Dutch Regulator Says Shell & TotalEnergies Can Collaborate On CO2 Storage

Following an assessment of their plans, ACM has decided that as cooperation is necessary for getting the initiative off the ground and for realizing climate benefits, the “slight restriction of competition between Shell and TotalEnergies is not that harmful”. 

According to ACM, the two companies need to offer CO2 storage together and therefore jointly set the price with an eye to putting the first ±20% of the trunkline’s capacity into operation, while no collective agreements will be made for the remaining 80%.

The Dutch authority has come to the conclusion that collaborations between two competitors may negatively affect price, quality, and innovation, but that effect can be offset by certain benefits for the customers of those businesses and for the whole society.

Therefore, the parties asked ACM for informal guidance about whether their collaboration is compatible with the competition rules that offer an exemption to the prohibition to restrict competition if, in short, the benefits outweigh the costs.

ACM sees that a new market is created through this project and the launch phase where Shell and TotalEnergies collectively offer their storage facilities is followed by a large-scale and commercial phase where other companies that operate empty gas fields can also connect to the trunkline.

In the assessment, ACM examined whether the two companies would have been able to reach the same result individually and concluded that collaboration is necessary for making the project a success.

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