Chevron Corp admitted Monday that what it had billed as the world’s largest Carbon Capture, Utilization and Storage (CCUS) project—a system it built to bury carbon produced in Australia’s Gorgon gas fields back into the ground—isn’t working half as well as it should.

The CCUS system, which Chevron installed at the Australian government’s behest, was supposed to sequester 80% of carbon emitted from the oil major’s gas extraction projects on the Western coast within the first five years. But, so far, the system has only caught 30% of emissions, falling short of its target by about 7 million tonnes.

Some climate campaigners dubbed the shortfall a “shocking failure,” but others were less surprised.

“This admission from Chevron highlights once again that carbon capture and storage in the fossil fuel sector is an expensive failure,” said Tom Baxter, senior researcher at Australian think tank, the Climate Council. After decades of research and billions of dollars of investment, “there is little to show for it.”

So why is CCUS still considered a tool in mitigating climate change?

Buzz around CCUS has hummed louder in recent years. Bloomberg says the term was uttered on investor calls with energy giants 160 times this year—three times more than in 2020. But carbon capture technology has been in operation for 50 years already.

The first CCUS project was set-up at a Texan gas field in 1972, where carbon emissions were caught and sold to oil fields, which use carbon injections to “enhance recovery” from oil wells. Injected carbon mixes with globules of oil left clinging to the parched chambers of mature oil wells and creates fluidity, so that oil rigs can suck up the dregs.

A peculiar feature of carbon capture and utilization is that the use-case produces more carbon emissions, since burning enhanced recovery oil releases carbon. Building the CCUS infrastructure and powering the CCUS operation is polluting, too. Overall, CCUS operations often produce more emissions than they reduce. Yet many governments and energy groups see value in CCUS technology.

The International Energy Agency (IEA) says CCUS is “essential to achieving the goal of net-zero emissions,” particularly in areas where carbon emissions are hard to eliminate, such as cement or aluminum production. The IEA says CCUS is integral to transitioning away from fossil fuels, too, although groups like the Center for International Environmental Law (CIEL) disagree.

In a report this month, CIEL argued that CCUS is “ineffective, uneconomic and unsafe” and that the hype around carbon capture tech risks diverting attention from more effective climate change solutions. But oil companies, with few other means of reducing emissions without reducing output, continue to invest in CCUS.

This month, China’s leading oil giant Sinopec broke ground on what it calls China’s largest CCUS project—capturing 11 million tonnes of carbon from one of Sinopec’s blue hydrogen production plants and using it to recover an additional 3 million tonnes of crude from one of the company’s oil fields.

The “utilization,” or monetization, aspect of CCUS is supposed to make carbon capture economically viable for companies like Sinopec that would find it impossible to reduce emissions and remain in operation otherwise. But, according to Bloomberg, dozens of CCUS projects have been cancelled since 2010 due to prohibitive costs.

Zhang Jianyu, chief representative at the Environmental Defense Fund in Beijing, says CCUS is “an indispensable tool” for China to achieve its carbon reduction goals, but admits that “limited demand [for sequestered carbon] coupled with high upfront capital costs significantly reduces the likelihood of CCUS commercialization.”

But instead of trying to make money from burying pollution, perhaps fossil fuel companies should accept it a cost of doing business—or switch to greener fields.

More below

Eamon Barrett
– eamon.barrett@fortune.com

CARBON COPY

Cataclysms

Floods and fires are devastating homes across the world. Last week, flood waters tore through towns in West Europe—particularly Germany, Belgium and the Netherlands—leaving at least 200 dead. This week, rainwater submerged parts of Central China’s Henan province, flooding a subway line in the provincial capital, Zhengzhou, and killing at least 29. Zhengzhou received 60% of its annual average rainfall on Tuesday. Meanwhile, wildfires are ravaging Siberia, where extreme heat has dried out swathes of forest, forcing villagers to volunteer as firefighters. Fortune

Cowboy, Bezos

Amazon founder Jeff Bezos went to, and then returned from, the edge of space Tuesday, becoming the second billionaire to do so in as many weeks. The rocket-fueled joy ride “reinforce[d] my commitment to climate change,” Bezos said—presumably meaning the opposite. According to Bezos, space travel could be the solution to our planet’s climate issues. "We need to take all heavy industry, all polluting industry, and move it into space,” Bezos said, estimating that could take “decades and decades” to achieve. BusinessInsider

Climate meeting

The G20 environment ministers are meeting in Naples, Italy, on Thursday. Speaking in London ahead of the meeting, U.S. climate envoy John Kerry told an audience that co-operation between China and the U.S.—the world’s current and historic largest polluters, respectively—was “the only way to break free from the world’s current mutual suicide pact.” Financial Times

Gabon goes green

The Lungs of Africa, a tract of rainforest in the Congo Basin, are the world’s most important forest ecosystem after the Amazon, and Gabon, the Central African country that is home to part of the forest, wants to utilize that resource for creating green bonds. Gabon is a natural sequester for carbon, as 85% of the country’s area is covered in forest. Now the country wants to use its forest conservationism as backing for green sovereign debt in order to diversify the economy away from oil sales, which fueled the nations’ growth. Financial Times

IN CASE YOU MISSED IT

Emissions set to rise to record levels as clean energy spending falls short, IEA warns by Katherine Dunn

Automakers blast Europe’s proposed ban on new combustion engine cars by 2035 by Christiaan Hetzner

Volkswagen EV sales badly trail Tesla in the prized China market, alarming analysts by Christiaan Hetzner

China just launched the world’s largest carbon trading market—and it already needs reforming by Eamon Barrett 

Philip Morris International is getting into inhalable medicine. Is it a PR stunt? by Darrin Duber-smith

CLOSING NUMBER

800

The number of times "carbon" was mentioned on investor calls during the first three quarters of the year, slightly more than the 790 times “growth” was uttered, Bloomberg reports. Other green buzzwords—methane, climate change, emissions, and renewables—have cropped up on investor calls more times this year than in any year going back to 2013.