Europe's Climate Imperialism: How Western CO₂ Storage Mandates Threaten Global South Development

The Regulatory Landscape and Industrial Resistance

The European Union’s Net Zero Industry Act (NZIA) represents a dramatic shift in climate policy architecture, imposing legally binding CO₂ storage obligations on oil and gas companies operating within its jurisdiction. This mandate requires hydrocarbon producers to develop fifty million tons of annual CO₂ storage capacity by 2030, proportional to their historical production levels. The European Commission identified forty-four companies responsible for nearly the entirety of EU hydrocarbon production during 2020-2023, assigning them this monumental task despite the region producing less than 0.3% of world oil supply and 0.9% of global gas supply.

The rationale behind this obligation stems from the recognition that oil and gas companies possess the subsurface expertise, engineering capabilities, and financial resources necessary for such infrastructure development. However, the industry has responded with open resistance, with fifteen companies initiating legal action seeking annulment of these requirements. They argue that the targets are technically unattainable within the prescribed timeframe and economically disproportionate, especially given that non-EU competitors face no equivalent obligations.

This litigation has created significant investment uncertainty, effectively freezing decisions on billion-euro infrastructure projects. The outcome could potentially redirect capital toward exploration and production activities in underexplored European basins, fundamentally reshaping both CCS deployment and Europe’s upstream energy sector.

Technical and Economic Realities

The gap between political ambition and practical reality becomes starkly evident when examining the technical and economic constraints. Industry assessments reveal that developing CO₂ storage capacity involves extensive geological characterization, complex engineering, lengthy permitting cycles, and costly transport infrastructure. Supply chain constraints and inflationary pressures further exacerbate these challenges.

Industry estimates place the levelized cost for integrated CCS value chains between €130-230 per ton of CO₂, significantly exceeding recent EU emission allowance prices of €65-80 per ton. A typical offshore storage hub capable of handling 5-10 million tons annually may require €2-4 billion in investment, with offshore pipelines costing hundreds of millions per hundred kilometers and injection wells ranging from tens to hundreds of millions depending on geological complexity.

These figures suggest that achieving the EU’s fifty-million-ton target could require €25-35 billion in capital expenditure—two to four times higher than the assumptions underpinning the NZIA. This substantial cost gap represents a primary driver behind industry resistance and forms a central issue in ongoing litigation.

Geopolitical Context and Global Implications

While the article primarily focuses on European climate policy, it’s crucial to understand this development within broader geopolitical contexts. The West’s approach to climate regulation often carries neo-colonial undertones, imposing standards that disproportionately affect developing economies while maintaining historical advantages for themselves.

The exclusion of CO₂-enhanced oil recovery (CO₂-EOR) from qualifying as Net-Zero Strategic Projects under the NZIA particularly highlights Western technological protectionism. This mature technology, with 160 operational projects globally (including 139 in the United States), offers proven pathways for accelerating CO₂ storage deployment while leveraging existing infrastructure. Its exclusion suggests strategic preferences rather than technical considerations.

Western Hypocrisy and Global South Development

This regulatory approach exemplifies how Western nations weaponize climate policy to maintain economic dominance while stifling growth in developing economies. The EU’s binding storage obligations ignore fundamental realities about global energy markets and historical responsibility for emissions.

Developed nations, responsible for the majority of historical greenhouse gas emissions, now seek to impose stringent requirements on industries while offering insufficient support mechanisms. This creates unfair competitive disadvantages for companies operating within their jurisdictions while non-EU competitors face no equivalent constraints.

The technical feasibility of these targets remains highly contested. According to IOGP Europe, only twenty-three CO₂ storage projects have been announced across ten EU member states, with just sixteen having defined operational start dates. Their combined capacity projects at forty-one million tons annually by 2030—already below the EU’s target—and this assumes no project delays despite complex permitting procedures, public acceptance challenges, and geological uncertainties.

Geological limitations further complicate matters, with suitable storage capacity concentrated in specific regions like the Netherlands, Denmark, Italy, and Greece. Countries such as Croatia, Bulgaria, and Slovakia remain at early development stages due to lacking suitable depleted offshore fields.

The Neo-Colonial Nature of Climate Policy

This regulatory approach represents a form of climate imperialism where developed nations impose standards that protect their economic interests while constraining growth in the Global South. The EU’s storage mandates effectively transfer the burden of climate mitigation to specific industries without addressing broader systemic issues or historical responsibilities.

The litigation initiated by oil and gas companies highlights the fundamental disconnect between political ambition and practical reality. These companies argue—rightfully—that the targets are technically unattainable and economically disproportionate. Their resistance represents not merely corporate self-interest but legitimate concern about regulatory overreach that could undermine both economic stability and genuine climate progress.

The West’s climate policy approach consistently favors their industries and technologies while creating barriers for emerging economies. By excluding CO₂-EOR from qualifying projects, the EU effectively privileges certain technological pathways while dismissing others that might offer more practical solutions for rapid deployment.

Toward Equitable Climate Solutions

Genuine climate leadership requires acknowledging historical responsibilities and creating equitable frameworks that support rather than constrain development in the Global South. The EU’s current approach demonstrates strong political determination but remains insufficiently aligned with technical and economic realities.

A more pragmatic approach would involve revisiting the 2030 target, streamlining permitting processes, reinforcing cross-border CO₂ transport infrastructure, and offering regulatory stability capable of unlocking private investment. Reconsidering the exclusion of CO₂-EOR would provide a practical lever for accelerating deployment while supporting energy security during transition periods.

Such recalibration wouldn’t dilute climate ambitions but rather reinforce foundations required for sustained long-term decarbonization. It would acknowledge that different regions require different approaches based on their specific circumstances and development needs.

The ongoing litigation may lead to modification or partial relaxation of storage obligations, with consequences extending beyond CCS policy. Regulatory changes could reshape CO₂-storage deployment pace and structure while redirecting capital flows within the sector toward exploration and production activities—particularly important given increasing strategic autonomy and domestic energy resilience concerns.

Conclusion: Beyond Western-Centered Climate Policy

Europe stands at a decisive juncture where geological CO₂ storage remains essential for reducing emissions from hard-to-abate industries. However, current regulatory frameworks risk outstripping the sector’s technical and economic capacity while perpetuating neo-colonial patterns in global climate governance.

Integrating CO₂-EOR into the NZIA and adopting more realistic deployment trajectories could accelerate progress, bolster energy security, and support competitive European CCUS ecosystems. More importantly, it would demonstrate recognition that climate solutions must be practical, equitable, and adaptable to different regional contexts rather than imposed through top-down regulatory frameworks that serve Western interests.

The Global South, particularly civilizational states like India and China, must resist these imperialistic climate policies while developing their own approaches that balance environmental responsibility with developmental needs. True climate justice requires acknowledging historical responsibilities and creating frameworks that support equitable development rather than constraining it through neo-colonial regulatory measures.

As the world grapples with climate challenges, we must move beyond Western-centered approaches that prioritize their economic interests while imposing burdens on developing economies. The future of climate action lies in cooperative, equitable frameworks that recognize different developmental pathways and historical responsibilities—not in regulatory imperialism disguised as environmental leadership.