"Carbon capture and storage," also referred to as "carbon capture and sequestration," or CCS, is regarded as an essential technology to meet the GHG reduction goals deemed necessary to avoid the forecasted irreversible effects of climate change. It is the only GHG reduction method that decouples fossil fuel usage from CO₂ emissions. Carbon capture R&D activities are mostly tailored to coal-fired power plants, the largest stationary source of CO₂ emissions. However, the refining industry, along with other sectors such as steel and cement production, is beginning to investigate CCS as a viable method of reducing GHG emissions. It is thought that, as the price to emit CO₂ rises, these energy-intensive industries will find CCS more worthy of investment. In fact, refiners are already investing to some degree, as is exemplified by work during Phase II of the CO₂ Capture Project, an international collaboration of oil companies. Phase II focused partly on refinery carbon capture developments.

CCS involves the production and recovery of carbon dioxide from industrial processes and is typically followed by drying and compression to approximately 2.2K psi (15 MPa) so that it may be shipped to storage sites via pipeline. The captured CO₂ can be injected into depleted oil and natural gas fields (DOGFs) and saline aquifers; it can be used for the recovery of methane from unminable coal seams and to recover oil and gas from DOGFs; it can be stored in the ocean by various mechanisms; or, alternatively, the CO₂ can be used as a chemical feedstock or for algal biofuel production, among other applications. Carbon-capture methods are commonly grouped into three technological categories: pre-combustion, oxycombustion, and post-combustion.

The predominant advantage of pre-combustion carbon capture is the availability of a high-partial-pressure CO₂ stream for capture. The method consists of converting a hydrocarbon fuel into syngas, followed by water-gas shift (WGS) to produce a CO₂ and H₂ stream from which CO₂ can be separated. For the refiner, this most often refers to the steam methane reformer (SMR), although FLEXICOKER, partial oxidation, autothermal reforming, and gasification units may also be in use in some refining complexes.

Oxycombustion—also called oxyfiring or oxyfuel combustion—refers to combustion with pure oxygen. Its advantage lies chiefly in the fact that, ideally, only water and CO₂ are produced in the effluent stream, which is cooled to condense and remove water vapor. Close to 100% of the CO₂ is captured at purities of 80-98%. Since N₂ is not present in the oxygen feed, NO_X emissions are also reduced by an order of magnitude. In practical application, this technique often requires a CO₂-rich flue gas recycle to limit burner temperatures, which increases energy consumption. Refinery candidates for oxycombustion capture are, in principle, any process employing combustion; although, in practice, only the largest combustion sources of CO₂ would be considered. These emitters include the large boilers associated with the power/steam plant, major process heaters such as those on the CDU and catalytic reformer, and the FCCU regenerator. Oxycombustion requires an air separation unit (ASU) and some level of burner and oxygen injection system modification.

Post-combustion methods are end-of-pipe solutions for industrial combustion processes. Flue gases for post-combustion capture generally have less than 15% CO₂ and are near atmospheric pressure. In the refinery, any combustion exhaust is a candidate, but only the largest, high-partial-pressure sources of CO₂ are practical considerations. Such sources include the FCCU regenerator, the power/steam plant, or any large, combined stack.

The prospect of refinery carbon capture is primarily centered around one question: will the project achieve a desirable NPV? Unfortunately, the associated risks with carbon capture, particularly the unknown cost to emit CO₂, are making this question hard to answer. If refiners had a better sense of the cost to emit or capture CO₂, decisions could be made with greater confidence. In other words, making the decision to capture CO₂ depends heavily on reliably predicting profitability, and much less on technological feasibility. A reliable prediction of profitability will, in turn, depend heavily on accurate cost estimates of capture technologies and confidence in knowing the price of CO₂. The importance of a stable carbon price is exemplified in the case of StatoilHydro's Mongstad refining complex. There, the decision to capture CO₂ has already been made, thanks to a consistent Norwegian CO₂ tax.

For refiners considering CCS, the Report will address five key issues with detailed analyses and recommendations.

Capturability. This study reveals the most favorable capture areas in the refining complex. To this end, we provide a qualitative ranking of refinery units in terms of their prospect for carbon capture, or "capturability." Of course, the unique characteristics of each refinery will play a large role in determining which units are most amenable to capture.

Capture Cost. Cost data for refinery carbon capture is not widely published. Refiners can, however, undertake their own initial studies to prioritize units based on capture cost. We examine two widely-used metrics for carbon-capture cost analysis: cost of CO₂ avoided (C_a) and cost of CO₂ captured (C_c).

Transport, Storage, and Other Costs. The cost of CO₂ avoided (C_a) is generally applied to the emitting unit, although transport and storage costs must be factored in as well. These costs will vary based on the transport distance, the storage method, and the political and business environment of the CCS project. In order to portray some of the cost dynamics associated with CO₂ capture, and to illustrate the point at which refiners might choose to capture carbon instead of paying to emit, this turns to a scenario analysis, correlating cost of total CO₂ produced and refinery CO₂ emissions avoided by capture.

Financial Impacts on Individual Refiners. The total cost of CO₂ will vary depending on a refiner's circumstances. With the right capture technology and CO₂ product value, a refiner may pay $5/mt or less to deal with CO₂. If conditions are ideal, CCS may even be profitable. On the other hand, differing circumstances could dictate a refiner paying $30/mt or more to address CO₂ if carbon prices reach their projected value by 2020. We present the effects of such costs on integrated oil firms, as well as on large and small independent refiners.

Coordinating Capture, Transport, and Storage. Even if a refiner finds the total cost to emit to be small or even negative and wishes to proceed with carbon capture, the initiation of the project cannot occur before transport and storage become available. That is to say, none of the three components of CCS make sense without the other two. To encourage the foundations of transport and storage networks, research activity concerning the technical, economic, and legal aspects of transport and storage is underway. The study discusses their availability and significance to actual deployment of CCS.

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