China, People's Republic of: Promoting and Scaling Up Carbon Capture and Storage Demonstration-Feasibility Assessment of a Large-Scale Carbon Capture and Storage Demonstration Project and Development Support to Yanchang Petroleum Group (Subproject 2)

Sovereign Project | 48453-009

The TA focuses on the feasibility assessment of a large-scale CCUS demonstration project at a coal-chemical plant of Yanchang Petroleum Group (YPG), which is identified in the road map and by NDRC as a priority demonstration project and is currently under development. The TA is well aligned with ADB's Strategy 2020 and its development agenda of achieving environmentally sustainable growth. ADB s country operations business plan, 2017-2019 named managing climate change and environmentally sustainable growth as strategic priorities of ADB assistance to the PRC.

Project Name Promoting and Scaling Up Carbon Capture and Storage Demonstration-Feasibility Assessment of a Large-Scale Carbon Capture and Storage Demonstration Project and Development Support to Yanchang Petroleum Group (Subproject 2)
Project Number 48453-009
Country / Economy China, People's Republic of
Project Status Active
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 9745-PRC: Promoting and Scaling Up Carbon Capture and Storage Demonstration-Feasibility Assessment of a Large-Scale Carbon Capture and Storage Demonstration Project and Development Support to Yanchang Petroleum Group (Subproject 2)
Carbon Capture and Storage Fund under the Clean Energy Financing Partnership Facility US$ 4.30 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Energy / Energy efficiency and conservation

Industry and trade / Large and medium industries

Gender Equity and Mainstreaming No gender elements
Description The TA focuses on the feasibility assessment of a large-scale CCUS demonstration project at a coal-chemical plant of Yanchang Petroleum Group (YPG), which is identified in the road map and by NDRC as a priority demonstration project and is currently under development. The TA is well aligned with ADB's Strategy 2020 and its development agenda of achieving environmentally sustainable growth. ADB s country operations business plan, 2017-2019 named managing climate change and environmentally sustainable growth as strategic priorities of ADB assistance to the PRC.
Project Rationale and Linkage to Country/Regional Strategy To meet its nationally determined contributions in line with the Paris Climate Agreement of 2015, the PRC has committed to achieve peaking of carbon dioxide (CO2) emissions by around 2030 and, by the same year, to decrease its carbon intensity by 60%-65% from its 2005 levels. The PRC is one of the few countries that have included CCUS in their nationally determined contributions. The PRC depends heavily on fossil fuels, which account for more than 85% of primary energy supply in the PRC. To diversify its energy mix, it has committed to increase the share of renewable energy to 15% by 2020, and to 20% by 2030. The government may also consider reining in emissions from fossil-fuel-based industrial and power plants by announcing more stringent emission standards. Since CCUS is currently the only available near-commercial technology that can abate 90% or more of CO2 emissions from fossil-fuel-based industrial and power plants, its early demonstration in multiple applications will help its timely deployment.
Impact

Innovative climate change mitigation technology of CCUS successfully demonstrated for further deployment in the PRC

Project Outcome
Description of Outcome

Feasibility assessment for large-scale YCCUSP completed

Progress Toward Outcome

Majority of the required deliverables have been either completed or under review.

Component 1:

- Completed: 18 deliverables.

- Under review: 2 deliverables.

Component 2:

- Completed: 10 deliverables.

- For preparation: 2 deliverables.

Implementation Progress
Description of Project Outputs

Technical support to 0.36 million tpa YCCUSP provided

Techno-economic feasibility of the 1.6 million tpa YCCUSP appraised

Capability of YPG in the field of sustainable project development as well as technical assessment of CO2 flooding and storage developed

Competence of YPG for safely implementing and operating the YCCUS project strengthened

Knowledge products on the YCCUSP shared and disseminated

Status of Implementation Progress (Outputs, Activities, and Issues)

The consulting firm, Battelle Memorial Institute, has been engaged since September 2020. Four individual consultants have also been engaged since January 2022 so that they can support the project executing agency and ADB to facilitate TA management and coordinate dialogue among the TA stakeholders. The TA has been back on track. The progress of each output by performance indicator is shown below.

Output-1:

1a. FEED study: Achieved (3 deliverables completed).

1b. Development of environmental and social impact assessment: To be achieved (TBA). 1 deliverable under preparation, and 1 deliverable completed.

1c. Preparation of safety assessment: TBA (1 deliverable under preparation).

1d&1e. Establishment of a technical optimization and risk assessment study on YCCUSP CO2-transportation pipeline: Achieved (1 deliverable completed).

1f. Report on innovative CO2-EOR technologies for enhancing recovery of immiscible oil: Achieved (1 combined deliverable completed)

1g. Establishment of a project implementation plan: Achieved (2 deliverables completed).

Output-2:

2a. Feasibility study report for 1.6 Mtpa project: Achieved (1 deliverable completed).

Output-3:

3a. Establishment of a measurement, monitoring, verification: Achieved (1 deliverable completed).

3b. Develop a mathematical model for immiscible CO2-EOR and storage in low permeability oil field in Ordos Basin: Achieved (1 deliverable completed).

3c. Prepare a report analyzing the CO2 storage potential of the oil field: Achieved (1 deliverable completed).

3d. Establish the energy penalty and net storage amount of the 1 million tpa YCCUSP: TBA (1 ongoing report review).

3e. Development of accounting and reporting methodologies on carbon reduction of YCCUSP: Achieved (1 deliverable completed).

3f. Establishment of a sustainable business model for YCCUSP: Achieved (2 deliverables completed).

3g. Preparation of a public acceptance and community involvement study: TBA (1 ongoing report review).

Output-4:

4a-4d: Achieved. All the 4 deliverables completed under the comprehensive capacity building session on 24-25 August 2022. More than 100 participants from MEE-DCC and YPG participated in the session. The participants benefitted from the knowledge shared by the TA consultants and prominent guest speakers in the field of CCUS from Canada and the United States. The training covered comprehensive topics on PRC's carbon neutrality policy, CCS business models, MMV (measurement, monitoring, and verification) and accounting methodologies, and the virtual project overview.

Output-5:

5a. 10 participants in international workshops increased understanding of CCUS: Achieved (6 deliverables completed under the combined capacity building session on 24-25 August 2022).

5b. Knowledge products produced: Achieved (2 knowledge products completed).

Geographical Location Nation-wide, Shaanxi, Xi'an
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design Keep close communication with the executing agency (the Ministry of Ecology and Environment, Department of Climate Change) and the implementing agency (Yanchang Petroleum Group).
During Project Implementation In close consultation and coordination with MEE and YPG, the TA made minor scope change in February 2022, after having extended the TA completion date to 16 October 2022. To expedite the implementation, multiple tripartite report review meetings were organized among MEE, YPG, the consultant, and ADB in February, July, and September 2022. Consolidated capacity building session was held on 24-25 August 2022 with more than 100 participants from MEE and YPG.
Business Opportunities
Consulting Services

The TA will engage widely respected experts in the field of CO2 capture, CO2-transport, CO2-EOR, CO2 sequestration, finance, economics, as well as social and environmental safeguards. ADB will be responsible for the selection and supervision of consultants engaged under the TA. In this regard, ADB will engage a consulting firm under quality- and cost-based selection on an output-based lump-sum contract to deliver outputs and activities under the TA._To facilitate TA management, four individual consultants will be hired using individual consultant selection (ICS) method. ADB will engage the consultants in accordance with ADB Procurement Policy (2017, as amended from time to time) and the associated project administration and TA staff instructions. In addition to the ADB project manager, one additional project manager will be hired for MEE DCC to (i) facilitate TA management; (ii) track and promote the implementation of the TA; (iii) coordinate the work of TA international and national consultants; (iv) facilitate the exchange of information, dialogue, and discussions between executing agency, implementing agency, consultants, and stakeholders; and (v) assist the day-to-day management of the TA. The project manager will be supported by two national project coordinators.

The TA has engaged the consulting firm, Battelle Memorial Institute, in September 2021 and the individual consultants required for TA management have been advertised.

Responsible ADB Officer Sakai, Atsumasa
Responsible ADB Department East Asia Department
Responsible ADB Division EASI
Executing Agencies
Ministry of Ecology and Environment former "Ministry of Environmental Protection"
Ministry of Ecology and Environment, Department of Climate Change
National Development and Reform Commission
Timetable
Concept Clearance -
Fact Finding -
MRM -
Approval 09 Jul 2019
Last Review Mission -
Last PDS Update 26 Sep 2022

TA 9745-PRC

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
07 Jun 2019 09 Jul 2019 09 Jul 2019 31 Oct 2021 16 Oct 2022 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 4,300,000.00 0.00 0.00 0.00 0.00 4,300,000.00 26 Sep 2022 1,787,189.19

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.


Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

Tender Title Type Status Posting Date Deadline
National Project Manager Individual - Consulting Closed 02 Sep 2021 08 Sep 2021
National Project Coordinator 1 Individual - Consulting Closed 02 Sep 2021 08 Sep 2021
National Project Coordinator 2 Individual - Consulting Closed 19 Jul 2021 01 Aug 2021
National Project Coordinator 1 Individual - Consulting Closed 19 Jul 2021 01 Aug 2021
International Project Manager Individual - Consulting Closed 19 Jul 2021 01 Aug 2021
National Project Manager Individual - Consulting Closed 19 Jul 2021 01 Aug 2021
Component 1: Carbon Storage and Enhanced Oil Recovery and Component 2: Carbon Capture Firm - Consulting Closed 17 Dec 2019 31 Jan 2020
Storage and Enhanced-Oil-Recovery Component Firm - Consulting Closed 11 Jun 2019 31 Jul 2019
Carbon Capture Component Firm - Consulting Closed 11 Jun 2019 31 Jul 2019

Contracts Awarded

Contract Title Approval Number Contract Date Contractor | Address Executing Agency Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
Capacity Development Technical Assistance 9745 10 Sep 2020 Battelle Memorial Institute(UNITED STATES) | 505 King Avenue, United States Columbus OH 43201-2696 United States Min of Ecology &Environment,Dept of Climate Change 3,842,724.00

Procurement Plan

None currently available.