Lift off for £4bn Net Zero Teesside Power scheme

Net Zero Teesside (NZT) Power, a joint venture between BP and Norwegian state energy company Equinor, has reached financial close and signed contracts worth £4bn with its supply chain.

NZT Power expects to start construction from mid-2025, with start-up in 2028.

It will proceed in tandem with the Northern Endurance Partnership (NEP), which has simultaneously entered  the execution phase of its CO₂ transportation and storage infrastructure to serve three initial carbon capture projects on Teesside as part of the East Coast Cluster.

Once operational, the combined cycle gas turbine electricity generating station could produce up to 742 megawatts of low-carbon power – equivalent to the average annual electricity requirements of more than a million UK homes.  

Up to two million tonnes of carbon dioxide per year will be captured at the plant, and then transported to secure subsea storage sites beneath the North Sea via infrastructure provided by NEP.

Building work on the two projects will be completed by nine engineering, procurement and construction (EPC) contractors across eight contract packages with a combined value of around £4bn. 

The contractors are:

• Onshore power, capture and compression – Technip Energies and GE Vernova consortium including Balfour Beatty as the construction partner and Shell as the technology licensor
• Onshore CO2 gathering system and gas connection – Costain
• Linepipe, onshore and offshore – Marubeni-Itochu Tubulars Europe with Liberty Steel Hartlepool, Corinth Pipeworks and Equans as the nominated pipe-mills
• Offshore pipeline, landfalls, onshore outlet facilities and water outfall – Saipem
• Offshore subsea injection system – TechnipFMC
• Power and communications cable – Alcatel Submarine Networks
• Offshore systems engineering – Genesis
• Integrated project management team – Wood

NZT Power says that it could create and support more than 3,000 construction jobs and then generate 1,000 jobs during operations. 

Balfour Beatty chief executive Leo Quinn said: “Net Zero Teesside is a transformational project, underpinning the UK’s transition to cleaner and greener energy consumption and driving regional economic growth in Northeast England. Today’s announcement takes us one step closer to realising this ambitious scheme, which will demonstrate collaboration at its finest and see us unite our unique strengths together with Technip Energies’ world-leading engineering and technology integration skills, Shell’s state-of-the-art Cansolv CO₂ Capture technology and GE Vernova’s unparalleled power generation knowledge.”

Craig Shanaghey, executive president of projects at Wood, said: “As a UK headquartered company, continuing to support a world-leading decarbonisation project in our own backyard is monumental. Our integrated team working closely with Net Zero Teesside Power and Northern Endurance Partnership is leading the energy transition by designing and advancing the energy ecosystem.”

Prime minister Keir Starmer sought to take credit for it all, even though the plans were drawn up and approved under a different government. “For far too long our industrial heartlands have been held back by 14 years of instability and low-growth. Working people deserve better. Today’s investment is proof that this government is taking a different approach by putting growth first and investing in the industries of the future.”

Ian Hunter, managing director of Net Zero Teesside Power, more accurately said: “Today’s announcement is the culmination of years of work to make Net Zero Teesside Power a reality.”

Equinor’s UK country manager, Alex Grant, said: “The UK is a key market for Equinor and we have a history of delivering significant energy provision along its East Coast, transitioning from traditional oil and gas demand to renewables and low carbon options including CCS and hydrogen. This is a major step for both Equinor and the UK, helping to decarbonise the country’s industrial heartlands and achieve its net zero ambitions whilst providing jobs and supply chain opportunities. We look forward to working with the new government to deliver further low carbon projects across in the UK.”

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