Asia-Pacific CO2 shipping market forecast at 100m tonnes by 2050Asia-Pacific CO2 shipping market forecast at 100m tonnes by 2050

The new report looking into opportunities for shipping to enable cross-border Carbon Capture, Utilisation and Sequestration (CCUS) initiatives see a particular opportunity for maritime in the APAC.

Opportunities for shipping were seen as higher in the APAC region than Europe given the geographical mismatch between potential sources of captured CO₂  and sequestration hubs.

In Northwestern Europe eco-system distances span around 500 – 1,000 km whereas in APAC distances range from 1,000 – 11,000 km spanning Northeast Asia through to Australia.

“To address this, several APAC governments, including Australia, Indonesia, Japan, Malaysia, Singapore and South Korea, are pursuing cross-border partnerships and initiatives to support cross-border CO₂ transportation and sequestration,” GCMD said.

The longer distances required for transportation make shipping more economically viable and attractive versus pipelines. The report identifieda threshold distance of 500 km for transport via shipping to be economically viable for a volume of 5 million tonnes PA (mtpa) of CO₂. The longest routes would be Northeast Asia to Australia spanning 6,000 – 11,000 km.

In terms of a potential market estimated that approximately 100 million mpta of CO₂ captured using carbon capture technologies is expected to be transported across national borders in APAC by 2050. Translated into shipping demand this would require 85 to 150 liquified CO₂ carriers with a 50,000 tonne capacity requiring a total investment of up to $25 billion by 2050.

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Professor Lynn Loo, CEO, GCMD said: “Our study shows that APAC has the potential to lead in CO₂ shipping. In APAC, emitters and sinks are often separated by large bodies of water over vast distances, unlike Northern Europe where CCUS facilities are more geographically concentrated. This makes shipping a more attractive mode of CO₂ transport in APAC, underscoring the importance of building up a shipping ecosystem.

“This effort entails constructing CO₂ carriers, developing port-side infrastructure, establishing standards and guidelines for transporting and offloading CO₂, and upskilling crew with requisite training.”

To create a market of the scale forecast will also require concerted efforts from both the public and private sectors GCMD said. These would include economic incentives, long-term contracts for midstream players, and greater clarity on key standards.

Carl Clayton, Partner & Associate Director, Global Co-Lead for BCG’s CCUS Topic said: “The unique distribution of large emitters and sequestration sites across APAC offers significant opportunities for CO₂ shipping and cross-border CCUS.

“Northeast Asian emitting countries have a chance to drive technological innovation and strengthen their leadership in commodity shipping, while Southeast Asia and Australia can utilise their vast depleted oil and gas and other storage assets, to foster green economy growth and international collaboration. Government support will be essential in the short term to ensure economic viability and to address cross value chain risks.”

Download the full report