New Oil Fields Should Have to Build the Carbon Storage Market

The discussion surrounding new oil and gas fields often results in a stalemate. Those in the industry claim continued production is necessary for years to come, supporting jobs and reducing reliance on imports. Conversely, climate advocates assert that each new field locks in emissions incompatible with achieving net zero. Carbon capture and storage (CCS) is frequently mentioned as a potential solution, either as an excuse to continue extraction or a costly public project independent of the license approval process.

However, a more beneficial approach exists. If a government determines a new oil or gas development is necessary, they should require the producer to fund the permanent geological storage of an increasingly larger share of the carbon contained within the product. This should not be a vague promise of CCS readiness or a voluntary target for 2040.

Instead, it should be a quantifiable carbon storage requirement attached to the right to produce. This approach could address one of the most significant commercial challenges in carbon capture: while everyone agrees storage will be needed, too few parties are legally obligated to purchase it. The UK's reassessment of the Rosebank oil field and Jackdaw gas field exemplifies the contradiction.

Their previous approvals were revoked after a court ruled that environmental assessments failed to account sufficiently for emissions generated when the fuels are ultimately burned. An open letter signed by over 150 academics and professionals argues that any renewed approval should include a legally binding carbon storage obligation.

This obligation should be based on the carbon eventually released from the fuel sold, not just emissions generated during extraction. The UK estimates that its continental shelf may contain around 78 billion tonnes of theoretical CO storage capacity. However, global commercial capture capacity reached only about 64 million tonnes per year in 2025, creating a considerable gap.

This obligation would create a market for storage, providing both the resources and subsurface expertise necessary to deliver it. A carbon takeback obligation, similar to those already in place for other industries, would hold the producer responsible for returning an increasing fraction of the carbon to secure geological storage.

This could be achieved through capturing emissions from the exact vehicle, boiler, or aircraft using the fuel, or by procuring verified permanent storage from various sources, provided the CO would otherwise have entered the atmosphere.