Australia’s Santos (ASX:STO) and US giant Chevron (NYSE:CVX) have committed to spending around A$200 million (US$136 million) to assess the geological potential for carbon capture and storage (CCS) projects offshore Australia after winning two greenhouse gas (GHG) acreage permits.
Santos, as operator, has committed to drill three wells over the six-year term of its two permits for a combined, total work campaign costing around A$200 million.
The Australian government hopes its first GHG storage acreage release since 2014 will help provide a pathway for potential CCS projects to help decarbonise industry and the energy sector. The offshore bidding round, which closed in March, covered five areas for prospective GHG storage offshore the Northern Territory and Western Australia in the Bonaparte, Browse and Northern Carnarvon basins.
Santos will share permit G-9-AP in the Bonaparte basin with Chevron. It will drill two exploration wells over its six-year term and carry out various studies for a total investment of A$126.6 million.
Santos will share its other permit, G-11-AP in the North Carnarvon basin, with Chevron and PRISM Darwin Pipeline. One exploration well is planned in the later part of its six-year term. Total investment for this permit is expected to be A$73.6 million covering a seismic shoot, analysis, and drilling.
As previously reported, Japan’s Inpex and partner TotalEnergies also won a GHG permit, G-7-AP, offshore Australia that could help a plan to bury emissions from liquefied natural gas (LNG) export projects in northern Australia. Woodside is also a partner in that permit. The consortium has pledged to spend A$165 million over the next six years.
As reported yesterday, Woodside won the G-8-AP permit in the Browse basin offshore Western Australia and leads a joint venture, comprising Shell, BP, Chevron, Mitsui, and Mitsubishi, at the G-10-AP permit in the northern Carnarvon basin offshore Western Australia, as they pursue a potential CCS project. The joint venture has committed to spend A$19.8 million at the Carnarvon permit, while Woodside will invest A$14 million at its Browse permit.