Amsterdam — The Dutch government said on Friday it would commit 639 million euros ($726 million) to the construction of the country’s largest carbon capture and storage project, after TotalEnergies and Shell withdrew part of their planned investments.
The two oil majors have opted out of investing in the pipeline infrastructure necessary to connect industries to the storage sites in depleted gas fields under the North Sea.
In a bid to keep the project and its own climate goals on track, the government decided to step in to minimise risks for the two remaining investors, government-owned energy company EBN and Dutch gas grid operator Gasunie.
“This takes away a large part of the risk in the project,” climate minister Sophie Hermans said.
Shell and Total intend to remain involved in developing the storage sites and in offering storage and transport services to industrial clients, Gasunie said.
Their decision to change course comes as many European energy majors have weakened their climate goals and renewable energy targets to regain competitiveness against U.S. rivals that have kept their focus on oil and gas.
Shell and Total did not reply to requests for comment.
The final investment decision on the so-called Aramis project is expected in 2026. The storage, with an annual capacity of 22 million tons, should be operational by 2030.
That should help the Dutch government meet its own goal of reducing CO2 emissions by 55% in 2030, relative to 1990 levels.
Emissions were 37% lower than in 1990 last year, but the government’s main climate adviser has warned that the 2030 goal would be unreachable with current policies.
As part of an extra push, the government said on Friday it would earmark 8 billion euros next year in subsidies for sustainable energy projects. It will also introduce new subsidies on electric cars.
Industries, meanwhile, will be compensated for relatively high energy prices.
($1 = 0.8806 euros)
Reporting by Bart Meijer and Alban Kacher. Editing by Mark Potter – Reuters
