Status of CCS and CO2 Cross-Border
Transport in the ASEAN Energy Transition
Workshop on CO2 Cross-Border Transport and Storage (CCS) in Asia and the Pacific
8 February 2024
Presentation by:
Beni Suryadi
Manager
Power, Fossil Fuel, Alternative Energy and Storage

About ASEAN Center for Energy (ACE) & APAEC Phase II
ASEAN Center for Energy Role
Catalyst
To unify and strengthen ASEAN Energy
Cooperation by providing platform for sharing,
policy advisory, best practices, capacity building.

Knowledge Hub

ASEAN Plan of Action for Energy Cooperation (APAEC)
Phase II (2016-2025)
Focus

Program Area & Key Strategy
ASEAN Power Grid: Expand MPT, Grid resiliency andclean & renewable energy integration
Trans ASEAN Gas Pipeline : Develop Common Gas
Market by LNG connectivity and accessibility
Clean Coal Utilization: Optimize the role of Clean Coal inenergy transition

To provide a knowledge repository for ASEAN
Member States (AMS) and services throughdata Management, publication, dissemination.

Energy Efficiency: Reduce energy intensity by 32% in2025 based on 2005 level

Think Tank

Regional Energy Policy and Planning: Advance energy
policy and accelerate region’s energy transition &resilience

To assist AMS on research and identifying
practical & specific solution policies, legal &regulatory framework, technologies, innovativeSolutions

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Renewable Energy: Achieve 23% share of RE in ASEAN
energy mix and 35% share of RE in ASEAN installed
Capacity

Nuclear Energy: Build human resources capabilities onnuclear technology for power generation2Background
The total energy demand in Southeast Asia by country in Mtoe
2.000

Brunei Darussalam
1.500

Cambodia
Indonesia

1.000

Lao PDR
Malaysia

500

MyanmarPhilippines

02020 2025 2030 2035 2040 2045 2050

Projected as a significant contributor to global economic growth, theeconomies of Southeast Asia are expected to expand by an average of
4.6% in 2023 and 4.8% in 2024
The 7th ASEAN Energy Outlook suggests that the region's energy demand
will surge by approximately 30% by 2030 and will escalate by 170% by 2050
when compared to the levels of 2020. This trend implies an average annual
energy demand growth rate of about 3.4% throughout the region, continuing
until the mid-21st century.

Examining the total energy demand by fuel, fossil fuel still dominates theenergy demand in ASEAN. With the rising energy demand and the relianceon fossil fuel, it is predicted that GHG emissions are projected to reach
2,471 MtCO2-eq by 2025, with electricity and transportation contributing thehighest share through 2050.

Source: the 7th ASEAN Energy Outlook

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3Why ASEAN Need CO2 Cross Border Transport
Supporting Regional Blueprint•

Realize Net Zero target•

Most of the ASEAN countries havecommitted to carbon neutral or netzero emissions•As member countries align with theParis Agreement's ambitious climate
goals, CCS and CCUS emerge as
criticalsolutions,especiallyinindustries where emission reductions
are notoriously challenging.

Net Zero Target

Supporting
Regional Blueprint

Advancing
CCS/CCUS

CO2 Storage Hub

Advancing CCS/CCUS•Although countries have planned theimplementationofCCS/CCUSasspecified in the countries’ respectiveenergy plans, there are some limitations infully implementing CCS/CCUS, forinstance, the regulation to allow
transboundary of CO2 in ASEAN.
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This initiative is supporting the region’s
collective effort for energy cooperation,
under the ASEAN Plan of Action for
Energy Cooperation (APAEC) Phase II:2021-2025, Programme Area No.3 – Coaland Clean Coal Technology, specificallyfocusing on OBS 1, Action Plan 1.3. This
plan involves the development of aStrategic Coal Report and studies toexplore the potential of CCT and CCU/Sfor promoting a low-carbon energysystem.

•Indonesia and Malaysia are emerging as
pivotal CO2 storage hubs within theASEAN regions (BIMP-EAGA). Theirpotential to leverage the vast quantities ofCO2 storage capacity presents a unique
opportunity.

•Such efforts are also important for futuredecarbonisation from a global perspective

CO2 Storage
Hub4

Opportunities and Challenges on Cross-Border CO2 Transportation inASEAN for Advancing CCS Towards a Net Zero Future
Output I: Readiness of regulatory framework for climate change and CCS project in Indonesia,Malaysia, Thailand and Vietnam.

••••

Positioning of CCS in climate change policy
CCS Related Policies: Trends in consideration of carbon pricing such as emission regulations, carbon
taxes, emissions trading, and carbon credits that may lead to the realization of CCS projects
CCS Specific Incentives: Trends in the formulation of regulatory framework (including licenses andliabilities, etc.) for the realization of CCS projects
CCS Specific Legal and Regulatory Framework: Mapping local related organizations such as CCS
competent authorities

Output II: Challenges and Opportunities of CO2 cross-border transportation in the ASEAN region•••

Examples of cross-border transport of CO2 planned in the ASEAN region
Expected issues and benefits for each of the assumed exporting and importing countries
Potential recommendations to address the issues/challenges.

<Interviewee> Government officials, companies/ NOCs(National Oil Company) and think thank

One Community for Sustainable Energy5Current CCS specific policy, legal, regulatory and projects in selected
ASEAN countries
Indonesia

Malaysia

ThailandVietnam

International Climate ChangeCommitment

×√√√

Net Zero Target√√√√Party to the London Protocol

×××

CCS-specific domestic polices
or incentives√√√

CCS project(s) proposed/indevelopment√√√

CCS specific legal andregulatory framework

√√×

××××

√√

(one state)

Existing legislation applicable
to CCS operations

One Community for Sustainable Energy√√6Indonesia
CCS-related policy and regulatory framework
CCS in Climate
Change Policy(NDC)[Target] Reducing GHG emissions by 31.89% relative to the BAU scenario by 2030 and aconditional reduction is 43.2% with international support.
•NDC only mentioned CO2 capture in the petrochemical (especially ammonia production)and steel & Iron sectors

Indonesia Long-Term Strategy for Low Carbon and•

CCS-related Policy

Climate Resilience 2050

Decarbonize power sector by 2050 includes equipment most coal power plants withCCS/CCUS and biomass co-firing in coal power plants connected to CCS (BECCS)

Indonesian Ministry of Energy and Mineral Resources’ (MEMR) Roadmap to Net Zero
Emissions by 2060 in Energy Sector•Roadmap aims for the capture 6Mt-CO2 onwards from 2030, with the ultimate goal of
190Mt-CO2 in 2060

Presidential Regulation 98/2021 on Economic Value of Carbon

CCS-specificincentives
CCS-specific legaland regulatory
framework

One Community for Sustainable Energy•

Regulation reference CCS/CCUS as a mitigation and emission reduction activities•The new presidential regulation no 14 of 2024 mentioned about the plan to provide tax andnon-tax incentives for CCS/CCUS.

•MEMR Regulation No. 2 of 2023 on the implementation of CCS and CCUS for offshore oiland gas business activities•Presidential Regulation No. 14 of 2024 on the organisation of CCS. It includes regulationon the cross-border CO2 activities.

7Indonesia
CO2 cross-border transportation•The Indonesian government recently enacted the President Regulation No. 14 of 2024 that allow crossborder CO2 transportation and storage in Indonesia. It allows 30% of CO2 storage capacity to be utilizedfor captured CO2 from international sites, while 70% of the storage capacity is dedicated for captured
CO2 from domestic sites. The administration will be centrally governed by the Ministry of Environment
with National Registry System to promote fair trading and avoid double counting.
Comparison of MEMR Regulation No.2/2023 and New Presidential Regulation
MEMR Ministerial Regulation No.2/2023

New Presidential Regulation

Area• Limited on CCS/CCUS in O&G Working Area only

• Enabling CCS outside of the O&G Working Area.

Business Entity• Only conducted by O&G Contractor , based on Upstream O&G
Business Mechanism (Production Sharing Contract & Gross Split)• Opens up investment opportunities through 2 schemes: (1) Cooperation
Contract for CCS in O&G Working Areas, (2) Exploration Permit andStorage Operation Permit for CCS in the Carbon Storage Permit Areas

CO2 Sources• Open for CO2 sources from outside upstream O&G (for CCUS)• Enabling CCS with CO2 sources from other industries.
• Enabling Cross-border CCS.

CCS Implementation is carried out by O&G Contractors (K3S) intheir Working Areas through Cooperation Contract

ImplementationScheme• K3S can utilize their petroleum operations facilities and injection
target zones (depleted reservoir or saline aquifer) to receive carbon
from other K3S or other industries after the POD has been approvedby the MEMR
• CCS Implementation can be monetized through storage services(storage fees), storage fees are applied based on applicableregulations regarding taxation in upstream oil and gas businessactivities

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The implementation of CCS is carried out by Business Entities
BU/BUT) through the Exploration Permit and Storage Operation Permit
schemes in Carbon Storage Permit Areas••The government prepares Carbon Storage Permit Areas (based on
BU/BUT proposals or based on data processing), then offers the area tothe companies through auctions and limited selection
CCS implementation can be monetized through storage services, thegovernment gets royalties on storage fees8Indonesia: Potential CCS hub⚫ Indonesia is aiming to become the region’s CCS hub, with sufficient storage capacity
and strategic geographical position

Source: ICCSCOne Community for Sustainable Energy

9Malaysia
CCS-related policy and regulatory framework
CCS in Climate
Change Policy(NDC)•Enhanced NDC: Reduction in GHG emissions intensity of GDP by 45% relatives to theemissions intensity of GDP in 2005

•The commitment comprises a 35% reduction, on an unconditional basis, and a further 10% isconditional upon receipt of climate finance, technology transfer and capacity building fromdeveloped countries

CCS-related Policy

The 12th Malaysia Plan 2021-2025•

Highlights a necessary role for CCUS for the world’s fourth-largest LNG producers

Malaysia’s National Energy Policy (NEP) 2022-2040•Identify CCUS as a key emerging technology for Malaysia’s oil and gas sectorNational Energy Transition Roadmap: Energising the Nation, Powering Our Future•

CCS will deliver an additional 5% reduction in GHG emissions, which translates to 4.1
MtCO2eq per capita.

CCS-specificincentives•

Tax incentives for CCUS activities

CCS-specific legal
and regulatoryframework•There is not currently a CCS-specific legal framework at the national level in Malaysia

Land Code (Carbon Storage) Rules 2022•

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Sarawak Rules, only applicable in The State of Sarawak)

10Malaysia: Potential CCS Hub⚫ Despite not having developed any regulations on CCUS to allow cross-boundary CO 2transport, Malaysia has outlined its target to develop 3 CCUS hubs in its National
Energy Transition Roadmap (NETR)

Source: Malaysia NETR, 2023

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11Thailand
CCS in Climate Change
Policy (NDC)

CCS-related policy and regulatory framework
Reducing GHG emissions by 30% relative to the BAU level by 2030 and a conditional reduction is 40% withadequate and enhanced access to technology development and transfer, finance and capacity building•CCS-related Policy

NDC refers needs of RD&D for advanced technologies include CCS, CCUS BECCS, DAC, and hydrogen astechnology development and transfer.

Thailand’s Long-Term Low Greenhouse Gas Emission Development Strategy (LT-LEDS)•Formal mention of CCUS from 2040 and BECCS from 2050 as potential roles to support decarbonisation of
the national energy sector.

Carbon Neutrality in 2050 and Thailand Net Zero in 2065
•Depend mainly on emission reductions in energy sector including using CCUS technologies

The 13thNational Economic and Social Development Plan (NESDP) 2023-3027•CCUS technology is aligned to the NESDP strategic priorities No. 3 Eco-Friendly living and milestone No.10,“Circular economy and low-carbon society”

National Energy Policy (NEP2022)

CCS-specific incentives
CCS-specific legal andregulatory framework•Includes the role of CCUS technology as a critical decarbonisation tool to address Thailand's increasingenergy demand and greenhouse gas emissions•FS study on financial and incentive policies and business model based on CCUS Development Work Plan•

DMF will establish new activities of CCUS proposing to the Board of Investment (BOI) to get supportn.a.

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Thailand: Key CCS Projects• CCS pilot projects within E&P Business and beyond E&P Business in Thailand:

No1ProjectLampang

Operation/Collaboration

Status•DMF, EGAT, PTTEP

Mae MohPlanning and expected survey in2024-Namphong

EGAT

•

Finding financial support

Phu Horm

PTTEP

•EOR

3

Saraburi
Sandbox

SCG and DMF•Geological data review•4

Northern Gulf ofThailand/Kra Basin

Signing LOI and TOC between
JOGMEC and DMF
Start survey and prove the geologicalstorage capacity (2024-2027)

25

PTTEP, DMF,JOGMEC•ArthitPTTEP••A18MTJA-FEED, First injection will be on 2026
Expected to store up to 1 Mt-CO₂
during gas production at Arthit

Source: Ministry of Energy of Thailand

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13Vietnam
CCS-related policy and regulatory framework
CCS in Climate Change
Policy (NDC)

CCS-related Policy•

Unconditional 15.8% reduction of GHG emissions by 2030•

Conditional commitment to a 43.% reduction of GHG emissions. Compared to BAU•

NDC references to research and development of CCS technology for power plant and industrial production
facilities

Decision No. 896/2022/QD-TTg, “National Strategy on Climate Change (NSCC) for the period to 2050”•

Research and application of CCS technology for factories.

Decision No. 140/2020/NQ-CP, “The orientation of Vietnam’s National Energy Development Strategy for 2030,
with a Vision to 2045”•The application of EOR technologies in the production of primary energy sources is recommended.

•

In reducing emissions in the energy sector, the report mentions the development of mechanisms and policies forthe development of CO2 capture and utilization.

Decision No. 38/2020/QD-TTg, “List of high technologies prioritized for development investment anddevelopment promotion”•CCS-specific incentivesn.aCCS-specific legal andregulatory frameworkn.a

CCS technology is listed as prioritized high technology in the category of No.15 Environmental Energy

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14Vietnam: Key CCS Projects⚫ In 2011, Vietnam became the first country in Southeast Asia to successfully implement a project to increase
oil recovery using CO2 at Rang Dong field, Block 15-2, Cuu Long basin.
EOR Project at Rang Dong field, Cuu Long basin
CO2-EOR Huff n Puff Pilot Test in 2011
⚫ Rang Dong field, in Block 15-2 of the Cuu Long basin fromMay 19 to June 6, 2011
⚫ Achieved positive results with an increase in oil production
from 950 to 1,500 barrels per day
Joint study from 2013 to 2015
⚫ On a design of inter well CO2 -EOR pilot test at an oil field inVietnam offshore from 2013 to 2015 in order to understandthe applicability of CO2 -EOR associated with CCS.
⚫ The objectives of this study are to understand the CO2
injectivity, vertical sweep and areal sweep efficiency,
incremental oil production, injected CO2 volume andcost/risks.

JOGMEC concluded MOU with PetroVietnam
to seek further collaboration study on CCSDiscussions areunderway forsucceedingstudies toactualize CCS
project in VietNam.

Source: AZEC Progress Report 2023
https://www.meti.go.jp/press/2023/12/20231218004/20231218004-3.pdf

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Way Forward
Most ASEAN countries have not yet established CCS-specific legal and regulatory frameworks. This shortcoming isdue to common themes and shared challenges across the region, which include:•Challenges in enacting national policies for emission reductions as a policy enablers for CCS/CCUS•

Limited development of CCS-specific law and regulation across the region.

•Uncertainty regarding the administration of CCS operations in some jurisdictions

Advancing CCS and CO2 cross-border transport in ASEAN is a complex but essential task. To effectively approach
this, we can consider the following strategic actions among others:
••
•
•
•
•

•

Integration of CCS/CCUS technology in National Climate Policy and Long-term Energy Roadmap
Formulation of dedicated regulation on CCS/CCUS including the MRV following the closure of the project
Formulation of CCS-specific incentive policies
Establishing a public database of storage-related seismic and well data
Secure funding and investments, and establish a business model for the projectInternational collaboration to facilitate technology transfer, attract investments, and provide models for regulatory
frameworks.
Given the necessity of transboundary transportation of CO2, the need for regulations and agreements among
nations pertaining to carbon accounting, liabilities, and compliance with the London Protocol (where relevant)are also critical.

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16

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