A company engaged in the development and production of oil and natural gas, JX Nippon Oil & Gas Exploration is opening up new avenues with its environmentally-friendly business centered on carbon capture, utilization and storage.
Created in a 2010 merger between Nippon Oil Exploration and Japan Energy Development, JX Nippon Oil & Gas Exploration (NOEX) specializes in the development and production of oil and natural gas, currently operating more than 30 projects in nine countries worldwide. The Tokyo-based company, which has offices in Australia, Indonesia, Malaysia, the U.A.E., the U.S. and Vietnam, is part of ENEOS Group, Japan’s largest energy, resources and materials conglomerate.
“Our main area of operations is Southeast Asia – chiefly Vietnam, Malaysia and Indonesia – as well as Papua New Guinea,” says NOEX’s president, Toshiya Nakahara. NOEX’s two core production sites are the Block 15-2 project in Vietnam, initially set up by company predecessor Mitsubishi Oil in 1992, and the Block SK10 project in Malaysia, established by Nippon Oil Exploration in 1987 and carried out in partnership with Petronas, the Malaysian state-owned oil and gas enterprise.
“At NOEX, we advocate a two-pronged approach focusing on oil and natural gas development and production as our ‘fundamental business’,” Mr. Nakahara says, “and as another prong, an environmentally-friendly business centered on carbon capture, utilization and storage (CCUS). We position this as a ‘growth business’, and have for many years spearheaded progressive measures to reduce CO2 emissions.”
Having successfully implemented an initial CCUS project in Vietnam in 2011, NOEX expanded its efforts three years later. It partnered with NRG Energy, a major U.S. electricity producer, to capture CO2 given off by a coal-fired power station in Texas, before injecting it into a nearby oil field. Known as Petra Nova, the project features the world's largest post-combustion carbon capture facility at a coal plant. “The system allows us to increase the oil field's daily production by about 300 barrels and also reduce the amount of CO2 emitted into the air,” Mr. Nakahara says. “There’s a strong need to reduce the carbon intensity of fossil fuel power generation – and CCUS technology is one of the major ways in which this can be achieved.”
As it looks to expand its use of CCUS technology, NOEX has launched joint study projects with partners in Australia, Indonesia and Malaysia, and with Japan targeting carbon neutrality by 2050, the firm is also planning domestic carbon capture initiatives. “There are no major oil fields around Japan,” Mr. Nakahara says. “However, we know we can accumulate and store CO2 in the seabed around Japan. By 2030, we’d like to realize the storage of CO2 underwater, and by 2050, we’d like to expand this business further. The government’s message is we have to make the utmost effort to achieve carbon neutrality. We have to strive to achieve that.”
When it comes to the company’s core business, NOEX’s focus is increasingly on natural gas. “It has a relatively low environmental impact, and demand is expected to grow,” Mr. Nakahara explains. However, he stresses that oil production must continue: “By 2050, oil demand should be reduced by half, but demand for oil as a feedstock for the chemical industry and other uses will remain. With regards to fuel sources, alternative energy sources are being explored, but I think the oil industry should be responsible for continuing to produce oil as a material for those industries and as a fuel in areas where it cannot be replaced.”