More carbon capture projects to be green-lit soon: federal minister

Wilkinson made the comments in an interview in Calgary, one week after Shell Canada announced it will go ahead with its Polaris carbon capture project in Alberta.

Shell Canada’s decision last week to greenlight its Polaris carbon capture project is likely just the start of a wave of positive investment decisions by proponents of the emissions-reducing technology, said federal Natural Resources Minister Jonathan Wilkinson.

Wilkinson said in an interview he expects 20 to 25 commercial-scale carbon capture and storage projects to break ground in Canada within the next decade.

He added he expects some of those projects will be green-lit by companies soon, now that a new federal investment tax credit for carbon capture and storage is in effect.

“I do expect to see more carbon capture announcements in the coming months,” Wilkinson said in Calgary this week, where he is attending an annual gathering of federal, provincial and territorial ministers responsible for energy and mining portfolios.

While getting the investment tax credit enshrined into law “took longer” than the federal government would have liked, Wilkinson said, companies now have the ability to apply for and receive the credit. He said the tax incentive, which will cover up to 50 per cent of the capital cost of carbon capture projects, is what many heavy industrial companies have been waiting for in order to make a final investment decision.

“The Shell Polaris announcement last week was a direct result of the investment tax credit … it was a direct result of the royal assent on that,” Wilkinson said.

Carbon capture and storage (CCS) is a term for the use of technology to trap the harmful greenhouse gas emissions from industrial processes and store them safely in underground geological formations. Shell’s Polaris project, for example, will be designed to capture about 650,000 tonnes of carbon dioxide annually from the Shell-owned Scotford refinery and chemicals complex near Edmonton.

So far, Canada only has a handful of CCS projects in operation. Since 2000, these projects — which include an existing Shell project, called Quest — have stored about 44 million tonnes of CO2, the equivalent of taking more than 9.4 million cars off the road.