Samsung, SK, Lotte, POSCO take carbon capture tech to Southeast Asia

The Korea Times

The Korea Times

Business

Sat, September 30, 2023 | 21:15

Companies

Samsung, SK, Lotte, POSCO take carbon capture tech to Southeast Asia

Posted : 2022-08-03 16:24

Updated : 2022-08-04 12:46

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By Lee Kyung-min

An increasing number of local conglomerates are seeking to fortify carbon capture utilization and storage (CCUS) business cooperation with Southeast Asia, a move to maximize mutual interests through combining their need to identify storage facilities with the group of countries' substantial dependence on fossil fuels, according to market watchers, Wednesday. They are energy affiliates of POSCO, Samsung, SK, Lotte and GS.

Malaysia and Indonesia, for example, rely on coal, oil and natural gas for over 80 percent of their power consumption. All coal-powered plants need to be shut down by 2030, as outlined by the Paris Agreement. However, applying CCUS technology can help the facilities buy time before their full shutdowns.

CCUS technologies involve the capture of carbon dioxide (CO2) from fuel combustion or industrial processes as well as the transport of CO2 via ship or pipeline. It is used to create valuable products or services or be stored permanently deep underground in geological formations.

The technology for storing carbon is referred to as CCS, and the technology for using carbon in production facilities is CCU.

According to the industry, six local firms ― Samsung Heavy Industries, Samsung Engineering, Lotte Chemical, GS Energy, SK Energy and SK Earthon ― have formed a consortium with Petronas, a state-run oil firm in Malaysia, for effective transport of carbon emitted in Korea to Malaysia for storage.

The Malaysian state of Sarawak is under review as the storage site. Development will pick up speed after a review of business feasibility studies.

The project is the latest example of the Malaysian state-run oil firm seeking cooperation with Korea in the areas of CCUS technologies.

Last December, Petronas signed a memorandum of understanding (MOU) with POSCO International and POSCO Engineering & Construction (E&C) for similar projects.

The three agreed to utilize POSCO Group-developed CCUS technologies in transforming Malaysia into a hub for carbon storage.

A joint research project is ongoing between SK E&S, a liquefied natural gas business affiliate of SK Group, and Indonesia's state-run gas firm PT Perusahaan Gas Negara Tbk (PGN) in the field of CCS.

The cross-country cooperation bodes well for Korea, since it can easily transport carbon captured and stored to European countries and the U.S., where CCUS has robust market visibility.

Oil and natural gas reserves drilled recently in the countries can be used as storage facilities, a relatively easy process compared to identifying sites in densely populated Korea.

The firms can seek expansion of businesses to include hydrogen, a next-generation energy source.

Blue hydrogen, a greener source of energy made from liquefied natural gas (LNG), needs CCS technologies for its generation, presenting growth opportunities both for Korean firms and LNG businesses in Indonesia and Malaysia.

lkm@koreatimes.co.kr