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)

Energy / Energy efficiency and conservation

Industry and trade / Large and medium industries

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

Feasibility assessment for large-scale YCCUSP completed

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.

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

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).

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.