Australia’s second largest independent gas producer, Santos, said Wednesday BP wants to join its carbon capture and storage (CCS) project in South Australia, Kallanish Energy reports.
The British oil major signed a non-binding agreement to invest A$20 million ($13.2 million) into the Moomba CCS project. The deal is subject to some conditions and a final investment decision, which is expected at the end of 2020.
The project is planned to sequester 1.7 million tonnes per annum (Mtpa) of CO2 emissions from the Moomba gas processing plant’s operations. The captured CO2 would then be reinjected into a geological formations of the Cooper Basin.
Santos’ CEO Kevin Gallagher estimated the cost of this abatement to be at less than A$30 ($19.8) per tonne, with views to reduce these figures with scale and experience.
“Australia needs low-cost, large-scale abatement to maintain our position as a leading energy exporter and manufacturer of energy-intensive materials such as steel and cement, as well as to enable new industries such as hydrogen,” said Gallagher.
With the Cooper Basin’s reinjection capacity estimated at up to 20 Mtpa for 50 years, the CCS project has the potential “to be a large-scale sink for power generators and other industries in eastern and southern Australia,” he added.
BP said CCS has an important role to play in meeting the objectives of the Paris Agreement, achieving “deep emissions reductions” in operations of existing fossil fuels users. The supermajor is involved in CCS research, development and projects around the world, including the Net Zero Teeside project in the UK – set to be the world’s first large-scale commercial facility for capturing and storing carbon emissions from gas-fired power generation.
The FID for Moomba will depend on the Australian government’s policy support. For now, Gallagher said he’s very pleased to see the government recognizing the importance of CCS and moving forward with a Technology Investment Roadmap to support it.
This post appeared first on Kallanish Energy News.