The European Commission has released the list of companies producing oil and gas in the European Union that are required to build carbon dioxide (CO2) storage systems, including their injection allotments.
The 44 producers listed will help the 27-member bloc reach 50 million metric tons of capacity for annual CO2 injection into geological storage sites by 2030, as established by the Net-Zero Industry Act, which took effect June 2024.
Obligated companies are those that produced crude oil and natural gas in the Union between 2020 and 2023, as specified in Regulation (EU) 2024/1735. The regulation lays out measures to strengthen the EU’s net-zero technology manufacturing ecosystem.
“These projects will accelerate the development of Industrial Carbon Management solutions and play a key role in the decarbonization of hard-to-abate industries across Europe”, the Commission said in an online statement.
The official text of the decision specifying the pro-rata obligations says, “Authorization holders whose combined production of crude oil and natural gas in the Union amounted to 95 percent of the volume of crude oil and natural gas produced in the Union in the period from 1 January 2020 to 31 December 2023 shall be considered obligated entities”.
Nederlandse Aardolie Maatschappij BV, based in Assen, has the biggest obligation at 6.35 million metric tons per annum (MMtpa). It is followed by OMV PETROM SA, which is backed by the Austrian and Romanian states, at 5.88 MMtpa. Romania’s majority state-owned SNGN ROMGAZ SA has the third-largest contribution at 4.12 MMtpa. ORLEN SA, primarily owned by the Polish state, is fourth in the list at 4.1 MMtpa, followed by Italy’s state-controlled Eni SpA at 3.23 MMtpa.
Rounding up the top 10 are Wintershall Dea Deutschland GmbH, TotalEnergies EP Nederland BV, MOL Magyar Olaj- és Gázipari Nyrt., SHELL ITALIA E&P and BlueNord Energy Denmark A/S. Their obligations range from 1.34 MMtpa to 1.98 MMtpa.
Four more companies have contributions over one MMtpa: Oldenburgische Erdölgesellschaft mbH, NAM Offshore BV, INA-INDUSTRIJA NAFTE d.d. and TotalEnergies EP Danmark A/S.
A company’s obligation is calculated by dividing the volume it produced over the three years by the sum of the production of all obligated entities during the period then multiplying the result by 50 MMtpa.
“Where, during the relevant production period, an authorization has been transferred between obligated entities, the date of the transfer shall be the relevant point in time for the division of the production and the corresponding contribution obligation between the authorization holders”, says a separate deregulated regulation specifying the criteria for determining obligated producers and the method for computing their contributions.
“Where an authorization holder has ceased to legally exist by 31 December 2030 or if the relevant authorization is transferred to a new legal entity, the contribution obligation corresponding to the relevant crude oil and natural gas production activities between 1 January 2020 and 31 December 2023 falls to the subsequent authorization holder”.
Producers with less than 610,000 metric tons of oil equivalent output between 2020 and 2023 and account for less than five percent of the total Union production over the period are exempted.
The obligated producers have until June 30 to submit to the Commission their plans on how to meet their contributions. “These plans must confirm the entity’s contribution and specify the means and the milestones for reaching the targeted volume”, the Commission statement said.
“The adopted Delegated Regulation is subject to a two-month scrutiny period by the Parliament and Council”, the statement said. “Following this period, and assuming no objection is made, the Delegated Regulation is expected to enter into force at the end of July 2025 at the same time as the Commission Decision setting the companies’ shares by publication in the Official Journal of the European Union”.
Kurt Vandenberghe, the Commission’s director-general for climate action, commented, “Having extracted hydrocarbons and contributing to greenhouse gas emissions, it [the oil and gas industry] will now contribute to storing CO2 and help mitigate climate change. By combining their industrial know-how with faster permitting processes and robust financial support – including from the ETS-resourced Innovation Fund – we can make substantial progress in advancing industrial decarbonization and modernization in Europe”.
Source: By Jov Onsat from Rigzone.com