Baker Hughes Co. is joining a carbon storage project under development in the Arctic, the Houston-based company said, as one of the world’s largest oilfield service firm’s focus on new energy intensifies.

According to a company announcement on March 23, Baker Hughes signed a memorandum of understanding with Horisont Energi AS to collaborate on the Polaris carbon storage project off the northern coast of Norway in the Barents Sea. As part of the partnership, the companies also plan to explore new processes and technologies across the carbon capture, transport and storage (CCTS) value chain for the energy industry.

“With this announcement, Baker reminds us how well-suited (and well-versed) they are in carbon capture, storage and sequestration,” analysts with Tudor, Pickering, Holt & Co. (TPH) wrote in a March 23 research note.

Last year, Baker Hughes began pivoting to customers preparing for the transition to a low-carbon future, bolstering its footprint beyond oil and gas oilfield services. As part of the strategic shift, the company began shedding some oilfield assets and putting more emphasis on new energy and technology needed for renewables.

The TPH analysts said they continue to believe Baker Hughes is the best through-cycle equity investment in the oilfield service sector (OFS), large-cap space and see enticing equity upside for the name.

“The company’s PSL portfolio is second-to-none in OFS land and they possess unique exposure to various end-markets (LNG, distributed power, turbomachinery / rotating equipment),” the analysts wrote later noting that Baker Hughes also possesses “an array of CCTS technologies in its repertoire and knows a thing or 50(+) about developing offshore projects.”

As part of its overall goals, Polaris aims to have the lowest carbon storage cost globally, paving the way for profitable CCTS facilities that are not reliant on government support schemes, according to the Baker Hughes release.

Additionally, the Polaris offshore carbon storage facility is part of Horisont Energi’s “Barents Blue” project, the first global and full-scale carbon neutral “blue” ammonia production plant.

“Baker Hughes has a broad and established portfolio of CCTS technology and proven expertise in executing some of the North Sea’s most complex offshore projects,” Uwem Ukpong, executive vice president of regions, alliances and enterprise sales at Baker Hughes, said in a statement on March 23. “We are proud to be partnering with Horisont Energi for new energy frontiers, taking the Polaris carbon storage project from concept to reality.”

Construction of the Polaris facility, which is still in the concept phase, is expected to begin in the second half of 2022. The facility is projected to have a total carbon storage capacity in excess of 100 million tons, which is equivalent to twice Norway’s annual greenhouse gas emissions, the Baker Hughes release said.

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