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Energy / EnQuest continues with plans to ‘transform’ oil terminal site in push to net zero

Sullom Voe Terminal. Photo: BP

THE OPERATOR of Sullom Voe Terminal has reported continued progress with the prospect of transforming the site into a ‘new energy’ hub.

The company said in its half-year results, published on Tuesday, that it “continues to develop cost-effective and efficient plans” to repurpose the site – focusing on carbon capture and storage, electrification and green hydrogen.

The half-year report added that it has “secured exclusivity from the Shetland Islands Council to progress new energy opportunities on the site to achieve value for the Council, the Shetland community and EnQuest”.

The council is a key partner in the ORION project, which aims to transform Shetland into a clean energy island.

Sullom Voe Terminal has been taking in oil from waters around Shetland for export for more than 40 years, providing a big economic boost to the isles.

But it is seen as an important tool in hopes to turn Shetland into a hub of cleaner energy production, alongside the adjoining council-run port.

EnQuest explained that the site “offers several unique competitive advantages”, including access to existing oil and gas pipeline infrastructure, a deep-water port and jetties.

It also highlights Shetland has the “highest wind capacity factor across Europe” – as well as a highly skilled workforce and local supply chain.

EnQuest said it is continuing to explore the potential for repurposing parts of the terminal site to produce and export green hydrogen, made from wind power, and its derivatives.

It has also conducted initial phases of feasibility around carbon capture and storage.

Earlier this year a licensing round for carbon storage sites began and it included two areas to the north east of Shetland.

Carbon capture and storage involves taking CO2 emissions from industrial processes, transporting it via a ship or pipeline and storing it underground offshore, and it is seen as a component of the drive to net zero.

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EnQuest confirmed that both of the sites involved in the licensing round are linked to the East of Shetland pipeline system, which runs into Sullom Voe Terminal.

The company’s studies have indicated there is capability within existing infrastructure to support a project of up to 10 million tonnes of CO2 per annum.

As a result, EnQuest intends to make applications in relation to the two areas in the forthcoming NSTA [North Sea Transition Authority] licensing round, with results expected to be announced in the first quarter of 2023.

Another piece in the jigsaw is electrification of existing infrastructure, including nearby offshore oil and gas platforms.

EnQuest said it is also “assessing onshore wind potential and a new power solution for the Sullom Voe Terminal, which has the potential to significantly reduce the group’s carbon footprint”.

Shetland Islands Council’s infrastructure director John Smith said the local authority is “clearly very interested” in the transition of Sullom Voe Terminal.

“We are working through ORION and other partnerships to progress that on a number of fronts,” he said.

“The Energy Hub is serviced by the Port of Sullom Voe – owned and operated by Shetland Islands Council – while EnQuest operate Sullom Voe Terminal (SVT). 

“The council acknowledges that Enquest have a particular locus on new energy development at SVT and it would be for EnQuest to comment further on any specific plans.”

EnQuest has been approached for comment.

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