- Selection of nine leading specialist contractors across eight contract packages.
- Net Zero Teesside Power (NZT Power) aims to be one of the world’s first commercial scale gas-fired power stations with carbon capture.
- The Northern Endurance Partnership (NEP) aims to build the CO2 transportation and storage infrastructure to serve East Coast Cluster carbon capture projects.
- Final contract award will be subject to receipt of regulatory clearances and final investment decisions (FID) being taken in September 2024 or earlier.
15 March 2024: Net Zero Teesside Power (NZT Power) and the Northern Endurance Partnership (NEP) have selected contractors for engineering, procurement, and construction contracts with a combined value of around £4bn.
The selection of nine leading specialist contractors across eight contract packages is a major milestone for the Teesside-based projects, which would contribute to the UK’s journey towards net zero emissions by 2050.
Organizations
The final award of contracts is subject to the receipt of relevant regulatory clearances and positive Final Investment Decisions (FID) by the projects and UK government, planned for September 2024 or earlier. Following FID, the projects would be aiming for first commercial operations from 2027.
The contractors announced today are:
Onshore Power, Capture and Compression – Technip Energies and GE Vernova consortium including Balfour Beatty as the construction partner and Shell as the technology licensor
Onshore CO2 gathering system and gas connection – Costain
Linepipe – Onshore and Offshore – Marubeni-Itochu Tubulars Europe Plc with Liberty Steel Hartlepool, Corinth Pipeworks and Eisenbau Kramer GmbH as the nominated pipe-mills
Offshore Pipeline, Landfalls, Onshore Outlet Facilities and Water Outfall – Saipem
Offshore Subsea Injection System – TechnipFMC
Power and Communications Cable – Alcatel Submarine Networks
Offshore Systems Engineering – Genesis
Integrated Project Management Team – Wood
The projects represent a significant opportunity for the UK supply chain. The selected contractors will continue working with the local and regional supply chain, with further engagement taking place over the coming weeks and months.
NZT Power, a joint venture between bp and Equinor, could generate up to 860 megawatts of flexible, dispatchable low-carbon power equivalent to the average electricity requirements of around 1.3 million UK homes[1]. Up to 2 million tonnes of CO2 per year would be captured at the plant, and then transported and securely stored by the NEP in subsea storage sites beneath the North Sea. NZT Power could create and support more than 3,000 construction jobs and then require around 1,000 jobs annually during operations until 2050.
NEP, a joint venture between bp, Equinor, and TotalEnergies, is the CO2 transportation and storage provider for the East Coast Cluster (ECC). The Teesside onshore NEP infrastructure would serve the Teesside-based carbon capture projects – NZT Power, H2Teesside and Teesside Hydrogen CO2 Capture – that were selected for first connection to the ECC by DESNZ in March 2023 as part of the UK’s cluster sequencing process for carbon capture usage and storage (CCUS). It is anticipated that around 4 million tonnes of CO2 per year from these projects would be transported and stored from 2027.
Ian Hunter, Managing Director, Net Zero Teesside Power, said: “The selection of contractors is a major step forward for Net Zero Teesside Power. We have selected world-class partners who have the experience and capability needed to deliver. We aim to take final investment decision in September 2024 or before, after which we’d look forward to working with our EPC partners through the construction phase”.
Chris Daykin, General Manager, Northern Endurance Partnership, said: “The selection of contractors is a clear signal of momentum within the East Coast Cluster. The Northern Endurance Partnership’s CO2 pipelines are essential to connect carbon intensive projects to offshore storage and would play an important role in helping the region pursue its net zero plan”.
Ben Houchen, Tees Valley Mayor, said: “This would be the single biggest investment in Teesside since ICI. It cannot be understated the transformational economic impact this will have right across Teesside, Darlington and Hartlepool. Our area is now the world-leading centre in developing the clean, green industries of the future, which most importantly will deliver the highly-skilled well-paid jobs of the future. This investment of £4bn will support businesses up and down the local supply chain with companies like Hartlepool-based Liberty Steel already netting a multi-million pound contract. I will continue to work to ensure local British firms benefit from this colossal investment as this world first project moves forward to final investment decision in September this year”.
Ends
Stakeholders Reactions:
Partners
Louise Kingham, UK head of country and senior vice president, Europe, bp said “We’re pleased to see the projects reaching this latest milestone. Together with the recent award of the DCO, these moments bring the projects closer to the goal of supporting the UK government’s commitment to fully decarbonize the power system in the UK by 2035 and to help enable greater deployment of renewable power by providing flexible, dispatchable low-carbon electricity”.
Grete Tveit, Senior Vice President, Equinor, said: “We are delighted to be taking significant steps towards the realisation of these vital decarbonisation projects through the selection of experienced contractors. It marks another major stepping stone on our route towards a final investment decision and ultimately towards a net zero East Coast Cluster.”
Etienne Anglès d’Auriac, CCS Vice-President, TotalEnergies, said: “The selection of contractors for NEP will enable the East Coast Cluster to move forward at pace towards Final Investment Decision later this year. TotalEnergies is proud to be part of a frontrunner CCS project in the UK to sustain the decarbonization of an entire industrial region, a prerequisite for many players to remain competitive and sustainable, in the current fight against climate change.”
Ruth Herbert, CEO of the Carbon Capture & Storage Association, said: “It is fantastic to see this significant step forward for NZTP and NEP in their mission to develop a world-leading CCUS cluster in the North East. The signing of these contracts demonstrates the momentum behind the East Coast Cluster and positioning the UK as a global leader in CCUS. With this announcement, we can see the real-world impact that the development of CCUS will have on creating thousands of high-skilled jobs and securing investment into industrial regions across the UK. We now need confirmation of FIDs for Track-1 clusters from Government so projects like NZTP and NEP can take the next step in their mission to create jobs and help the UK reach net zero”.
Members of Parliament
Simon Clarke, Conservative MP for Middlesbrough South and East Cleveland, said: “This landmark announcement is not just a triumph for Net Zero Teesside Power and the Northern Endurance Partnership, but a monumental victory, all part of our positive plan for Teesside. I have supported carbon capture since I was first elected and I’m delighted to fully support these efforts to achieve final investment decisions by September 2024 so that we not only secure thousands of jobs for our constituents but also ensure our region remains at the forefront of sustainable industrial innovation.”
Andy McDonald, Labour MP for Middlesbrough, said: “Huge congratulations to Net Zero Teesside Power and the Northern Endurance Partnership for having reached this major milestone of concluding the arduous tendering and procurement processes and selecting the contractors for this vitally important project. As well as being such an important contribution to the UK’s net zero ambitions, this is a huge economic opportunity for the UK and locally based supply chains. With a combined value of some £4bn, this presents very significant employment opportunities and a demand for high level skills, all of which has the real potential to richly benefit our local workforce, our communities and economy. Many congratulations to BP, Equinor and TotalEnergies for reaching this stage and we await in eager anticipation the confirmation of the Final Investment Decision and the backing of government. This is such an important step in bringing this massively important project to fruition and a real cause for optimism.”
Jacob Young, Conservative MP for Redcar, said: “This £4bn investment demonstrates the confidence in our workforce, our businesses, and our collective ability to lead the charge in the UK’s ambition to achieve net zero emissions by 2050. The creation of thousands of construction and operational jobs is a testament to the project’s potential to transform our local economy and enhance our community’s quality of life. I am excited about the potential this project presents for local supply chains and for our young people, giving next generation sustainable jobs for life.”
Jill Mortimer, Conservative MP for Hartlepool, said: “This is fantastic news for Teesside and demonstrates how each surrounding town is playing their part to make our Freeport the best performing in the country. I’m proud that BP, one of the world’s leading international oil and gas companies, has recognised Teesside as the heart of the new Green Industrial Revolution and a great choice for investment. Such a large investment shows levelling up in action with a significant and positive impact on our local economy. We will see more leading global companies choosing the North East to invest, hundreds of new job opportunities for local families, and it will firmly cement Teesside on the map for innovation.”
Peter Gibson, Conservative MP for Darlington, said: “I welcome and celebrate all investment into our region particularly when this brings new jobs, new opportunities, and new technologies- today’s news is very welcome for Teesside and for our nation’s progress towards net zero.”
Alex Cunningham, Labour MP for Stockton North, said: “I warmly welcome the news of Net Zero Teesside and Northern Endurance’s £4bn investment in industry across Teesside. Teesside has always been at the cutting edge of industry in the UK and this investment ensures that we will remain at the forefront for years to come. The new carbon capture and storage facilities are a strategically important step forward in the fight against climate change and Teesside is rightly at the heart of the work to combat it. This is great news, not just for Teesside, but for the UK as a whole in striving towards our Net Zero targets and a cleaner, greener future. It will also bring huge added benefits by boosting the local economy with new, highly skilled and sustainable jobs. It is a great cause for optimism for the whole of the Tees Valley in training up the next generation for the green industrial jobs of the future. Congratulations to all of the companies involved in the bidding process and I look forward to the final sign-off of the project.”
Contractors
Martyn Curnow, Commercial Director, LIBERTY Pipes Hartlepool, said: “LIBERTY Pipes Hartlepool are extremely proud to have been selected to support this flagship project. As a UK-based manufacturer, we are committed to supporting job creation, and generating meaningful economic benefits, within the local community. LIBERTY Pipes Hartlepool has an extensive track record in the North Sea and now, in line with our long-term strategy, we are pleased to extend our involvement in support of new Energy Transition infrastructure. We look forward to delivering the project safely and to the satisfaction of our client.”
Ilias Bekiros, General Manager, Corinth Pipeworks said: “Innovative CCS projects such as NEP will be vital both to global energy producers and large industrial companies to achieve important sustainability targets. Corinth Pipeworks is delighted to be working alongside our partners and other NEP stakeholders to support on this technically challenging offshore pipeline scope.”
Luana Duffé, Executive Vice President, TechnipFMC, said: “We are proud to be involved in this milestone development. TechnipFMC will deliver the first all-electric subsea system using our integrated Engineering, Procurement, Construction, and Installation (iEPCI™) execution model and CO2.0® technology, an extension of our Subsea 2.0® platform. This project leverages TechnipFMC’s strong presence across the UK and demonstrates how our core competencies are essential to the energy transition.”
Arnaud Pieton, CEO, Technip Energies, said: “With our partners GE Vernova and Balfour Beatty, we are honoured to have been selected for the Net Zero Teesside Power project, the world’s first integrated power and carbon capture project. Together, we are committed to long-term investment in the UK and to support this flagship project, as it marks a huge step for the UK government’s commitment to decarbonising the country’s power system by 2035.”
Helen Coleman, Managing Director, Genesis, said: “Genesis is immensely proud to have been awarded the NEP Offshore Systems Engineering Services Project. This award confirms our market leading position in CO2 transport and storage services, where deep technical capabilities are essential to understanding the criticalities of projects and developing suitable de-risking strategies. Since 2019, Genesis has supported the East Coast Cluster from feasibility and FEED to Integrated System Engineering services. We look forward to continuing this long-established collaboration with our partners.”
Alain Biston, CEO, ASN said: ‘We are delighted to work in close cooperation with BP, Equinor and TotalEnergies on the development of a DC/FO system providing subsea control power and communications for NEP CO2 storage infrastructure. This project is the opportunity for ASN, leveraging on subsea telecom and power conversion technologies manufactured in the U.K., to contribute to the fight against global warming’.
Alessandro Puliti, Chief Executive Officer, Saipem said: “We are extremely proud to be the selected contractor for the offshore CO2 pipelines and associated facilities of NEP and NZT contracts. Saipem is fully committed to provide the best competences and its flagship vessel Castorone to support NEP and NZTP partnerships and contribute to the realization of the first zero-carbon industrial hub in the North-East of England and the achievement of the UK’s Net Zero targets.”
Alex Vaughan, CEO, Costain said: “This is an enormously important step forward for the UK in safeguarding our planet and unlocking sustainable economic growth, and we are proud that Costain has been selected to play an integral part in progressing the energy transition and decarbonisation agenda. Having completed the front-end engineering design (FEED) for this landmark scheme, we look forward to playing a key role in its implementation. This transformational solution will support economic growth, tackle climate change and improve lives.”
Julie Rae, Vice President, Wood, said: “Wood are delighted to be partnering with Net Zero Teesside Power and the Northern Endurance Partnership to support the development of programmes to reduce emissions, provide cleaner energy and capture millions of tonnes of CO2 a year. These programmes provide great opportunities for the next generation of engineers and we are proud to be part of the solution.”
Supporters
James Mackey, Managing Director, Climate Investment (CI), said: “Climate Investment is delighted to congratulate the NZT Power and Northern Endurance Partnership teams on reaching this important milestone, and we applaud their selection of these nine leading contractors to successfully deliver this innovative clean infrastructure project. As a specialized decarbonization investor, and an early investor in NZT, Climate Investment believes that CCUS hubs like NZT are a necessary and critical solution for carbon abatement in energy and industry.”
Dr V Bryony Livesey, ISCF Director – Industrial Decarbonisation, UKRI said: “This announcement of the key contractors who will support delivery of this flagship project is a major milestone, both for the project team and for the UK’s decarbonisation ambitions. The Industrial Decarbonisation Challenge, delivered through UK Research and Innovation, has supported the initial stages of development of this important project and is delighted to see it progressing towards construction and operation.”
Joanne Leng MBE, Chief Executive, NOF said: “Today’s announcement is an exciting milestone for the Net Zero Teesside Power and Northern Endurance Partnership projects, providing significant opportunities to both regional and UK supply chains. The projects could create and support up to 3,000 jobs during construction and NOF is proud to have worked closely with NZT Power on early regional supplier engagement activities and is looking forward to continuing to support this work as the projects move towards final investment decision in September this year”.
Joanne Fryett, Interim CEO, NEPIC said: “NEPIC are delighted to be working together with partners at Net Zero Teesside Power and the Northern Endurance Partnership to develop and bring to life the Tees Valley cluster plan. This announcement signifies a major milestone on the journey to reach net zero. At NEPIC we are proud of the support we have provided to date, and as the projects move towards FID in September this year we look forward to continuing to facilitate the regional supply chain engagement which is already underway”.
Daren Smith, Chairperson for the Industrial Teesside Net Zero Leader Group, said: “Today’s announcement is a major step forward for the Tees Valley Net Zero Cluster plan. I am delighted to see the selection of so many regional and national companies to participate in the construction of these critical projects, with extensive onward opportunities for the local supply chain – securing and creating skilled job opportunities for the area and bringing much needed income generation into the region. NZT and NEP continue to support the work of the Industrial Net Zero Leadership Group who are responsible for the delivery of the Net Zero Cluster Plan. I am very proud of the achievements of this group to date and excited for the future of the Tees Valley.”
Siobhan McArdle, Chair of the Tees Valley Business Board, said: “This is outstanding news for the region and delivers huge opportunities for our supply chains and local businesses. We are working closely with businesses of all sizes to develop and deliver the packages of support and skills development programmes they need so that they capitalise on the opportunities that come from this and other projects.”
Clare Jackson, CEO of Hydrogen UK, said: “Hydrogen UK welcomes this announcement as we wait for a positive FID. Progressing projects like NZT Power and the Northern Endurance Partnership is critical for the UK to reach its net-zero targets, as hydrogen is needed to decarbonise hard-to-abate sectors such as heavy industry. Hydrogen offers the UK an unprecedented opportunity to unlock economic growth, deliver inward investment, and not only protect but also create well paid, skilled jobs in areas like North East England.”
John Foster, Chief Policy & Campaigns Officer at the CBI, said: “The UK’s Industrial Clusters are a critical component in decarbonising to achieve our net zero ambitions. With the CBI and ECIU work revealing that the green growth economy grew by 9% in 2023, it is hugely encouraging to see the momentum behind the Teesside cluster’s net zero plans with the awarding of £4Bn of contracts associated with greening power production and capturing CO2 in the East Coast Cluster.”
[1] NZT Power’s ability to “generate dispatchable low-carbon power equivalent to the average electricity requirements of around 1.3 million UK homes” is based on average household consumption data from BEIS, ‘Subnational Electricity and Gas Consumption Statistics’, 22 December 2020 and total UK households equalling 27.8m, as stated in the Families and households in the UK: 2020 report published by the Office for National Statistics on 2 March 2021. Calculations assumes a load factor of 70% and an availability of 90%. ...
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