Aker Carbon Capture (ACC) just reported its Q1 2024 results. On the surface, it's a story of continued growth, an exciting new joint venture with SLB, and aggressive expansion into North America. But beneath the headlines, a subtle shift is occurring, one that could redefine ACC's core business and signal a significant change in the carbon capture landscape.

The joint venture with SLB, valued at a potential 5.9 billion NOK, dominates the narrative. ACC will own 20% of the combined entity, with SLB taking the majority stake. While this partnership unlocks global reach and accelerates technology development, it also raises questions about ACC's independent pursuit of its "Just Catch" modular capture unit strategy.

A closer look at the pipeline reveals a potential turning point. While ACC boasts an impressive 40 million tonnes of CO2 capture in its overall pipeline, a whopping 32.6 million tonnes are in the pre-FEED and Mobile Test Unit (MTU) stages, signifying early-stage inquiries rather than concrete projects. This surge in early-stage activity, particularly in power generation and waste-to-energy, coincides with a decrease in the more advanced “tenders, FEEDs, and PDPs” category, dropping to 6.5 million tonnes from 7.9 million the previous quarter.

Here's where the intrigue lies. ACC attributes this decrease to project timelines being pushed out. While delays are common in the CCUS sector, this shift, coupled with the SLB joint venture, suggests a potential strategic recalibration.

Is ACC Shifting Away from "Just Catch"?

Could it be that ACC is quietly pivoting away from its standalone “Just Catch” strategy, focusing instead on leveraging SLB’s capabilities to pursue larger, more complex projects?

Consider this: ACC’s Big Catch offering, designed for bespoke mega-scale facilities, is increasingly sought after for studies. These projects, while requiring a longer lead time, offer a higher long-term margin potential. The Uniper Grain power station project, with its potential to capture over 2 million tonnes of CO2 per year, exemplifies this shift. It marks a significant step towards transitioning ACC’s Big Catch offering from an EPC (Engineering, Procurement, and Construction) model to a license and key equipment model, a move indicative of targeting larger projects.

Furthermore, the SLB partnership equips ACC with the necessary resources and global reach to compete for these mega-scale projects, projects that might have been previously out of reach for a standalone ACC. The joint venture’s combined expertise, particularly SLB’s industrialization capabilities, creates a formidable force in the CCUS market.

The Numbers Tell a Story

The numbers support this hypothesis. ACC's backlog, though strong at 2.6 billion NOK, is heavily concentrated in 2024 (1.7 billion NOK) with a smaller portion (0.9 billion NOK) in 2025 and beyond. This suggests a potential gap in future revenue that larger, longer-lead time projects could fill.

ACC’s recent MOU with MAN Energy Solutions further strengthens this argument. Their collaboration, initially focused on the Brevik cement plant project, is now expanding into North America, targeting large-scale CO2 compression projects. This move aligns perfectly with the potential shift towards larger, bespoke facilities.

Backlog Distribution (Q4 2023) Reference: Aker Carbon Capture Q4 2023 Earnings Transcript [Link]

A New Era for Aker Carbon Capture?

It’s too early to definitively declare the end of ACC’s independent "Just Catch" era. However, the signs are compelling. The SLB partnership, the focus on large-scale projects, and the expansion into new geographies point towards a strategic evolution, one that prioritizes long-term growth and profitability over a rapid, solely modular-driven approach.

ACC's Q1 2024 results, therefore, represent more than just impressive growth. They offer a glimpse into a future where ACC, in collaboration with SLB, becomes a dominant force in the global CCUS market, pursuing projects that redefine the scale and scope of carbon capture. It's a quiet pivot with potentially seismic implications, one worth watching closely as the CCUS landscape continues to evolve.

Fun Fact: The Carbon Capture Potential of Forests

Forests play a vital role in capturing and storing carbon dioxide. A mature tree can absorb up to 48 pounds of CO2 per year! Protecting existing forests and planting new trees are crucial steps in combating climate change. Reference: USDA Blog