Carbon Capture in the Gulf: Progress, Costs, and the Road to Commercial Viability

CCUS in Context: Why the Gulf Leads

Carbon capture, utilisation, and storage (CCUS) occupies a peculiar position in the climate debate. For some, it is an indispensable transitional technology — the only proven route to decarbonising hard-to-abate industrial processes. For others, it is a moral hazard that perpetuates fossil fuel dependence. In the Gulf Cooperation Council states, this debate is not academic; it is existential.

The GCC's hydrocarbon economies face a dual imperative: meet growing international pressure to reduce emissions while maintaining the revenue streams that underpin national development. CCUS appears to offer a path through this tension. And the region has moved faster than most in deploying it at scale.

The GCC's Major CCUS Projects

Qatar: LNG Carbon Capture

Qatar's approach to CCUS is inseparable from its liquefied natural gas (LNG) strategy. QatarEnergy's Ras Laffan Industrial City hosts carbon capture facilities integrated into LNG processing trains that strip CO₂ from natural gas before liquefaction — a process that produces a relatively pure CO₂ stream well-suited to capture.

The country's planned North Field Expansion — which will increase LNG capacity from 77 to 126 million tonnes per annum — includes CCS as a core design parameter. QatarEnergy has committed to capturing and sequestering approximately 11 million tonnes of CO₂ per year once the expansion is fully operational, which would make Qatar one of the largest CCS operators globally.

Critically, Qatar's geology provides favourable storage conditions. Deep saline aquifers in the Khuff and Arab formations offer substantial theoretical storage capacity, though detailed characterisation work continues.

UAE: Al Reyadah — The Region's Pioneer

The Al Reyadah facility in Abu Dhabi, operational since 2016, captures approximately 800,000 tonnes of CO₂ per year from the Emirates Steel Industries facility. The captured CO₂ is compressed and transported via a 43-kilometre pipeline to ADNOC's oil fields for enhanced oil recovery (EOR).

Al Reyadah was the first commercial-scale CCS project in the Middle East and remains the region's most visible reference case. Its operational track record — over five years of continuous operation — provides genuine data on capture rates, energy penalties, and maintenance requirements that inform subsequent projects.

Saudi Arabia: Jubail Hub and Uthmaniyah

Saudi Aramco's Uthmaniyah CO₂-EOR demonstration project captured roughly 800,000 tonnes per year from the Hawiyah natural gas liquids recovery plant. The broader Jubail CCS hub concept envisions clustering multiple industrial emitters — petrochemical plants, steel mills, and refineries — around shared transport and storage infrastructure.

Saudi Arabia's ambition extends further: the Circular Carbon Economy framework, championed during the Kingdom's G20 presidency in 2020, positions CCUS as one of four pillars (alongside Reduce, Reuse, and Recycle) for managing carbon.

Cost Curves: Where Does CCUS Stand?

The economics of CCUS vary enormously depending on the CO₂ source concentration, the transport distance, and the storage or utilisation pathway. Current cost ranges across the GCC can be summarised as follows:

Gulf-specific advantages include low-cost energy (reducing the parasitic energy penalty), proximity of industrial clusters to potential storage sites, and existing pipeline infrastructure. However, the region's high ambient temperatures reduce the efficiency of amine-based capture solvents and increase cooling requirements — a factor often underestimated in technology transfer from temperate-climate projects.

The Learning Rate Question

Unlike solar photovoltaics or wind turbines, CCUS has not demonstrated a consistent learning curve. Global capture costs have declined only modestly over two decades of deployment. The International Energy Agency estimates a learning rate of approximately 5–10 per cent per doubling of cumulative capacity — far below the 20–25 per cent rates observed in renewable energy.

This sluggish cost reduction is partly structural: each CCUS installation is bespoke, with limited opportunities for mass manufacturing. Modular capture units and next-generation solvents may change this trajectory, but the evidence is not yet compelling.

The CO₂-EOR Credibility Question

This is the most contentious issue in Gulf CCUS. Every major operational project in the GCC injects captured CO₂ into oil reservoirs for enhanced oil recovery. The argument for counting CO₂-EOR as climate mitigation runs as follows: the CO₂ is permanently stored underground, and the additional oil produced would have been extracted by other (potentially more emission-intensive) means anyway.

The argument against is equally straightforward: injecting CO₂ to produce more oil creates a net increase in carbon entering the atmosphere when that oil is combusted. Life-cycle analyses consistently show that CO₂-EOR is, at best, a partial mitigation measure. A 2021 study published in Nature Climate Change estimated that for every tonne of CO₂ stored via EOR, between 0.4 and 0.7 additional tonnes are emitted from the combustion of the recovered oil.

The accounting treatment of CO₂-EOR is not merely a technical question — it determines whether the GCC's largest CCUS investments count toward national climate commitments or are reclassified as production optimisation.

For GCC nations reporting under their Nationally Determined Contributions (NDCs), this distinction matters. Qatar's updated NDC references CCUS as a mitigation measure, but the methodology for calculating net abatement from EOR-linked projects remains ambiguous under Article 6 of the Paris Agreement.

CCUS and NDC Delivery

All six GCC states reference carbon capture in their climate strategies, but the degree of dependence varies:

• Saudi Arabia: CCUS is central to the Kingdom's net-zero-by-2060 target, with a planned 44 MtCO₂/year capture capacity.
• UAE: Targets 5 MtCO₂/year by 2030 under the Net Zero 2050 Strategy, with ADNOC's operations providing the anchor demand.
• Qatar: Integrates CCUS into LNG expansion plans, framing low-carbon LNG as a destination fuel rather than a transition fuel.
• Kuwait, Bahrain, Oman: At earlier stages of CCUS planning, with feasibility studies underway but no operational projects.

The risk is that over-reliance on CCUS creates a "mitigation gap" if deployment timelines slip or costs do not decline as projected. History suggests this is a real concern: globally, more CCUS projects have been cancelled or mothballed than have reached final investment decision.

What Should GCC Companies Be Doing Now?

1. Develop Rigorous Carbon Accounting

Any company claiming emissions reductions through CCUS must be able to demonstrate net lifecycle abatement, not gross capture volumes. This requires transparent accounting of energy penalties, transport emissions, fugitive losses, and — for EOR projects — the downstream emissions from recovered hydrocarbons.

2. Invest in Storage Characterisation

The GCC has substantial theoretical CO₂ storage capacity in depleted reservoirs and saline aquifers, but "theoretical" and "bankable" are different categories. Detailed geological characterisation — seismic surveys, injection tests, monitoring protocols — is needed to convert resource estimates into certified storage capacity.

3. Plan for Dedicated Storage

As carbon markets mature and regulatory scrutiny intensifies, projects relying solely on EOR utilisation will face increasing credibility challenges. Companies should develop pathways to dedicated geological storage as a complement to, and eventually a replacement for, EOR-based disposal.

4. Engage on Article 6 Rules

The operationalisation of Article 6 of the Paris Agreement will determine how CCUS credits are treated in international carbon markets. GCC governments and companies should actively participate in shaping these rules, particularly around additionality, permanence, and the treatment of EOR.

The Verification Imperative

As CCUS projects scale, the need for independent, third-party verification of capture rates, storage integrity, and net abatement becomes critical. ISO 14064 provides the established framework for GHG quantification and verification, but CCUS-specific guidance — particularly around long-term monitoring and liability transfer — is still evolving.

GSustain, as an ISO-certified environmental consultancy operating across the GCC, recognises that CCUS will be a significant component of the region's climate strategy. Our role is to ensure that the claims made about these projects — whether in NDC submissions, corporate sustainability reports, or carbon credit registrations — are grounded in rigorous, independently verified data.

Conclusion

Carbon capture in the Gulf is real, operational, and scaling. But the technology's contribution to genuine climate mitigation depends entirely on how it is deployed, accounted for, and governed. The GCC has the geological advantages, the financial resources, and the industrial infrastructure to make CCUS work — but only if the region moves beyond treating captured CO₂ primarily as an input to oil production and begins building the dedicated storage infrastructure that credible decarbonisation demands.