Carbon Capture, Utilization, and Storage Market

As a greater number of new CCUS facilities begin operations each year, confidence in the technology continues to grow, leading to an increasing number of projects. The current pipeline features hundreds of capture sites, which range from natural gas processing plants and cement facilities to hydrogen hubs and direct air capture units. This expansion is pushing operational capacity to exceed 50 million tons (55.11 million tons) of CO2 annually, with ambitions to surpass 400 million tons (440.9 million tons) by 2030. Simultaneously, planned storage installations offer approximately 670 million tons (738.5 million tons) of underground capacity, reflecting a 10% increase compared to last year.

The high cost of carbon capture and sequestration remains one of the major barriers to market growth. This is particularly significant in developing countries and low-margin industries, as it directly impacts the economic feasibility of projects. Capturing CO2 requires advanced equipment, specialized materials, and a substantial energy input, all of which contribute to increased operational costs. The cost of capture can vary widely, typically ranging from tens to over a hundred dollars per ton, depending on the technology used and the concentration of CO2 in the emission stream. Sequestration adds further expenses due to the need for compressing CO2, transporting it through pipelines, and ensuring its secure long-term storage underground. This process also involves extensive site characterization, ongoing monitoring, and adherence to regulatory requirements. For many companies, especially those in hard-to-abate industries, the total costs often surpass short-term economic returns unless they are offset by significant government incentives, carbon pricing, or financial benefits from CO2 utilization..

The recent wave of large-scale hydrogen projects presents a significant opportunity for the CCUS industry because blue hydrogen production inherently generates high-purity CO2 streams that are far easier and cheaper to capture than dilute emissions from conventional power plants or industrial processes. As project developers finalize final investment decisions on multi-billion-dollar hydrogen facilities in North America, Europe, and Asia, they commit not only to separating hydrogen from natural gas but also to installing associated capture units capable of handling hundreds of thousands to millions of tons of CO2 per year. These projects establish key customers for transport infrastructure, including pipelines, shipping terminals, loading hubs, and dedicated storage sites like depleted reservoirs or saline aquifers.

Financing a full-scale CCUS project means allocating hundreds of millions of dollars before a single ton of carbon is captured, creating a formidable barrier for developers. Every stage demands specialized work: outfitting plant exhaust with capture modules, laying pipelines for CO2 transport, building compressor stations, and preparing underground reservoirs with drilling and monitoring equipment. Site characterization alone can cost tens of millions, and unforeseen geological challenges often surface only after wells are drilled. These upfront expenditures occur long before revenue from carbon credits, enhanced oil recovery, or industrial CO2 sales begins to flow.