Deploying a shipping infrastructure to enable carbon capture and storage from Norwegian industries

This paper investigates the deployment over time of a shipping infrastructure to enable carbon capture and storage from Norwegian industries. In particular, optimal transport investments, routing, shipping portfolio, and transport conditions required cost-efficiently connect nine Norwegian and Swedish industrial facilities to the Northern Light Initiative are identified based on a multi-period mixed-integer model. Optimization of the shipping portfolio allows us to analyze the potential benefits of economics of scale and how sailing multi-stop routes can utilize the potential benefits. Analyses show that the transport cost can be reduced by 12% when the optimal shipping portfolio is implemented instead of operating an independent transport chain for each emission source. Shipping at 7-bar is expected to result in lower costs compared 15-bar shipping, but a significant drawback is the technological maturity of the 7-bar transport technology. The model proposes two transport chains run in parallel as cost optimal, the average transport cost of the 15-bar chain is 32.4 euro/ton, and the 7-bar has an average cost of 25.4 euro/ton. A net present value criterion is used to identify the conditions for when retrofitting of the 15-bar transport chain is economically sound. Break-even is achieved when the ship's re-sale price is 60% of the purchase price, and the cost of retrofitting a 15-bar conditioning plant to a 7-bar is 40% of the investment cost. While retrofitting may be an attractive solution, the decisions lead to a less robust shipping portfolio, and the retrofitting of a fully operating carbon capture and storage value chain is regarded as unlikely.