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25th March 2022, London: Storegga Limited ("Storegga"), the independent UK decarbonisation developer, and Mitsui & Co., Ltd. ("Mitsui"), the Japanese trading and investment company, have signed a Memorandum of Understanding ("MOU") on commercialisation of Direct Air Capture ("DAC") technology, supporting the development of the UK's first DAC facility in North East Scotland.
Mitsui is already an investor in Storegga and this memorandum marks a closer working relationship to realise the first large-scale DAC facility in Europe, with the potential to extract one million tonnes of CO2 from the atmosphere annually. The UK Government has announced its ambition to deploy at least 5 M/T per year of engineered carbon removals by 2030. This direct air capture facility will be a major contributor towards this target. Once developed, this pioneering project will provide a model for deploying this crucial carbon reversal technology elsewhere in the UK and internationally to materially support global net zero targets. The facility will be a vital component of both meeting the UK and Scotland's legally binding net zero targets by 2045 and 2050 respectively, and will also have the ability to serve international customers. Early customers of the facility will include Virgin Atlantic.
The captured CO2 will be transported to the Acorn Carbon Capture & Storage project for permanent geological storage in depleted North Sea oil and gas reservoirs and saline aquifers. The Acorn project is currently in the detailed engineering and design phase of development and is planned to be operational in the mid 2020's.
"The UK's decarbonisation knowledge and technology are highly attractive to the world's leading international infrastructure developers. Investor appetite is strong but the path to decarbonisation is complex and will require the best minds from around the world, working together. The support of the UK government is vital. Offshore wind has been a great success for the UK as a result of its supportive regulatory framework; the UK has the opportunity to repeat this early mover success with Direct Air Capture.
"The international energy crisis has highlighted our need for enhanced self-reliance. Taking a leading position on direct air capture gives us the opportunity to develop our own decarbonisation industry, creating jobs along the supply chain and sharing these skills and knowledge with the world. Mitsui's commitment says a lot about the quality of endeavour of the UK decarbonisation industry, and we look forward to working with the UK Government on a favourable regulatory regime that sets us up for future success."
As part of the agreement, Mitsui will share their own technical knowledge and explore opportunities to partner businesses around the world. In addition to joint studies to commercialise DAC technology, Storegga and Mitsui will consider and assess the possibility for Mitsui to coinvest in and offtake credits from the DAC project further strengthening the strategic partnership between the two companies.
"Since our initial investment in March 2021, we have been closely supporting Storegga to grow its businesses with our expertise in upstream energy sector and extensive global network. We are truly excited to conclude this MOU. Being a Negative Emissions Technology, DAC projects can generate carbon credits which will be critical in offsetting emissions from hard-to-abate sectors globally and achieving net-carbon zero targets."
"Direct air capture is a meaningful way to truly and permanently offset carbon generation. The recent Energy Transitions Commission report concluded that direct air capture will be an essential component of cleaning up our atmosphere. We had a huge amount of interest in our business at COP26. The early adopter companies who want to talk to us about buying direct air capture carbon credits are leading businesses around the world with ambitious environmental, social and governance (ESG) strategies. Businesses with a genuine desire to reduce emissions, avoid flaky offsetting, and have tangible plans to permanently remove CO2. With the right support, direct air capture will not only reduce carbon in the coming years but could reverse the carbon damage done since the industrial revolution."
Storegga's first DAC facility will be built in the North East of Scotland, close to the Acorn CO2 Transport and Storage system. In its initial phase, the business will sell carbon credits to large organisations to offset their carbon emissions. This will need to be supported by a regulated carbon credit mechanism. The UK government is currently in consultation on the appropriate business models to support direct air capture in the UK.
“Build brighter futures, everywhere” as our corporate mission, and to gain the trust and expectations of our stakeholders to realize a better tomorrow for earth and for people around the world, we have identified five material issues (“Materiality”) for Mitsui’s sustainable growth. We anticipate this particular project/ business to contribute especially to the realization of “Create an eco-friendly society”
Secure sustainable supply of essential products
Enhance quality of life
Create an eco-friendly society
Develop talent leading to value creation
Build an organization with integrity