms said on Monday, after agreeing to it in principle in August.
It was also “groundbreaking” for decarbonising European heavy industry, Norway’s energy minister Terje Aasland told the European Hydrogen Week conference in Brussels late on Monday.
It opened the market for cross-border CO2 transport and storage as a service, he said, adding that the North Sea was “open for storage business”.
The deal was important for Longship, the first full-scale CCS project in Europe, said Aasland, who also attended the signing.
Northern Lights is the transport and storage part of the Longship project, funded 80% by the Norwegian government.
North Sea storage
Under the agreement, CO2 captured from Yara Sluiskil – an ammonia and fertilizer plant in the Netherlands – will be shipped and stored under the seabed off the coast of western Norway.
From early 2025, 800,000 tonnes of pure CO2 will be captured, compressed, and liquefied in the Netherlands, and then transported to the Northern Lights store at 2,600 metres under the seabed off the coast of Oygarden.
“This is a milestone for decarbonising hard-to-abate industry in Europe,” said Yara CEO Svein Tore Holsethe on Monday.
Norway had the potential to provide Europe with significant CO2 storage, helping it reach its climate targets, added Northern Lights managing director Borre Jacobsen.
The Norwegian government’s funding conditions for Northern Lights require it to develop a commercial business model and offer its service to the rest of Europe.
Northern Lights JV DA is owned equally by Equinor, Shell and TotalEnergies.
The EU wants to cut its CO2 emissions by at least 55% from 1990 levels by 2030 and have a net-zero carbon economy by 2050.