Transboundary legal issues in CCS - Economics, cross border regulation and financial liability of CO2 transport and storage infrastructure

A number of recent documents have stressed that if CCS is to make a significant contribution to the European Union’s climate change targets towards 2050, CO2 transportation networks that span across European boundaries will be necessary (IEA, 2009: Neele et al, 2011). During the demonstration phase of the technology, it is likely that CO2 pipelines will be built on a point to point basis within the national boundaries of the Member State. However, the general move towards offshore storage due to communication challenges with the general public in certain countries, the cost of characterising suitable offshore storage complexes and the potential demand for CO2 for the purposes of enhanced oil recovery in the North Sea, could mean that pipeline infrastructures and potentially CO2 shipping routes will be required to cross national boundaries.

However the transboundary movement of CO2, and the development of the infrastructure needed to make this happen, can only be realised once a number of legal issues have been resolved. A review of a number of pending transboundary legal issues, including financing and ownership, third-party access and financial liability form the basis of this report. In addition to these legal issues, potential ownership and investment approaches for CO2 transportation infrastructure are reviewed, and economic theories have been tested using a survey completed by industrial stakeholders.