Costain’s NEP carbon capture work lifts energy revenue 25.7%
Costain’s half-year results show the Teesside carbon capture cluster is moving from contract awards to revenue, with £21.7bn of state support behind it.
Costain reported a 3.4% rise in half-year revenue to £543.1m on Thursday (2026-08-13), with its energy division growing at a far faster clip. Energy revenue jumped 25.7% to £37.2m, a gain the contractor attributed directly to its work on the Northern Endurance Partnership carbon capture project in Teesside.2
The numbers matter because they show the UK’s flagship carbon capture programme is finally translating procurement wins into booked income. Northern Endurance Partnership, the CO2 transport and storage developer backed by BP and its partners, has been handing out contracts across the Teesside cluster for over a year, and Costain’s mid-year results are among the first clear evidence that the money is flowing through to the supply chain.2
The scale of the prize is substantial. The project was successful in the track 1 government scheme as part of the East Coast Cluster, making it eligible for £21.7bn of government support alongside the HyNet project in the North West. That figure, confirmed by the North Sea Transition Authority, underscores how much public money is riding on the cluster’s delivery.1
Costain says it is working on further expansion into the sector, though the company has not detailed which additional contracts it is pursuing. The Teesside work is the anchor, but the firm is clearly positioning itself for a broader role in the UK’s carbon capture build-out.2
The pipeline is not yet exhausted. On Friday (2026-05-29), the North Sea Transition Authority published a new tender through its Energy Pathfinder portal seeking two guard vessels to support offshore infrastructure for the Northern Endurance Partnership. The tender is worth up to £25m and would require the vessels to be in service for 73 days each, including mobilisation and demobilisation phases.1
Guard vessels are a routine but necessary part of offshore operations, protecting subsea infrastructure during installation and maintenance. Their procurement suggests the offshore elements of the NEP are advancing on schedule, even as the broader debate over carbon capture’s viability continues.1
That debate shows no signs of settling. Carbon capture is still discussed as if technical performance were the decisive question, whether solvents can strip CO2 from flue gas, whether the gas can be compressed and injected, whether storage will hold. Those questions matter, but they no longer explain why most projects are being delayed or cancelled.3
The real constraint is economic. Projects need a revenue model that works, and in the UK that means the government support announced through the track 1 process. The £21.7bn committed to the East Coast Cluster and HyNet is the mechanism that makes the numbers add up, and it is also the exposure that would come under pressure if costs overrun or delivery slips.1
Costain’s results do not answer that question. A single contractor’s energy revenue line is a lagging indicator, and 25.7% growth from a £37.2m base is a modest absolute contribution against a group that did £543.1m in the half. The contract work is real, but it is still early days for the cluster.2
What will matter more is whether the government’s support package, and the project’s economics, hold up as construction moves to the expensive offshore phase. The guard vessel tender is a small piece of that, but it is a signal that the operator is spending.1
The next catalyst to watch is the pace of additional contract awards across the East Coast Cluster. Costain has flagged further expansion ambitions, and the NSTA tender pipeline suggests more work is coming. But with carbon capture economics still contested, the revenue growth that this half delivered needs to be repeated before the market can treat it as a structural trend rather than a one-off boost.2,1
For now, the contractors are getting paid and the project is moving. Whether the £21.7bn of state support buys a working cluster, or just a well-compensated supply chain, is the unresolved question.1