BP said the project, which would make use of a power station in northern Scotland and export the carbon dioxide to a North Sea oil reservoir, would require total capital investment of some US$600 million (euro497 million). 

Initial engineering feasibility studies have been completed, BP said, and the partners are now working to confirm the economic viability of the project. 

BP said it expects that review to be completed in the second half of 2006, allowing a final investment decision to be made next year. If approved, the group plans to start operation of the project in 2009. 

"This is an important and unique project configured at a scale that can offer significant progress in the provision of cleaner energy and the reduction of carbon dioxide emissions,'' said BP Chief Executive Lord Browne. 

"For example, if applied to just 5 percent of the new electricity-generating capacity that the world is projected to require by 2050, such schemes would have the potential to reduce global carbon dioxide emissions by around 1 billion tons a year -- a material step in the challenge the worlld faces,'' he added. 

In its March 2005 budget, the British government announced that it is examining the potential for new economic incentives to support the development of carbon capture and storage technologies and applications. 

The BP-led project would convert natural gas to hydrogen and carbon dioxide gases, then use the hydrogen gas as fuel for a 350 megawatt power station near Peterhead, northern Scotland, and export the carbon dioxide to a North Sea oil reservoir for increased oil recovery and ultimate storage. 

When fully operational, the project would be expected to capture and store around 1.3 million tons of carbon dioxide each year and provide 'carbon-free' electricity to the equivalent of a quarter of a million U.K. homes. BP said the project would reduce the amount of carbon dioxide emitted to the atmosphere by the power generation by over 90 percent.

~