Examination of Witnesses (Questions 120
- 139)
WEDNESDAY 7 DECEMBER 2005
MR COLIN
SCOINS, MR
RODNEY ALLAM,
MR NICK
OTTER AND
MR GARDINER
HILL
Q120 Bob Spink: We have received
evidence that the down-time might be up to a year for a station
and also that the size of the plant is pretty big and that that
might be restrictive, and that the costs are very high. Are there
any technical ways to resolve these problems to cut down the lead
time, the fit time, and to improve the technology and make it
cheaper? Are there any technical possibilities of solutions?
Mr Otter: Let me say first that
on the programmes we have we are trying to come up with more cost-effective
solutions that exist now. It is quite right that solutions exist
now. It would be very nice to be able to halve the capital cost,
for example, because capture is the predominant cost in these
things. Certainly in our programmes we are exploring different
substances to amines, for example, which we hope will significantly
cut the cost. That does not answer your question about the time
lead because I think the time is probably the same, whatever system
you put in. So there is a time that you would have to suffer by
taking the station out to fit these types of technologies.
Q121 Chairman: I do not understand
that because when we looked around a power station two weeks ago,
it was clear that there were six or eight different burners within
that power station. Why is it not possible to take simply one
line off and retrofit that and then go on to the next and retrofit,
so that you are only losing perhaps 25% of the power station's
output at any one time by doing that? That would not happen in
any other business.
Mr Allam: That is the way it is
proposed that it should be done on a sequential basis.
Q122 Chairman: The implication of
Bob Spink's question was that you would have to close the whole
power station.
Mr Otter: Colin Scions should
answer that because he is a generator.
Mr Scoins: You are right that
if you were going to do that you would close one unit at a time.
However, do not forget that much of this plant is very old, potentially
40 years old. It is probably not an economic decision to retrofit
a plant of that age.
Q123 Bob Spink: What about the plant
that exists in China and other places? Is that more modern plant
that is going to take retrofit more easily or do they have the
same problems as we will have?
Mr Otter: If I can start again,
I think that is a crystal clear issue because they are putting
in any number that is bounced about as gigawatt per week of coal-fired
plant, so if we do not look out, that could well be a lock-in
of carbon, clearly. It is actually quite efficient plant. Let
us say that on average it is higher than our efficiency. One of
the issues is trying to get them to engage in the process. That
is a retrofitable solution to high efficiency plant. You are not
replacing old plant. You are buying these technologies for new
plant now, or newly installed plant.
Chairman: We will return to that issue
later.
Q124 Bob Spink: Rodney Allam mentioned
oxyfuel at the beginning. What do you think about oxyfuel? What
are the issues regarding oxyfuel?
Mr Hill: We spend a lot of time
studying oxyfuel in our CO2 capture project and it looks very
promising technology, but it is more of a long-term technology
mainly because the cost of providing oxygen makes it an expensive
technology and the temperatures in the combustion process because
you are burning pure oxygen make it really quite tough for these
materials. It is an issue around material choice to manage the
high combustion temperatures and the cost of supplying the vast
quantities of oxygen required for oxy-firing.
Q125 Bob Spink: Could I press you,
Gardiner? By "long term", do you mean it is long term
as in nuclear fusion—we think we will get there—or
is it long term as in: we can do it but it is going to be 15 years
or 10 years?
Mr Hill: My sense is more the
latter. I think we can do it and in fact there will be some demonstration
small-scale of oxy-firing that will be undertaken by a number
of companies in the next five years, but there is probably a 15-year
timeframe. That is when we might expect to see oxy-firing perhaps
being used on a much larger scale. It is not like nuclear fusion;
which is much longer time-scale.
Q126 Bob Spink: Are there any economic
advantages to doing oxyfuelling?
Mr Hill: If we can demonstrate
the technology, there are. In fact, it can actually improve some
of the other pre-combustion processes as the technologies in the
oxy-firing process actually oxygen, to reducing the cost of gasification
technology, for instance. The technology in oxy-firing would help
other processes to decarbonise fuels. Some analyses has been done
on the aspects but really they are the materials and oxygen aspects.
Mr Allam: Could I add just one
small thing to that? It is feasible to retrofit coal-fired PF
power stations. The power stations which are being built in China
are often the super critical stations which would be the retrofit
without the modifications that is going to cause the high amount
of down time when they are retrofitted onto the older British
stations. So retrofitting into China would be a much easier prospect
because it would not mean the very long shut down, which is basically
an avoidable modification.
Q127 Chairman: Is desulphurisation
standard on the new plant in China?
Mr Allam: No, it is not; it is
not standard at all. One of the advantages of oxyfuel is that
it can take out the sulphur and the NOx as well as the CO2 essentially
in a complete operation. What is also required there is to address
the corrosion problem within the boiler because the sulphur levels
are higher. There are also burner design issues but they are not
show-stoppers. There are optimisation issues. The idea of retrofitting
a large PF power station is technically possible but in the UK
it would only be efficient if there were a simultaneous upgrade
of the station to super-critical conditions. That is where the
long shut-down occurs. In the actual technology for doing the
conversion, one of the major problems is really the space requirements
for the equipment. The oxygen production capacity is well within
the capability of industry, even for these very large plants.
These are being supplied at the moment for gas to liquids, for
example. So the technology exists and could be implemented.
Q128 Dr Iddon: BPs storage experience
was highlighted on Newsnight again last night, I notice.
I want to turn to the risks. Obviously you have probably more
experience than many people of CO2 storage in the Algerian desert
or the Sahara. Are you satisfied that we know enough about the
potential health and environmental risks of CO2 stored in those
quantities and carried by pipeline in those quantities?
Mr Hill: I think a lot is known
about that. We have done a large number of studies now over the
last many years actually in looking at the performance of CO2
in gas and oil recovery and the potential use for storage. I think
now we have a good grasp of what the key elements are. We went
through a rigorous process identifying risks and looked at: are
these risks as low as practically possible and, if not, what are
the things we need to do to make them so? When we look at that,
clearly we have to understand the integrity of the reservoir and
clearly oil and gas reservoirs, because they have held hydrocarbons
for geological time, we know have a good seal and are good places
to store CO2. The area which does open up the possibility of containment
or lack of containment would be the wells. That is where you break
that original seal by penetrating the reservoir. So understanding
the design, mechanical aspects and materials of the wells, the
integrity of the wells, is key. We put a lot of effort into well
design and monitoring wells to check they have integrity.
Q129 Dr Iddon: Can we separate this
out, Gardiner, into pipeline and cavity storage under the sea
or under the desert?
Mr Hill: Yes. In a pipeline system,
what we have done is to look at the pipelines that are currently
in use today, and over 1,000 kilometres are currently being used
to transport CO2 in the US as part of the enhanced oil recovery
projects there. We have looked at that experience and that is
good experience. If you can keep the CO2 dry, then you have a
pretty safe experience of moving CO2. It is non-corrosive if it
is dry. It only forms an acid when it is wet. The other issue
is that we have also looked at the experience from the gas handing
system. The world today has a very extensive system managing gas
and storing gas in underground caverns for peak demand. We can
look at that experience and how that can help us in managing the
risk in transporting and storing CO2.
Q130 Dr Iddon: Has there ever been
a blow-out on a pipeline?
Mr Hill: I am actually not sure
about that. I am sure there may well have been leaks. What we
do is look at the safety aspects of the design of the pipeline
and managing and operating the pipeline and making sure the risk
is as low as practically possible because safety has got to be
our most important consideration.
Q131 Dr Iddon: Of course transport
in the desert is one thing but transport through a highly populated
urban area in Britain is another.
Mr Hill: Absolutely.
Q132 Dr Iddon: Presumably the pipelines
are transporting underground?
Mr Hill: Yes. There is a mixture.
Some are above ground; the majority are below ground. In the US
they are not always in remote areas; they do pass inhabited areas,
so they have that experience, they have the practice in place
as to how to install the pipeline and operate the pipeline safety.
The track record is very good.
Q133 Dr Iddon: Presumably there could
be a major blow-out, for example an extreme scenario would be
a terrorist attack on a pipeline. Have you considered that possibility?
Have you researched that possibility and what would be the outcome?
Mr Hill: When you design a pipeline,
you would look at what is the containment in the event there was
a leak or some disruption to the pipeline, as we to today in all
the pipelines that we build. We are also looking at the volume
we have to contain in the event there is a release or damage to
the pipeline for whatever reason. Along the pipeline you may have
the ability to isolate sections off so that the whole pipeline
volume was not released. In the matter of CO2, CO2 is not hazardous;
it is not explosive in the way that gas is highly explosive.
Q134 Dr Iddon: It is heavier than
air rather than lighter than air.
Mr Hill: It is heavier than air.
The issue is concentrations. There is CO2 in the air that we breathe
in the building today. When the concentration gets particularly
high, we will actually suffocate. It is quite rare to get that.
In the open space with the wind, it generally means you cannot
get these high concentrations and so it is actually safer compared
to gas because it does not have that explosive nature.
Q135 Dr Iddon: Obviously you were
kind enough to tell us about the DF1 project in Peterhead and
the Miller Field. Has BP done a full risk analysis yet on Peterhead
and Miller?
Mr Hill: That is an ongoing process.
Today we are actually aiming to appraise the last stage of that
process. As part of the BP project management system, we have
a rigorous process to go through before we sanction and implement
a project. We are still appraising and selecting how we undertake
that project. That project will not be sanctioned until 2006.
Part of that process will be identifying the risks and mitigations
necessary to make these risks as low as practically possible.
That is a piece of process that we do just as good business practice.
Q136 Dr Iddon: This is another question
to you, Gardiner. You indicated that you are using the Miller
Field in tertiary oil recovery using the compressed carbon dioxide.
Presumably, you will have to remove existing seals on well bore
heads and then obviously replace them at some stage. Are there
any problems with that?
Mr Hill: We do not envisage any
problems. We are quite lucky that what makes Miller an excellent
field to undertake this as the first large scale industrial demonstration
is that Miller has CO2 indigenous in the oil, and so the platform
and the production facility was built with CO2 in mind. Many of
the wells and tubulars and indeed the seals are already CO2 compliant.
But when we redesign or retrofit the platform or change it to
put CO2 down, we look at every aspect of the engineering design
to ensure engineering integrity. We look at the compatibility
for the seals and all materials for the CO2 duty and we regularly
test to check that integrity. That is not an issue. We know that
we can transport, move, CO2 safety. It has been done for many
years. There are seventy enhanced oil recovery projects where
CO2 is injected down wells, where they have integrity of completions
and the well bores, so we are very confident with that.
Q137 Dr Iddon: Obviously tracers
could be put into the carbon dioxide that you are putting down
the wells to identify leakage in future. Has that been done with
the carbon dioxide that you have used already for secondary oil
recovery?
Mr Hill: I am not sure if any
operators have been using CO2 traces in EOR. We plan to do that
in the In Salah project which was shown on the TV last night.
Around the In Salah experience of storing CO2 in that gas reservoir,
we have a science project so that we can learn as much as possible
about the good practices for storing CO2 and observing and monitoring
CO2 so that we can adopt these in Miller and other future projects.
One of the things that we are planning doing there is injecting
different types of tracers at each of the three wells so we can
identify the CO2 that went down that well wherever it appears
in the reservoir or, in the unlikely event that it might leak.
Q138 Dr Iddon: Obviously there is
an acceptable leakage rate from one of the Miller wells, for example.
Have you estimated how long it would take, even how many centuries
it would take, for the complete compressed carbon dioxide to leak
out at those acceptable rates?
Mr Hill: I am not sure there is
an acceptable rate. We would be designing this with a view to
retaining all the CO2 in the reservoir. While I accept there is
never 100% guarantee, we would be designing it with that intent.
When we inject the CO2 into the reservoir, from the work we are
doing as part of our research and development, we know there are
four mechanisms that help to lock that CO2 in the sub-structures,
so we would be able to model how these four mechanisms actually
engage the CO2 and lock it permanently in the reservoir. With
time, we can built up confidence by measuring with tools the CO2
in the reservoir to check that it is doing what we said it would
do in our forecasting.
Q139 Chairman: Could you tell us
something about the liability? Presumably you would be liable
for the leakage over a given period of time, certainly while you
are still sticking the CO2 into the well head. Thereafter, whose
liability will it be to detect leakage and indeed deal with any
leakage that occurs?
Mr Hill: These are excellent questions.
I think during the licence period while we are operating and storing
CO2, we would expect to be liable as the operator for the whole
operation and storage of CO2 in that reservoir, but, as we complete
the storage of CO2 in that reservoir and abandon the field which
will have CO2 in it and then release the licence back to the Government,
we would expect the liability at that point also to be transferred
from the company because CO2 storage will be around for many hundreds
of years; it would be difficult to see how any business could
be held liable because businesses quite often are no longer around
in many hundreds of years. I would envisage some conditions in
place so that as you hand the licence back, you would be satisfied
that all reasonable precautions and measures had been taken to
ensure complete integrity of the storage site and hence the liability
would be transferred back.
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