Lord Truscott, the UK energy minister, said he hoped the OSPAR convention on dumping waste at sea that now prevents the storage of CO2 under the North Sea would soon be changed.

"We're finding a positive response on the need to amend OSPAR to enable us to store CO2 emissions under the North Sea," Truscott told Reuters after a meeting with Norwegian Petroleum and Energy Minister Odd Roger Enoksen.

"We are hoping it may be amended at this month's meeting."

Norway and Britain have set up a task force to explore how to store CO2 in depleted oil and gas reservoirs or other geological formations under the seabed.

Officials said Netherlands may also join the task force which includes government officials and companies such as BP, Shell and Statoil.

EU members have drafted plans to build 12 CCS facilities by 2015. But the high costs of CCS projects mean they would likely breech EU caps on state aid at 40 percent of investment costs.

"CCS may initially need to be supported by (state aid) up to 100 percent, breaching EU rules," Truscott said, adding that ways to circumvent such regulations were being discussed.

"The fact is that if we don't give considerable support this will not happen and the EU knows that."

Truscott also said that Britain was in preliminary talks to see if EU funds can be directed to CCS projects. Norway is not an EU member but is part of the bloc's economic area.

WHOSE RESPONSIBILITY?

Enoksen said long-term liability issues were another major hurdle blocking undersea CCS, as there are no rules on what companies or countries should be responsible for maintaining the storage facilities and ensuring no leakage.

Norway has 10 years of experience of injecting CO2 into the Sleipner field in the North Sea and has given public aid to create technology needed to lower CCS costs.

"The main task is to increase work on cost reduction needed for CCS to succeed," Enoksen told reporters. "Right now, it's still impossible to say when CCS will be commercially viable."

Enoksen said the costs of CCS needed to be reduced by roughly three-quarters for the process to become viable without state aid, depending on the price of carbon emissions.

But once CCS technology was in place and more affordable it could be exported to other EU states and later to developing countries where emissions of heat-trapping gasses are rising fast.