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12 May 2022

$150m – the largest investment in Carbon Capture to date

Much as we hate to give publicity to yet-another carbon capture wannabee, we have to record another round of finance for Carbon Clean, a traditional Amine scrubbing company ostensibly based in London, which is emphasizing a “modular” easy to install design prefabricated off-site. It has raised $150 million this week it says from multiple investors, led by Chevron.

It now plans to put the technology to use in one of Chevron’s co-generation plants in San Joaquin Valley in California. Unfortunately all of the  San Joaquin Valley co-generation facilities owned by Chevron are used to provide steam which is injected into oil wells to get more oil out of the ground, and while the company is perhaps serious about decarbonizing its core activities, it cannot decarbonize the oil that people use to drive their cars.

$150 million seems a lot of money, and surely even rich oil companies cannot throw that type of money around. But when  you look at the list of companies in on the investment – Chevron, Cemex Ventures, Japan’s Marubeni Corp, AXA Investment, Samsung, Saudi Aramco and TC Energy from Alberta Canada (gas pipelines and turbines) alongside early investor Wave Equity Partners – you realize that $150 million is small change to keep the idea of carbon capture alive and well, so all of those investors can carry on Business-as-Usual.

Rethink first came across this company Carbon Clean about a year ago and we were deeply suspicious about its’ claims to have 44 installations around the world. A year on you’d think that number would have risen, but the website has not changed and the number has not risen.

It also contains a map showing just 15 demonstration and test sites, with only two live – both of these at chemical firms in India – which we believe to be Arcanum and Tuticorin Alkali Chemicals and Fertilizers – as these both offer endorsements on its website along with Tata Steel and Cemex.

A glimpse of the Companies House accounts shows that the company controls 100% of Indian firm Carbon Capture Technologies as well as Carbon Clean Solutions USA. While it does not reveal its revenues in its accounts, the balance sheet seems “uncluttered” for a company that has claims to have raised $30 million in the past, although it does have accumulated losses of £11.4 million since it began trading, and shows just under £9 million in liquid assets, which would add up.

In March Chevron told the world that it had carried out another funding round with Carbon Clean, but no figure was ever put on this and it has not appeared in the accounts of Carbon Clean. What has probably happened here is that a discussion about investment has been going on most of this year, and as Chevron and others have had massive profits due to the high price of oil, the company has looked for a “green” campaign to put money into to defray the idea of windfall taxation. That political need for an investment does not mean the process actually works and we still have reservations about the technique.

The key claims to this technology is that it can lower the cost of applying Amine based solutions considerably by making them fit industrial facilities of all sizes and also by bypassing a separate design stage and installing the technology in a modular way using a standardized system – essentially they say they can do a gigafactory in small carbon capture units and that this minimizes site disruption. The equipment is much smaller than a traditional open-plant system.

The technology is called CycloneCC and says it combines two technologies; an amine-promoted buffer salt solvent and rotating packed beds. When used together they ensure CycloneCC is more efficient than conventional carbon capture methods, reducing costs while matching performance.

CycloneCC, was only launched in October last year and Carbon Clean says it has a footprint ten times smaller than conventional carbon capture, can be deployed in eight weeks, cuts CapEx and OpEx by 50% and can reach the magic price point of $30 per ton which oil and gas have said they were chasing for years.

Merely matching past performance however is something of a problem, because so far the well understood chemical reactions with highly reactive amines combining reversibly with CO2, have a) never captured much more than 35% of any given source of CO2 and b) never gone close to being cheap enough. There is a belief that theoretically this can be increased to 90% once a cheap enough process is established, but only among committed natural gas engineers.

So this is supposed to be a learning curve relating to how easy it is to attach the well understood process, to a particular existing chemical stack. The company says it targets cement manufacture and steel making and other chemicals manufacturing and waste processing. So what’s it doing installing at a co-generation plant on an oil field?

Essentially Cement HAS to act as a base for Carbon Capture because the chemical process for making cement involves a chemical byproduct of CO2, as well as the use of a heat source traditionally provided by coal, and more often these days natural gas, which makes even more CO2.

Only about a third of the CO2 can be removed by shifting to use hydrogen for the heat source, that still leaves two thirds of the CO2 made chemically. Concrete made with cement continues to absorb carbon for the first 20 years or so that it is up, but this only mitigates a small amount of CO2 and capturing the remaining pure stream of CO2 and air from the exhaust gas of a cement kiln is a reaction that someone HAS to solve and it is a great candidate to build a carbon capture business around. However what most people still do not realize is that this will inevitably involve some compromises – the price of cement will HAVE to rise, and the fact that concrete continues to absorb CO2 for years should mean that 100% mitigation should not be needed – but something close will be settled on, and it will still potentially double the cost of cement.

Carbon Clean claims it has reached 1.5 million tons of carbon captured, and has just signed with one of the most mature carbon capture and storage and hydrogen projects in the UK, the Acorn Project, owned by oil interests in Aberdeenshire, which plans to store CO2 under the North Sea.

Aniruddha Sharma, Chair and CEO of Carbon Clean, said, “Carbon Clean’s vision is to deliver global industrial decarbonization on a gigaton scale, and we are now on track to do this by the mid-2030s. We are at the forefront of sector innovation, delivering products that can genuinely change the world. Today’s funding round is testament to the confidence of industry and global investors in our technology and its importance to reach net zero goals.”

We think this investment only goes to show how disgustingly profitable oil and gas companies are right now, and we think of this more as a mitigating greenwashing donation, rather than a genuine investment, with only the fact that Axa Investment is in there, which is duty bound to make profits from investments, making this look more like an arms-length investment process.