Carbon Capture and Storage – Potential, Risks, and Its Role in Low‑Carbon Hydrogen & Ammonia‍

CCS is not a silver bullet, but it is a proven, scalable tool to reduce emissions from hydrogen and ammonia production — sectors that are otherwise hard to decarbonize quickly.

In late 2025, a major carbon capture project in Norway reached a milestone: CO₂ was safely injected into a reservoir 2.6 km below the North Sea seabed.

This event – part of the Northern Lights initiative – highlights how Carbon Capture and Storage (CCS) is moving from concept to reality. CCS involves capturing carbon dioxide from industrial emissions and burying it deep underground, preventing it from entering the atmosphere. As countries race to decarbonize, CCS has emerged as a crucial (if sometimes controversial) tool to cut greenhouse gases while we transition to cleaner energy. This article explores CCS’s potential, its risks, and why it’s becoming an important bridge for low-emission hydrogen and ammonia production.

How CCS Works and Why It Matters

CCS is essentially a climate safety net: it grabs CO₂ at the smokestack and locks it away. In practice, CO₂ is captured from sources like power plants, refineries, or cement factories, then compressed and transported (via pipelines or ships) to a suitable site where it’s injected into deep geological formations (such as depleted oil/gas fields or saline aquifers). The appeal is straightforward – stop CO₂ from reaching the air, and you stop it from warming the planet. Leading energy organizations have concluded that achieving net-zero emissions by mid-century will be virtually impossible without CCS. In fact, climate models suggest carbon capture needs to scale up to gigaton levels (on the order of 5–7 billion tons of CO₂ per year by 2050) to meet global climate goals.

The good news: decades of research and field experience show that we have the geologic capacity and know-how to store CO₂ safely underground. Suitable storage sites (for example, deep sandstone reservoirs capped by impermeable rock) are well-characterised and abundant, providing confidence that CCS can be deployed at the scale needed.

Real-world projects are already validating CCS’s potential. For instance, Norway’s Sleipner project has been injecting CO₂ under the North Sea since 1996 with no leaks, storing roughly 19–20 million tonnes of CO₂ to date. Dozens of other facilities exist globally, and momentum is growing. In 2025, the Northern Lights venture – the world’s first open-access CO₂ storage service – began operations, initially able to store 1.5 million tons of CO₂ per year with expansion underway to 5 Mt/year. In Denmark, Project Greensand recently demonstrated the full CCS value chain by capturing industrial CO₂ in Belgium and permanently storing it beneath the Danish North Sea. Project Greensand aims to store up to 8 million tons annually by 2030, a contribution toward the ~300 Mt/year of CO₂ storage the EU estimates it will need by 2030. Meanwhile, the United States marked a milestone of its own in 2025: it has now injected a cumulative 1 gigaton of CO₂ into the ground over the past decades. This achievement showcases the capacity to handle enormous volumes of CO₂ – though reaching climate targets will require scaling up globally to several gigatons per year within the next two decades. The takeaway is that CCS is no longer theoretical; it’s happening at large scale, and each successful project strengthens the case that we can deploy this technology wherever it’s needed.

A Transition Tool for Low-Carbon Hydrogen and Ammonia

One of the most important roles for CCS is as a transition enabler for “difficult-to-decarbonize” industries and fuels. A prime example is hydrogen production. Today, most hydrogen is made from natural gas via processes like steam methane reforming – yielding significant CO₂ emissions (often called “grey” hydrogen). By applying CCS to these processes, the CO₂ byproduct is captured and stored, resulting in “blue hydrogen,” which has a dramatically lower carbon footprint. This is critical for expanding hydrogen use as an energy carrier: blue hydrogen provides a low-emission fuel that can be produced at scale now, bridging the gap until renewable “green hydrogen” (from processes like water electrolysis using renewable energy) becomes widely available. Likewise, ammonia – a chemical made from hydrogen and nitrogen – is central to agriculture (as fertilizer) and is emerging as a promising clean fuel and hydrogen carrier. However, conventional ammonia plants also generate large CO₂ emissions (natural gas-based ammonia production emitted ~450 million tons CO₂ in 2020, about 1.2% of global emissions). Here again, CCS offers a solution: capture the CO₂ during ammonia synthesis and you get “blue ammonia” with minimal emissions. In other words, by pairing existing ammonia facilities with CCS, producers can eliminate the vast majority of their CO₂ output. For example, ExxonMobil reports that its planned Baytown blue hydrogen/ammonia project will use advanced carbon capture to trap ~98% of CO₂ emissions from production. This means the ammonia from that facility will carry almost no carbon penalty – when used as fuel or fertilizer, it delivers its benefits without adding substantial CO₂ to the atmosphere.

Several projects are already leveraging CCS to decarbonize ammonia and hydrogen. In the US, major fertilizer manufacturers are retrofitting plants to capture CO₂ and send it to geological storage. In one case, a leading ammonia producer teamed up with ExxonMobil to transport and store hundreds of thousands of tons of CO₂ per year from its plant – effectively turning a high-emission facility into a low-carbon ammonia source. Blue ammonia shipments are now being inked into international contracts as well, destined for power companies to co-fire in coal plants or for use in ship fuel, all made possible because their production emissions are captured at the source. These developments show how CCS can accelerate the transition in sectors like energy and agriculture: instead of waiting perhaps a decade or more for 100% renewable-based hydrogen and fertilizers to scale up, we can slash the emissions of current production methods immediately. This not only buys time for clean energy deployment but also helps cultivate a market for low-carbon products (e.g. low-emission fertilizer) that rewards early movers.

Planned Real-World Projects Leveraging CCS in Hydrogen & Ammonia
  • NH3 Clean Energy’s WAH2 (Western Australia) – A planned clean ammonia facility designed with CCS from the outset, aiming to store ~0.9 Mt CO₂/yr.
  • Wabash Valley Resources (Indiana, USA) – Converting a gasification site into a hydrogen/ammonia facility with CCS to capture ~1.6 Mt CO₂/yr.
  • CF Industries Yazoo City (Mississippi, USA) – Adding CCS to capture up to 500,000 t CO₂/yr from ammonia production by 2028l.

Importantly, deploying CCS in hydrogen and ammonia value chains can bring financial as well as environmental gains. Emission reductions achieved via CCS can be quantified, certified, and even sold as carbon credits, providing an extra revenue stream or compliance benefit for project developers. Such “carbon services” – including lifecycle CO₂ assessments, low-carbon product certification, and verified emission reduction credits – can enhance a project’s bankability and profitability. In practice, this means a hydrogen or ammonia project that captures its CO₂ might get certified as low-carbon and earn tradable credits for each tonne avoided, improving its economics. Specialized carbon service providers (like FarmN, a carbon services provider) help project developers navigate this space – from conducting independent carbon footprint assessments to verifying and tracing carbon intensity certificates and developing carbon credits for the global carbon market. By tapping into these services, low-emission fuel and fertilizer projects can ensure their CO₂ savings are transparent, verified, and translated into added value for the business. In short, CCS not only cuts emissions but can also open doors to new funding and incentive opportunities that accelerate the adoption of clean technologies.

Addressing the Risks: Safety, Leakage and Public Perception

What about the risks of CCS? The idea of pumping CO₂ underground at large scale naturally raises concerns – could it leak back out? Could it cause environmental harm? These are valid questions, and extensive research has been done to answer them. A recent technical assessment by independent experts (IEAGHG and CSIRO) finds that while CO₂ leakage cannot be completely ruled out, the risk of any meaningful leakage from a well-selected storage site is extremely low. Decades of studies, field experiments, and natural analogues indicate that CO₂ can be stored securely in the right geologic formations. Potential leakage pathways (like old wellbores or unforeseen cracks) are well-understood and can be monitored and managed. In fact, no confirmed CO₂ leaks have been detected from any commercial CCS project to date, despite some projects operating for 10–20+ years. Even in worst-case scenarios, experts project that any leak would be small and dispersed, largely kept in check by natural trapping processes (dissolution in groundwater, mineralization, etc.). Moreover, CCS operations include robust monitoring systems – if sensors detect unexpected CO₂ movement, operators can intervene long before it becomes a problem, for example by adjusting injection pressure or repairing wells. The technologies and remediation techniques for well issues have been proven in the analog of the oil & gas industry, which has managed subsurface fluids for decades.

Public perception, however, remains a critical factor. Communities may worry about what they can’t see underground. This is why transparency and regulatory oversight are vital. Project developers are increasingly engaging with stakeholders to explain how storage sites are chosen and monitored, and regulators are enforcing strict measurement, reporting and verification protocols. The IEAGHG/CSIRO report emphasizes that climate anxiety and local concerns must be met with honest communication and visible safety measures. Where CCS is done, it’s done with continuous scrutiny – sites are typically monitored for many years (even decades) post-injection to ensure everything remains stable. All of this adds cost, but it’s essential for building trust in the technology. Ultimately, as the report concludes, the climate benefits of CCS far outweigh its localized risks. The far greater danger would be not deploying CCS at the scale needed, given the urgent threat of climate change. In other words, the risk of doing nothing is higher. With careful site selection, sound engineering, and community engagement, the risks of CCS can be managed to be vanishingly small – a message reinforced by the strong safety record so far.

CCS as Part of a Balanced Climate Strategy

CCS is not a silver bullet for climate change, but it is a powerful part of the toolkit. It offers a way to curb emissions from the industries we rely on – power, steel, cement, chemicals, fertilizers – without waiting decades to fully replace them with zero-carbon alternatives. It also provides a path to produce transitional fuels like blue hydrogen and ammonia that can jumpstart a low-carbon economy now. All of this comes at some cost and complexity, and it requires robust oversight. But the progress to date shows that CCS can deliver. Projects across the globe have successfully stored CO₂ in deep seas, under tundras, and in sandstone miles beneath our feet with no harm to people or ecosystems. The Northern Lights project in Europe, for example, is proving out a “carbon storage as a service” model – taking CO₂ from multiple companies and countries and locking it away. This kind of open infrastructure can multiply the climate impact by making CCS accessible to many emitters.

For developers of low-emission hydrogen and ammonia projects, CCS is enabling production of climate-friendly fuel and fertilizer at scale, today. And thanks to innovative carbon crediting mechanisms and certifications, the act of capturing and storing CO₂ can financially benefit these projects. This creates a positive feedback loop: the more CO₂ they store, the more value (in credits or premium product) they gain – which in turn justifies investing in more CCS. Many governments are also introducing policies (tax credits, grant funding, carbon prices) to support CCS deployment, reflecting its importance in national decarbonisation plans.

In summary, Carbon Capture and Storage holds significant potential to bridge the gap to a net-zero future. Its climate impact is immediate and tangible – every ton of CO₂ stored is a ton kept out of the atmosphere. The risks, often overstated in the public imagination, are in reality minimal and manageable with proper practices. And when linked with low-carbon hydrogen and ammonia production, CCS becomes a catalyst for cleaning up critical sectors like energy and agriculture without delay. As we push to limit global warming, every strategy will count. CCS is now proving it can be deployed responsibly at large scales, buying us valuable time and emissions headroom. By embracing this technology alongside renewables and efficiency measures, we equip ourselves with another much-needed tool to combat climate change – one that can neutralize emissions from today’s infrastructure while we build the clean systems of tomorrow.

Regional Considerations for Developers

Australia & Southeast Asia

  • Geology: Strong potential in offshore saline aquifers and depleted gas fields (e.g. North West Shelf, Bonaparte Basin).
  • Regulators: Offshore CCS overseen by NOPSEMA (Australia); in SE Asia, pilot regulatory frameworks are emerging (Indonesia, Malaysia).
  • Subsidies: Australia’s Hydrogen Headstart program and Safeguard Mechanism create demand; CCS hubs (like Angel CCS) offer shared infrastructure.

Europe

  • Geology: North Sea reservoirs are well-characterised, with decades of offshore oil & gas experience.
  • Regulators: EU CCS Directive and national authorities (e.g. Norway’s NPD).
  • Subsidies: EU Connecting Europe Facility (CEF) and Innovation Fund grants are financing storage hubs like Northern Lights.

North America

  • Geology: Vast saline aquifers and depleted oil & gas fields across the Midwest, Gulf Coast, and Alberta.
  • Regulators: U.S. EPA (Class VI well permits), Canadian provincial regulators.
  • Subsidies: U.S. Inflation Reduction Act boosts 45Q tax credits ($85–180 per tonne stored), making CCS economics more attractive.

Latin America

  • Geology: Large storage potential in Brazil’s offshore basins and Argentina’s Neuquén Basin.
  • Regulators: Still nascent; Brazil is developing a regulatory framework under ANP (oil & gas regulator).
  • Subsidies: Limited, but multilateral banks (IDB, World Bank) are exploring support for CCS pilots tied to hydrogen and ammonia exports.

Africa

  • Geology: High potential in South Africa’s Karoo Basin, North African offshore basins, and Nigeria’s Niger Delta.
  • Regulators: Early-stage; South Africa and Egypt are developing CCS readiness frameworks.
  • Subsidies: International climate finance (e.g. Just Energy Transition Partnerships, green hydrogen export incentives) may support CCS integration with ammonia plants.

Sources:

Northern Lights JV, “First CO₂ Volumes Successfully Stored in Aurora Reservoir” (News, Aug. 25, 2025)
Carbon Herald, “The Risks and Rewards of CO₂ Storage: New Report Finds Leakage Threats Are Manageable” (Sept. 20, 2025)
ExxonMobil, “Low-Carbon Ammonia: Reducing Emissions, Energizing Industry” (May 8, 2025)
SCI/Project Greensand, “Ineos and Wintershall Dea-led Consortium Stores CO₂ under Danish North Sea” (Mar. 10, 2023)
S&P Global, “US hits gigaton milestone in CO₂ injection” (May 09, 2025)
McKinsey & Co., “From green ammonia to lower-carbon foods” (2021)
Equinor, “Understanding carbon capture and storage” – Financial Times Partner Content
International Energy Agency (IEA), 2023 Net Zero Roadmap – Summary via Carbon Herald
Vattenfall, “Norway’s Sleipner: CO₂ buried in rock since 1996” (2022)