Abu Dhabi Future Energy Company, or Masdar, has awarded a design contract for its project to capture carbon dioxide from Abu Dhabi industrial and power plants, as part of its plan to cut carbon emissions by one third by 2020. Abu Dhabi has all the ingredients to make the experimental technology work, because pumping the gas underground should also boost oil production and free up large volumes of natural gas for power generation. The government-owned alternative-energy company, a unit of Mubadala Development, announced yesterday it had selected Houston-based Mustang Engineering to provide front-end engineering and design services for the first phase of the project. It will be an emirate-wide pipeline network to transport carbon dioxide from industrial plants to oilfields, where the waste gas can be used in place of natural gas to maintain reservoir pressure, which is key to pushing more oil out of the ground. "This series of projects will reduce our carbon footprint and position Masdar and Abu Dhabi as global leaders in clean power," said Sultan al Jaber, the chief executive of Masdar. After being captured from industrial flue gases, pumped into oil reservoirs and recaptured from producing oil wells for re-injection - possibly several times - the carbon dioxide would eventually be stored permanently underground at the end of the reservoirs' commercial lives, completing a lengthy and costly process known as carbon capture and storage (CCS). In the first phase of Masdar's project, which is slated for start-up by the end of 2013, 5 million tonnes of carbon dioxide would be captured annually from a gas-fired power plant, an aluminium smelter and a steel mill, none of which has yet been built. Masdar would sell the gas to Abu Dhabi National Oil Company. Masdar said it selected Mustang, a subsidiary of the international energy-services company John Wood Group, because of its experience with carbon dioxide recovery and injection projects. The gas has been extensively used in US enhanced-oil-recovery projects, especially in Mustang's home state of Texas. However, in the US oil projects, injected carbon dioxide is not usually recovered from oil wells for final underground storage, so there is no environmental pay-off. Mustang's president, Steve Knowles, said the Abu Dhabi project would "complement" the firm's existing experience. "We are committed to the support of sustainable development and look forward to seeing the impact this project will have on the environment of the region," he said. The UAE emits 60 tonnes of carbon dioxide annually for each of its residents. According to a recent World Wide Fund for Nature study using government data, that makes it the world's worst per capita contributor to greenhouse-gas emissions. As part of a wider plan to cut power-sector carbon emissions, which account for about 43 per cent of the UAE's total carbon output, Masdar in January announced plans for a US$2.5 billion (Dh9.2bn) integrated power and CCS project with Hydrogen Energy, a joint venture between the British oil company BP and the Anglo-Australian mining group Rio Tinto. A decision on whether that project will go ahead is expected next year. Although there is no guarantee that either of Masdar's CCS schemes will be profitable, the company expects to offset the cost of carbon dioxide capture and transport from its sales of the gas for use in commercial oil projects. In the long run, analysts say, the profitability of CCS will depend on the market price of carbon emissions permits in regional cap and trade schemes to limit carbon emissions, or on the level at which governments set carbon taxes. tcarlisle@thenational.ae