Santos says it can store 100 million tonnes of CO2 in Outback South Australia

Santos is claiming a world-first in “booking” a 100 million tonne carbon storage capacity in the Cooper Basin in South Australia’s Far North.

Santos says it can store 100 million tonnes of carbon dioxide in depleted oil and gas fields at Moomba in South Australia’s Far North, and is claiming a world first by “booking” the figure as part of its assets.

The Adelaide energy company said it had booked 100 million tonnes of CO2 storage potential at its $220m Moomba Carbon Capture and Storage (CCS) project, which the company signed off on developing in November last year.

Santos expects to initially store 1.7 million tonnes of CO2 in depleted gas fields at Moomba per year once the project is up and running.

Energy companies are required to regularly report their resources of oil and gas to enable investors to ascertain how they are performing and what their stores of oil and gas are.

Santos says it believes this is the first time a company has ever booked a CO2 storage resource in accordance with the CO2 Storage Resource Management System sponsored by the Society of Petroleum Engineers.

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“CCS is a critical technology to achieve the world’s emission reduction goals and we only have to look at current carbon prices to see how valuable 100 million tonnes of storage is,” Santos managing director Kevin Gallagher said.

“Santos sees CO2 storage capacity as a strategic competitive advantage in evolving cleaner energy, clean fuels and carbon markets.

Santos’s Kevin Gallagher at the Moomba gas plant. Picture: James Elsby,

“This globally significant carbon storage capacity booking is another tangible example of Santos leading the way in establishing the foundations to support the energy transition.”

Australian Carbon Credit Units, equivalent to one tonne of carbon dioxide stored or avoided by a project, are currently trading at $55.25, however overseas carbon prices are much higher, with European carbon credits changing hands for €96.45 ($154.87).

Santos’s Moomba project was declared eligible for ACCUs late last year, enabling the company to forge ahead with its development.

Santos has projected a full life cycle cost of $US24 ($33.65) to store CO2 at Moomba, and expects to inject the first CO2 in 2024, following successful pilot testing in late 2020.

Santos managing director Kevin Gallagher at the company’s Adelaide headquarters. Picture: Simon Cross

The company injected 100 tonnes of CO2 underground during that test, and has said Moomba CCS has the potential to store up to 20 million tonnes per year.

Santos is also looking at developing CCS hubs at other projects in its portfolio across Australia and Papua New Guinea.

Santos also reported its broader oil and gas reserves on Tuesday, with proved plus probable (2P) reserves increasing 80 per cent to 1.67 billion barrels of oil equivalent at the end of 2021.

This large increase was primarily due to the final investment decision on its $US3.6bn Barossa project off the Northern Territory coast and the merger with Oil Search.

Santos shares have increased from $6.42 to $7.60 since the merger went through on December 17, valuing the company at more than $25.6bn.

“Today’s statement is the result of Santos’ disciplined annual reserves process, which include external audit of approximately 94 per cent of total 2P reserves,” Mr Gallagher said.

The merger with Oil Search added 416 mmboe of 2P reserves while the final investment decision on Barossa added a further 373 mmboe.

Originally published as Santos says it can store 100 million tonnes of CO2 in Outback South Australia