Clarksons, a global provider of maritime services, has called for urgent investment in LCO2 shipping capacity following the European Commission’s decision to enact binding carbon storage obligations on oil and gas producers in the EU.
This measure, introduced under Article 23 of the Net-Zero Industry Act (NZIA), a legislative framework designed to boost Europe’s clean technology manufacturing and support the goal of climate neutrality, requires 44 companies to collectively secure a minimum of 50 million tonnes of annual CO2 injection capacity by 2030.
While this regulation is currently being scrutinised by the European Parliament and Council, it has already prompted concerns regarding the lack of transportation infrastructure available to meet the target. In its call-to-action published last week, Clarksons stated that shipping is likely to be the only viable option for many emitters not located near storage sites.
Kenneth Tveter, Global Head of Green Transition and LCO2 at Clarksons, said: ‘This is a clear signal that the EU is putting CCS at the top of the decarbonisation agenda, and the oil and gas producers in Europe will be forced to provide storage solutions for CO2 and help drive the value chain forward. No time to waste.’
Tveter points out that shipping offers advantages over pipelines, including shorter lead times, improved permitting flexibility, and enhanced scalability. However, the current fleet of LCO2 carriers is limited, and most existing or ordered vessels are already tied to long-term contracts.
Clarksons estimates that approximately 50 new LCO2 vessels will be needed globally over the next five years to support anticipated CCS projects. Tveter said that his company is working with clients from the early stages of project development through to execution, and demand may increase as more countries implement carbon storage regulations.
Clarksons has also warned that LCO2 vessel construction is complex and requires specialised knowledge. ‘Executing newbuilds requires unique yard competence and commercial and technical knowledge,’ said Vebjørn Kjerstad, LCO2 shipping specialist at Clarksons. ‘If you are not working on your LCO2 shipping strategy today, including project execution plans, you are already behind.’
The construction of a vessel typically takes two to three years, in addition to the time required for design, front-end engineering, and contracting. Clarksons note that any delay in initiating this process could result in missing the 2030 storage deadline.
Recent developments in Asia highlight growing international momentum behind CCS. Petronas CCS Ventures, Mitsui O.S.K. Lines, and MISC Berhad have launched a joint venture, named Jules Nautica, which will own and operate LCO2 carriers for regional CCS projects. The consortium has successfully completed the front-end engineering design for a 62,000m3 carrier in collaboration with the Shanghai Merchant Ship Design and Research Institute.
Separately, NYK and its affiliate, Knutsen NYK Carbon Carriers, are collaborating on a 40,000m3 LCO2 vessel based on elevated pressure tank technology. Seven Japanese shipping and shipbuilding companies have also secured approval in principle from classification society ABS for two LCO2 carrier designs featuring cylindrical carbon manganese steel tanks.
In Europe, Germany’s HGK Shipping is designing a river-seagoing gas tanker capable of transporting liquefied ammonia and LCO2. The vessel is intended to operate on inland waterways as well as in coastal regions.
Clarksons has announced that its Green Transition service has expanded to include LCO2 as part of a project-based advisory offering. Its stated aim is to provide visibility and mitigate risk by analysing market opportunities, developing shipping strategies and supporting project execution.
