OSG Receives $3M Grant from US DOE to Engineer Vessel for LCO2 Transportation

Overseas Shipholding Group, Inc. (NYSE: OSG), a prominent provider of energy transportation solutions, has disclosed the receipt of a $3,000,000 grant from the United States Department of Energy. The grant is earmarked for the engineering and design of a novel vessel designated for the transportation of liquefied carbon dioxide (LCO2). Specifically, the awarded funds will support the development of the design for an articulated tug and barge unit (ATB). This vessel is intended to facilitate the transportation of CO2 captured by emitters in the Greater Tampa Bay area and throughout Florida to sequestration sites located in the Gulf of Mexico.

The newly acquired vessel grant represents another stride toward establishing a comprehensive CO2 storage and transportation framework for industrial emitters in Florida. This grant follows OSG's announcement in December 2023 regarding the receipt of another grant from the Department of Energy for the development of the proposed Tampa Regional Intermodal Carbon Hub (T-RICH). The T-RICH grant finances a study, led by OSG, aimed at establishing an intermediate storage hub at Port Tampa Bay for captured CO2. Initially, T-RICH is slated to receive, store, and process two million metric tons of CO2 annually, with potential scalability in the future to accommodate increased volumes of captured CO2. The ATB, which is the focal point of the current grant, would serve as a marine transport solution for captured CO2 aggregated at the T-RICH hub terminal in Tampa, facilitating its shipment in liquefied form to established and approved sequestration sites in the northern Gulf of Mexico region.

"The Department of Energy has actively advocated for the advancement of carbon capture and storage (CCS) systems as part of the United States' commitment to reducing CO2 emissions and achieving net-zero carbon status by 2050," stated Sam Norton, President, and CEO of OSG. "It is projected that CCS systems will contribute up to 30% of the overall carbon emission reduction target. Leveraging our extensive experience as a prominent energy transportation provider, OSG has continuously embraced new technologies and pioneered innovative solutions to address our nation's energy requirements," Mr. Norton elaborated. "Venturing into the transportation of liquefied CO2 represents a natural progression into a dynamic emerging market, aligning seamlessly with OSG's proficiency in handling liquid cargoes."

Jeff Williams, OSG’s Director of CO2 Transport Solutions, remarked, "The establishment of a CO2 transport ATB, coupled with the previously granted hub storage terminal at Port Tampa Bay, offers a holistic solution for Florida's major emitting industrial facilities to contribute to the nation's efforts in addressing the impacts of climate change, which particularly affect Florida's residents and delicate ecosystems. OSG's initiative will expedite the implementation of carbon emission reduction strategies in Florida, leading to enhanced well-being in impacted communities, the generation of numerous job opportunities, and the introduction of innovative and transformative technologies to the state."

"The state of Florida offers a distinctive chance for liquefied CO2 transportation. Despite ranking fourth in the nation for CO2 emissions from power generation and industrial facilities, Florida lacks a pipeline infrastructure capable of exporting captured CO2 beyond state borders," Williams continued. "OSG's proposed T-RICH hub location at Port Tampa Bay aims to consolidate and store captured CO2 for loading onto OSG-operated LCO2 ATBs. Subsequently, these cargoes would be transported to the northern Gulf of Mexico, known for its extensive capacity for secure, deep, and permanent underground sequestration of captured CO2."