Santos has signed four Memoranda of Understanding (MoU) for the proposed storage of carbon dioxide (CO2) emissions from third parties to underpin the initial development of the Bayu-Undan carbon capture and storage (CCS) project, where front end engineering design work is nearing completion.
The four non-binding MoUs for CO2 supply to Bayu-Undan CCS have been executed with potential upstream gas and LNG projects offshore the Northern Territory and in Darwin, and an energy and industrial conglomerate in Korea.
The MoUs indicate demand for CO2 storage at Bayu-Undan CCS could be more than 10 million tonnes per annum (Mtpa).
Bayu-Undan CCS ex-Darwin will be a relatively low-cost carbon solution, with costs expected to be well within the Australian Government’s proposed price cap on Australian Carbon Credit Units.
Bayu-Undan CCS has the potential to reduce the absolute emissions and emissions intensity of Australian gas and LNG projects, as well as of other industries in the Northern Territory, by providing safe and permanent CO2 storage in depleted gas reservoirs that previously held gas and condensate in place for tens of millions of years.
Importantly, Bayu-Undan CCS provides a potential Scope 3 emissions solution for Australia’s exports to Asia, with large customers in countries such as Korea looking to capture the energy and industrial emissions and ship CO2 to Australia for safe, permanent sequestration deep underground.
While the Bayu-Undan CCS project is located offshore Timor-Leste, Darwin is set to be an important regional hub for CO2 capture, transfer, and storage to Bayu-Undan as well as to other potential CCS locations offshore the Northern Territory, which are still in the exploration and feasibility stages.
