Santos Signs Carbon-Capture Customers for Planned Offshore Project — OPIS

Santos Ltd. has signed four memoranda of understanding for the storage of carbon dioxide emissions from third parties at an offshore gas condensate field being developed as a repository for the greenhouse gas, the Australian energy company said Wednesday.

The Bayu-Undan carbon capture and storage project is about 300 miles offshore Darwin, Australia, in the Timor Sea. Santos estimates the site could store more than 10 million metric tons of CO2 per year.

The non-binding MOUs were signed with potential upstream natural gas and LNG projects offshore the Northern Territory and in Darwin as well as with an energy and industrial conglomerate in South Korea, the company said in a news release.

It said Bayu-Undan has the potential to reduce the absolute emissions and emissions intensity of Australian gas and LNG projects by providing safe and permanent CO2 storage.

"Importantly, Bayu-Undan CCS provides a potential Scope 3 [supply chain] emissions solution for Australia's exports to Asia, with large customers in countries such as [South] Korea looking to capture energy and industrial emissions and ship CO2 to Australia for safe, permanent sequestration deep underground," Santos said in the release.

Santos Managing Director and Chief Executive Kevin Gallagher said the MOUs reflect strong demand for CO2 storage in the region.

"Increased deployment of CCS is critical to achieve the world's climate goals and executing these MOUs demonstrates the strong underlying demand for CCS and the broad acceptance of CCS as a decarbonization strategy," Gallagher said.

While front end engineering design work is nearing completion at Bayu-Undan, a final investment decision is targeted for 2025, Santos said.

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--Reporting by Abdul Latheef, alatheef@opisnet.com; Editing by Jeff Barber, jbarber@opisnet.com

(END) Dow Jones Newswires

May 03, 2023 11:07 ET (15:07 GMT)

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