Only Barents Sea CO2 exploration license gets new operator

The Norwegian Ministry of Energy has approved PGNiG Upstream Norway (PUN), part of Poland’s ORLEN Group, as operator and partner with Horisont Energi in the only CO2 storage located in the Barents Sea.

Horisont Energi and PUN announced a sales purchase agreement on December 11, 2023, making PUN a license partner in the Polaris CO2 project. The governmental appointment of PUN as operator and approval as licensee is said to represent a key milestone in the development of the project.

“With PGNiG Upstream Norway now in place as operator and partner, we have a very strong fundament to unlock the potential of Polaris as a vehicle to reduce emissions on an industrial scale. We have had excellent cooperation with the PUN team so far and look forward to developing this great partnership going forward,” said Bjørgulf Haukelidsæter Eidesen, CEO of Horisont Energi.

The two companies each have a participating interest of 50% in the EXL003 CO2 license Polaris, which will provide CO2 storage for Horisont Energi’s and Fertiberia’s Barents Blue project as well as other CO2 customers.

Horisont Energi said it was currently in advanced dialogues with E.ON on CO2 storage capacity for the Polaris CO2 storage license and has as previously disclosed agreed to develop and share the costs of shipping CO2 from Central Europe to Norway. E.ON signed a letter of intent (LoI) last year committing to buy and store 1 million tonnes of CO2 from European customers.

“We are glad to see the Norwegian authorities supporting the rapidly developing CCS industry in Norway and Europe. The Polaris carbon storage project is a significant emission management initiative in Europe with expected ripple effects far beyond the Norwegian Continental Shelf,” said Daniel Obajtek, ORLEN’s CEO and President of the Management Board.

“We strongly believe that our involvement in this project will contribute to our strategic goal to become a regional leader of the low carbon transition. Polaris will enable us to launch carbon management services to support our customers on their own way to net zero future.”

The Polaris license is located several hundred meters below the seabed in the Barents Sea, 140 kilometers off Hammerfest. The reservoir is a key component for the planned Barents Blue ammonia plant, with captured CO2 from the sequestration of natural gas and production of blue ammonia set to be stored in the Polaris reservoir. In addition, the reservoir will be available for third-party storage.

The application for the exploration license was submitted in 2021, the Norwegian Ministry of Petroleum and Energy announced the award of the license to a group consisting of Horisont Energi, Equinor and Vår Energi on April 5, 2022, and in June the same year, the storage license was formally approved.