Green light for carbon capture and low carbon power joint venture projects in Teesside
- Go-ahead for two major projects aimed at providing low carbon power, supporting economic growth and enabling future sources of value for companies, region and country.
- Both joint venture projects were selected for development under UK Government’s CCUS cluster process.
- Projects aligned with bp’s high-graded and disciplined hydrogen and CCS plans; project financing expected to support capital-light investment model.
bp, together with its partners, today confirmed that it has reached financial close for two major carbon capture and storage (CCS) projects in Teesside in the north-east of England: the Northern Endurance Partnership (NEP) and Net Zero Teesside Power (NZT Power). This follows the selection of nine contractors in March 2024 and gives the go-ahead for the projects to proceed to the execution phase.
NEP, through its CO2 transport and storage system, will help develop and underpin a lower carbon future for industry in the region. NZT Power, a gas-fired power station with carbon capture and storage, will provide flexible low carbon power into the UK national power grid. The two projects will capture and transport millions of tonnes of CO2 and are expected to support thousands of jobs through their construction and operation.
Felipe Arbelaez, bp’s senior vice president of hydrogen and carbon capture & storage, said: “The progress of these projects to financial close is a demonstration of the power of the private and public sectors coming together to deliver integrated low carbon energy projects. They will create value for the region, partners, customers and bp. The projects further demonstrate bp’s focused and value–driven strategy for hydrogen and CCS – delivered together with our partners while maintaining our disciplined capital-light model.”
Consistent with the high-grading of bp’s hydrogen and carbon capture plans, the projects form part of the 5-10 investments that bp expects to progress this decade. Both Teesside projects will be initially funded through optimal project financing, enabling efficient use of capital for both joint ventures and its partners.
Louise Kingham, bp’s head of UK, added: “These projects represent another step forward for bp’s overall investment plans in the UK. They harness the skills, talent and determination of an established industrial region and apply them to the UK’s own energy transition. We’re proud of the potential of these projects to help stimulate economic growth by supporting thousands of jobs and helping UK companies prosper through the vast supply chains involved, while creating the infrastructure to help major industrial companies with their decarbonisation plans.”
Energy Secretary Ed Miliband said: “This investment launches a new era for clean energy in Britain - boosting energy security, backing industries, and supporting thousands of highly skilled jobs in Teesside and the North East. This is the Government’s mission to make the UK a clean energy superpower in action – replacing Britain’s energy insecurity with homegrown clean power that rebuilds the strength of our industrial heartlands.” NEP, a joint venture between bp (45%), Equinor (45%), and TotalEnergies (10%), will be the CO2 transportation and storage provider for the East Coast Cluster (ECC) [1] development.
NEP’s Teesside onshore infrastructure will serve Teesside-based carbon capture projects – NZT Power, H2Teesside and Teesside Hydrogen CO2 Capture. These projects were selected as first emitter projects within the East Coast Cluster by the UK Government’s Department for Energy Security and Net Zero (DESNZ) in March 2023, as part of the UK’s cluster sequencing process for carbon capture and storage. NEP’s infrastructure will have capacity to transport and store an initial four million tonnes of CO2 per year with the ability to expand in the future. bp will provide operating services to NEP.
NZT Power, a joint venture between bp (75%) and Equinor (25%), could generate up to 742 megawatts of flexible, dispatchable low-carbon power, equivalent to the average electricity requirements of more than one million UK homes per year [2]. Up to two million tonnes of CO2 per year will be captured at the plant, and then transported to secure subsea storage sites beneath the North Sea via infrastructure provided by NEP. NZT Power could create and support more than 3,000 construction jobs and then support around 1,000 jobs during operations until 2050. bp will also provide operating services to NZT Power.
Construction for the projects is expected to start from mid-2025, largely funded with project finance, with start-up expected in 2028.
Further information:
For more information contact: bppress@bp.com