Japanese majors press ahead with plans to start large-scale LCO2 transport in 2028

Japanese shipbuilders Mitsubishi Shipbuilding, a part of Mitsubishi Heavy Industries (MHI) Group and Nihon Shipyard, a joint venture between Imabari Shipbuilding Co, and Japan Marine United Corporation, have signed a Memorandum of Understanding (MOU) with compatriot Mitsui & Co. and Mitsubishi Corporation on the collaborative study for ocean-going liquified CO₂ (LCO₂) carriers.

The aim is to realize large-scale international transportation in Japan-initiated carbon dioxide capture and storage (CCS) from 2028 onwards. The initiative is part of the overall decarbonization strategy by 2050, led by the Japanese government, which heavily relies on the CCS business.

Carbon capture and storage holds particular significance for hard-to-abate sectors, especially in Japan, due to its potential to address the persistent challenge of reducing emissions in industries that are inherently difficult to decarbonize.

Hard-to-abate sectors, which often include heavy industries like cement, steel, and chemicals, rely on processes that emit substantial amounts of carbon dioxide (CO2) as an inherent byproduct. In Japan, where industries play a crucial role in the economy, CCS becomes a critical tool in achieving ambitious carbon reduction goals.

Japan Organization for Metals and Energy Security (JOGMEC) launched a feasibility study on the Japanese Advanced CCS Project, as a publicly offered project in the fiscal year 2023.

As such, demand for LCO₂ carriers is expected to increase to transport captured CO₂ from Japan to storage areas in various CCS projects.

LCO2 carriers are vital components in the realm of carbon capture and storage, facilitating the pivotal journey of captured carbon dioxide from industrial sources to secure storage sites.

MHI stressed that it was very important to standardize the specification and design of LCO₂ carriers across each project as well as to establish a realistic production supply chain so that LCO₂ carriers will be constructed and supplied stably in Japan and CCS value chain will be achieved with improved economic efficiency.

Therefore, under the MOU the four companies have agreed to solve these issues related to the construction of LCO2 carriers and marine transportation, starting with Japan-initiated CCS projects and then moving to the Asia-Pacific region.

Mitsubishi Shipbuilding and Nihon Shipyard have already begun a joint study to build LCO₂ carriers, tapping into the knowledge and insight of their shipbuilding expertise.

Mitsubishi Shipbuilding has gathered considerable know-how in the construction of LCO2 carriers with the recent delivery of a demonstration ship for the transport of LCO₂ for New Energy and Industrial Technology Development Organization (NEDO).

The vessel, named Excool, will be chartered by Nippon Gas Line Co., which is jointly conducting the NEDO project, to collect and analyze operational data through CO₂ transportation demonstration tests.

Nihon Shipyard is working on the commercialization of LNG and ammonia-fueled ships in preparation for the upcoming strengthening of GHG emission regulations. As its next step, the company aims to contribute to realizing a sustainable carbon-neutral society by delivering LCO2 carriers essential for the establishment of the CCS value chain.

Mitsui & Co., Ltd. and Mitsubishi Corporation, who are now advancing business development for early launch of the CCS business, are selected as leading companies in the Japanese Advanced CCS Project by JOGMEC aiming for overseas CO₂ storage.