15-2-2024 (JAKARTA) Singapore has taken the lead by becoming the first country to sign a letter of intent (LOI) with Indonesia, initiating cross-border collaboration on the capture and storage of carbon dioxide (CCS). This development comes in response to a new Indonesian law allowing such collaboration. The governments of both countries announced this groundbreaking agreement on Thursday, February 15.
Indonesia recognizes the potential for developing its upstream natural gas sector and CCS as part of the global transition towards greener fuel. In line with this, the country issued a presidential regulation last month, permitting CCS operators to allocate 30 percent of their storage capacity for imported carbon dioxide (CO2).
Singapore, with its aim of achieving net zero emissions by 2050, is actively exploring low-carbon technological pathways, including hydrogen and CCS, as part of its comprehensive set of mitigation measures.
Under the LOI, Singapore and Indonesia will establish a working group dedicated to seeking a legally binding bilateral agreement on cross-border transport and storage of CO2 between the two neighboring nations. A joint statement released on Thursday emphasized that this preliminary agreement represents “a significant milestone in our efforts towards sustainable development and environmental stewardship.” Jodi Mahardi, Indonesia’s deputy coordinating minister overseeing energy, expressed this sentiment to Reuters.
Singapore’s Ministry of Trade and Industry (MTI) deputy secretary, Keith Tan, echoed the sentiment in the joint statement, stating that “Cross-border carbon capture and storage is an emerging solution in Asia, and supports Singapore’s transition towards a low-carbon future.” He further added, “With this LOI, Singapore and Indonesia can become the pathfinders to catalyze the deployment of cross-border CCS projects in Southeast Asia.”
CCS is a process that involves capturing, transporting, and storing the CO2 emitted as a byproduct from various activities, such as power generation. By capturing and storing this CO2, it prevents its release into the atmosphere, offering a viable pathway to decarbonize emissions from sectors that are challenging to abate, such as energy, chemicals, and power.
To achieve net zero emissions by 2050, the International Energy Agency estimates that global carbon capture utilization and storage facilities will need to increase their capacity to approximately 1 gigatonne per annum (gtpa) by 2030 and 6 gtpa by 2050.
In 2022, around 40 million tonnes of carbon dioxide were captured and stored worldwide. While critics argue that CCS is an expensive and unproven technology, Indonesia aims to establish itself as a regional hub for CO2 storage.
The Indonesian government claims that the archipelago possesses over 400 gigatonnes of storage capacity in the form of depleted oil and gas reservoirs and saline aquifers. Additionally, the country has 15 CCS and carbon capture, storage, and utilization projects in various stages of preparation, with a combined investment of nearly US$8 billion.
Singapore, as part of its Sustainable Jurong Island plans announced in November 2021, aims to achieve 2 million tonnes per annum (mtpa) of carbon capture by 2030 and 6 mtpa by 2050.
Currently, there are no cross-border CCS projects in Asia, although countries like South Korea and Japan have expressed their intentions to implement such projects in the future.
