Baker Hughes' CarbonEdge: Transforming Carbon Capture Technology

Current state of carbon capture technology

Current carbon capture technology is evolving with early-stage projects aiming to capture significant CO2 volumes economically. Companies like ExxonMobil and SLB are developing integrated solutions, combining capture and sequestration, while advocating for necessary policies to stimulate market demand and infrastructure development.

"Together, these projects would pilot two early-stage carbon capture technologies with the aim to economically capture 278,000 metric tons of CO2 annually." --- (SLB, press release, 2024/04/19)

"I would say in Dan's business with the carbon capture and storage, he and his team are building a brand-new business. And so there are very few, I think examples of where the company is not only developing the technology and the infrastructure and logistics system, but also developing the capacity to supply, while developing the demand and developing the market in general, and advocating on, what I’d say, are the initial policies needed to get things kick started." --- (XOM, earning call, 2024/Q1)

"So combining sequestration and capture to offer this combined opportunity for the customers as technology solution and using the platform of the commercial carbon capture, Aker Carbon Capture, that exists today, is commercial, and using it as a platform to deploy and add and supplement this with new disruptive technology." --- (SLB, earning call, 2024/Q1)

"Over time, as it becomes more and more obvious that heavy industry and commercial transportation will not be meaningfully powered by renewables, the world will come to rely more on technologies where we have an advantage, including hydrogen, biofuels, and carbon capture and storage. A serious approach to the transition should focus on moving the world from high carbon to low carbon energy, not simply from oil and gas to wind and solar." --- (XOM, earning call, 2024/Q1)

"Find out more at slb.com. About Aker Carbon Capture Aker Carbon Capture is a pure-play carbon capture company with solutions, services and technologies serving a range of industries with carbon emissions, including the cement, bio and waste-to-energy, gas-to-power and blue hydrogen segments." --- (SLB, press release, 2024/06/14)

Baker Hughes' innovations and partnerships in CarbonEdge

Baker Hughes' CarbonEdge represents a significant innovation in carbon capture technology, integrating advanced risk management and digital monitoring. The company emphasizes collaboration with industry partners to enhance efficiency and reduce emissions, showcasing a strong commitment to achieving carbon negativity through strategic interventions and digital solutions.

"The launch of CarbonEdge makes Baker Hughes the only provider combining advanced risk management and reporting technology for measurement, monitoring and verification (MMV) of CO2 with comprehensive digital monitoring, engineering expertise and domain knowledge across surface and subsurface planning and operations." --- (BKR, press release, 2024/09/12)

"And we were fortunate and privileged that over the last year, senior leaders, including Noelle and her team have leaned in from across the business to develop over 80 interventions that are going to help us toward that carbon negativity roadmap and how we execute those." --- (MSFT, event transcript, 2024/08/05)

"And our team is eager to take on this opportunity with our long-standing partner Baker Hughes. 'This award is the latest important milestone for Baker Hughes in the LNG market, demonstrating the strength of our portfolio and our commitment to collaborating with industry partners while providing efficient and lower carbon solutions for the natural gas market,' said Ganesh Ramaswamy, executive vice president of Industrial & Energy Technology at Baker Hughes." --- (BKR, press release, 2024/04/05)

"CarbonEdge joins Baker Hughes' digital solutions such as JewelSuite, Leucipa™ and Cordant™, which span the energy and industrial value chains to increase efficiency, enhance operational predictability, and help ensure lower emissions." --- (BKR, press release, 2024/09/12)

"The first fully integrated digital offering within Baker Hughes' Climate Technology Solutions portfolio, CarbonEdge joins Baker Hughes' digital solutions such as JewelSuite, Leucipa™ and Cordant™, which span the energy and industrial value chains to increase efficiency, enhance operational" --- (BKR, press release, 2024/09/12)

Market demand and regulatory impacts on carbon capture

Market demand for carbon capture technology is expected to grow over 50% annually, driven by the need for effective sequestration solutions. However, challenges persist as low carbon energy struggles to keep pace with rising fossil fuel consumption, highlighting the critical role of regulatory support and technological advancements in shaping this market.

"I think we see this as a very attractive market for us considering the adjacency on the sequestration and considering the integration capability we have acquired and the technology we have acquired through Aker Carbon Capture. So the market independently and at this point, we see this market growing at more than 50% a year." --- (SLB, earning call, 2024/Q2)

"But low carbon energy is not growing is not yet growing sufficiently quickly to keep pace with increases in overall energy demand. As a result, the consumption of unabated fossil fuels, fossil fuels used without capturing and storing their emissions is continuing to increase alongside the growth in low carbon energy." --- (BP, event transcript, 2024/07/10)

"Similarly, discussion of future carbon capture, transportation and storage, as well as biofuels, hydrogen, direct air capture, and other plans to reduce emissions of ExxonMobil, its affiliates or companies it is seeking to acquire, are dependent on future market factors, such as continued technological progress, policy support and timely rule-making and permitting, and represent forward-looking statements." --- (XOM, press release, 2024/04/26)

"The level of expenditure required to comply with new or potential climate change-related laws and regulations and the amount of additional investments needed in new or existing technology or facilities, such as carbon capture and storage, is difficult to predict with certainty and is expected to vary depending on the actual laws and regulations enacted, available technology options, customer and consumer preferences, the company’s activities, and market conditions." --- (CVX, sec filing, 2024/Q1)

"But the rapid growth of electricity demand in many emerging economies means it's far harder to grow low carbon energy sufficiently quickly to both meet the growth in power demand and displace existing fossil fuel generation." --- (BP, event transcript, 2024/07/10)

Competitive landscape in carbon capture technology

The competitive landscape in carbon capture technology is evolving, with companies like Baker Hughes and ExxonMobil emphasizing innovation and cost competitiveness. Baker Hughes reports a significant order intake for carbon capture projects, while ExxonMobil highlights the need to align with market supply costs, indicating a race for technological advancement and market positioning.

"James West: Lorenzo, I wanted to touch back on carbon capture because it sounded like there was a bit of a shift in your tone there with respect to projects starting to move forward and to scale." --- (BKR, earning call, 2024/Q1)

"4th, innovative solutions, developing new products, approaches and technologies to improve competitiveness." --- (XOM, event transcript, 2024/05/29)

"  related to offshore oil and gas exploration, radioactive sources, explosives, chemicals, and climate-related initiatives; the inability of technology to meet new challenges in exploration; the competitiveness of alternative energy sources or product substitutes; and other risks and uncertainties detailed in this Form 10-Q and our most recent Form 10-K and Forms 8-K filed with or furnished to the SEC.  " --- (SLB, sec filing, 2024/Q1)

"And as you look at our order intake also on the new energy front, you can see from last year also that a large portion of our orders was associated with carbon capture, utilization and storage." --- (BKR, earning call, 2024/Q1)

"The question now is, can we be at a competitive point on the cost curve relative to where we see that next round of supply getting catalyzed to come into the marketplace." --- (XOM, conference, 2024/09/05)

Future outlook for carbon capture technologies

The future outlook for carbon capture technologies remains uncertain, with industry leaders acknowledging the unpredictability of policy and technological advancements needed to achieve net zero by 2050. Baker Hughes aims to leverage its technology portfolio for growth, indicating a proactive approach to innovation in this space.

"However, the Outlook does not attempt to project the degree of required future policy and technology advancement and deployment for the world, or ExxonMobil, to meet net zero by 2050." --- (XOM, sec filing, 2024/Q1)

"We can't predict the future. We know we can't predict the future. Rather, the 2 scenarios simply provide a rough sense of how the global energy system might evolve under different assumptions about the future: 1, in which the global energy system continues along its current pathway and another in which the world takes actions to drive emissions to net 0 by 2050." --- (BP, event transcript, 2024/07/10)

"Moreover, the Company's service and technology portfolio will be utilized as a springboard for future growth, both within drilling services and when pursuing opportunities towards adjacent industries such as renewables and mining." --- (BKR, press release, 2024/06/03)

"As such, the Outlook does not project the degree of required future policy and technology advancement and deployment for the world, or ExxonMobil, to meet net zero by 2050." --- (XOM, sec filing, 2024/Q2)

"Over time, we believe the world's demand for energy will continue to rise, and that hydrocarbons will play a major role in meeting the world's energy needs for the foreseeable future." --- (BKR, sec filing, 2024/Q1)

Case studies of successful carbon capture projects

Baker Hughes showcases its comprehensive capabilities in carbon capture, emphasizing successful projects that span from subsurface solutions to CO2 reduction and storage. ExxonMobil also highlights upcoming projects, indicating a robust pipeline of initiatives aimed at advancing carbon capture technology.

"Lorenzo Simonelli: Definitely. And the great thing about our portfolio, Stephen, is we're able to go across many of these New Energy projects really from the sub-surface all the way to the actually reducing the CO2 and being able to store it and being able to move it." --- (BKR, earning call, 2024/Q2)

"I think if you look at the big projects that we brought on today, all this portfolio projects we developed back in 2018, we're continuing to execute that." --- (XOM, earning call, 2024/Q1)

"So this is all very significant growth opportunity ahead of us here. Our first project, we expect to start off in the first half of next year." --- (XOM, conference, 2024/09/05)

Role of technology in reducing carbon emissions

Technology plays a crucial role in reducing carbon emissions across various sectors. Companies like SLB and GE are developing innovative solutions that enhance energy efficiency and optimize operations, while Baker Hughes emphasizes its commitment to providing products that support customers in their emissions reduction efforts.

"Through the use of these SLB technologies, Pioneer was able to increase drilling efficiency in addition to reducing carbon emissions." --- (SLB, press release, 2024/04/19)

"ARIA can optimize energy efficiency and reduce carbon emissions for commercial buildings." --- (AMZN, Twitter, 2024/04/02)

"The Open Fan is the most promising engine technology to help the industry reduce emissions, designed to meet or exceed customer expectations for durability and deliver a step change in fuel efficiency. Turning to some of the key takeaways on our second quarter performance." --- (GE, earning call, 2024/Q2)

"Our customers are clearly focused on reducing their emissions, and we have a broad suite of products to help them on this journey. With that, I'll turn the call over to Nancy." --- (BKR, earning call, 2024/Q2)

"We believe that we have to look for addition of capability to our portfolio, partially in the domain of pollution chemicals, in the domain of the lift solution, the domain of digital for pollution optimization and also to continue to address our quest for lowering emissions.So we believe that the complementarity of Chopin X portfolio from the strengths of the portfolio across pollution chemicals, from the application of digital that they have managed to do very well into their in North America particularly." --- (SLB, event transcript, 2024/04/02)