Three Japanese energy enterprises, namely JERA, Tokyo Gas [9531:JP], and Inpex [1605:JP], plan to join a carbon capture and storage (CCS) project in northern Australia with an expected investment of up to JPY100bn (USD748m) in total, as reported by Nikkei Asia on June 9. Led by Australian oil and gas company Santos [STO:AU], the project could be the world’s largest CCS base. The project is anticipated to come into operation in 2025 and store up to 10m tons of carbon dioxide (CO2) per year, equivalent to one-fourth of the amount of CO2 the world stores each year at present. The project will not only process CO2 transported from a nearby gas field but also consider capturing CO2 emitted from Japanese factories and power plants.
Japan pledged to reduce its carbon emissions by 46% by 2030 compared to 2013 levels before it realizes net-zero emissions by 2050. According to the International Energy Agency’s (IEA) scenario for achieving net-zero emissions by 2050, the world will need to recover 7.6bn tons of CO2 annually in 2050. In that scenario, Japan’s industry ministry estimates the nation will need to capture and store 240m tons per year at a cost of over USD17bn for carbon capturing alone. To abate the costs of CCS, Japanese companies are keen to collaborate with the leading groups in the field. In February 2022, Japanese trading houses Mitsubishi [8058:JP] and Mitsui [8031:JP] also participated in an Australian CCS project led by Australian energy group Woodside [WPL:AU] and British oil giant BP [BP:US].