Energy groups Statoil and Shell plan the world's biggest scheme to bury industrial gases beneath the seabed in a billion project costing in excess of €1 billion.
The companies hope the scheme off the coast of Norway will raise oil output and curb global warming.
But Norway's Statoil and Anglo-Dutch Shell said the pioneering plan, due to start in 2010-12 and including construction of a gas-fired power plant in west Norway, would need "substantial government funding and involvement".
"This is a joint project for industry and the environment," Statoil chief executive Helge Lund told a news conference. "If we succeed, this technology can be used at other fields off Norway and internationally."
Under the scheme, Statoil would capture carbon dioxide from a gas-fired power plant to be built at Tjeldbergodden.
The carbon dioxide would then be piped to the Draugen and Heidrun oilfields off Norway and injected into the subsea reservoirs - raising pressure and helping force more oil to the surface.
Many other companies have been put off by high costs of similar carbon dioxide storage projects, which could help slow global warming. Mr Lund today declined to estimate how much government should pay.
Carbon dioxide, released by burning fossil fuels, is the gas most responsible for the global warming. Many other oil companies are also looking at ways to cut carbon emissions.
Schemes for injecting carbon dioxide are already operating in countries including Algeria and Norway. BP, for instance, hopes to build hydrogen-fired power plants whose carbon emissions would be stored in depleted oilfields.