Woodside Petroleum to add carbon capture facility at start of $33.7bn Browse LNG project
Woodside says the break-even cost for carbon capture is ‘just north’ of $100 a tonne.
Woodside Petroleum plans to add a carbon capture facility to its $US20.5bn ($33.7bn) Browse LNG project in response to growing concerns over its emissions from the development.
While the West Australian gas project was delayed on Friday due to the oil price crash, Woodside said when it did resume it was likely to include a sequestration component from the start rather than 10 years into the project as originally forecast.
Two of Woodside’s Browse joint venture partners Shell and BP may hold concerns about the high carbon content of the project, according to the Conservation Council of WA.
“We’re looking at options now around sequestration not just in the immediate field area but other aquifers some distance from Browse,” Woodside chief executive Peter Coleman told investors. “You can see a world where that will be a licence to operate requirement for Browse.”
Woodside was among vocal critics of a plan by WA’s environmental regulator last year for companies to fully offset their emissions to help meet the state’s goal of net zero emissions by 2050.
Chevron is close to reaching full operations at its $2.5bn underground carbon capture and storage project at WA’s Gorgon project which aims to cut emissions by 40 per cent while Santos is pursuing a sequestration plan for its Cooper Basin fields in South Australia.
Still, Woodside faces a number of obstacles given its remote location including cost, according to consultancy Wood Mackenzie.
“Onshore in the Cooper Basin, which is near existing infrastructure, the process has been estimated at between US$25-$30 per tonne. Offshore is likely to be closer to triple that number, especially in remote areas such as the Browse basin,” WoodMac analyst Angus Rodger told The Australian.
“In fact, we believe there are no obvious CCS solutions at the moment for Browse. There are no fields nearby that stand out as viable candidates for sequestration. Bringing the CO2 onshore for sequestration would also be a very expensive option, as the long pipelines would need to be high-spec and corrosion resistant.”
Woodside said the breakeven cost for carbon capture is “just north” of $100 a tonne.
“It doesn’t affect the economics in a material way. I’d hate to say that to a regulator. But it’s very important and I think the project is robust enough to handle it,” Mr Coleman said.
WoodMac expects Browse will now be sanctioned in 2023 with first gas produced in 2028 or 2029.
