Shell, which is also involved in the Chevron Corporation-operated Gorgon CCS project on Barrow Island, Western Australia, is planning to use the field, which is 100km offshore, to capture the emissions from a gas-fired power plant operated by energy generator SSE.

The big European concern is seeking the release in UKP$1 billion ($A1.3 million) in subsidies for development of the project.

Shell argues that CCS is an essential transitional technology that will allow fossil fuels to meet the majority of the world’s energy needs during the transition to greener and renewable sources of energy.

The Goldeneye platform, which would be used to support the Peterhead CCS project, has been on care and maintenance since 2011.

If developed the project would be more than capable of handling the emissions of the Peterhead project, and would allow other depleted North Sea fields to be used for storage.

Of course, the technology is controversial and needs to be proven at the commercial scale, but in theory the idea of re-injecting carbon dioxide should work given gas reservoirs do a pretty good job of trapping methane, carbon dioxide and other gases naturally

Economically they may also not work without some sort of price signal, such as a carbon tax.

Indeed, Gorgon is only going ahead because it was a development requirement to offset the LNG plant’s massive carbon dioxide emissions and the 14% carbon dioxide from the Greater Gorgon fields.

Construction started on Gorgon’s CCS project in 2009 and while carbon dioxide injection was originally expected to begin this year, that has been delayed until 2016.

Up to 3.4 million tonnes per annum of carbon dioxide will be captured, piped and stored in the deep Dupuy Formation below Barrow Island as part of the 15MMtpa Gorgon project.

Shell intends to make a final investment decision on Petershead by the end of the year, having been recently granted planning permission for the onshore elements by Aberdeenshire Council.

It was a significant milestone for the project, which will inject up to 10MMtpa of carbon dioxide emissions for up to 15 years could be captured from the Peterhead Power Station and transported by pipeline offshore for long-term storage deep under the North Sea.

Adding CCS to a gas power plant can reduce carbon dioxide emissions by more than 90%. In addition, CCS is the only way to collect the carbon dioxide from heavy industry, such as cement and other industrial facilities.

In March 2013, the Peterhead CCS project was chosen as one of two CCS demonstration projects, with Drax Group’s North Yorkshire power project, to progress to the next stage of the government’s CCS commercialisation competition funding.

That project is now in the front-end engineering design phase.

The International Energy Agency says more carbon dioxide is locked in known fossil fuel reserves than the world can emit without risking dangerous levels of climate change.

No single commercial-scale project has yet begun operations in Britain eight years after the government pledged to help pay for a demonstration project.

Critics of the technology argue the technology encourages further use of fossil fuels and is so new it had not been fully derisked.

There are two operating large-scale CCS operations in the world.

The Boundary Dam project, in Saskatchewan, Canada, uses the post-combustion Shell CANSOLV carbon dioxide system, the same system proposed for Peterhead project, and is already performing above expectations after three months.

Around 135,000t of carbon dioxide has now been injected.

It is the world’s first commercial-scale post combustion carbon capture project at a coal-fired power plant late last year.

Before year’s end Shell also expects that its Quest CCS project in Alberta will be switched online, taking 1MMtpa of carbon dioxide of by-product from the Athabasca oil sands.

Accelerating plans for carbon capture in the North Sea could provide a much-needed lifeline for the region’s offshore sector, a new report suggests.

A recent study by Edinburgh University says storing carbon from industries such as Teesside’s pharmaceutical sector in the spaces left by oil extraction under the North Sea could provide the benefits needed to kickstart new exploration in the area.

The report said that projects that brought carbon capture closer together with subsea exploration would extend the life of the North Sea oil fields, reduce imports of oil and gas, maintain employment and develop the UK’s export capability.