Santos Ltd. has secured funding for the corporate’s share of the $220 million Moomba carbon seize and storage (CCS) challenge in South Australia.
The services secured by Santos quantity to $150 million and have a five-year tenor. The financing might be used to cowl Moomba challenge prices incurred thus far and might be tapped because the challenge progresses to the primary injection, focused for mid-2024.
Santos CEO and Managing Director Kevin Gallagher stated in a information launch Monday that banks are keen to fund vitality transition initiatives at “very aggressive” charges, indicating their recognition of CCS “as a significant software in reaching the world’s net-zero ambitions”.
“The robust assist Santos has obtained is underpinned by the progress we’re making on our Local weather Transition Motion Plan that’s centered on decreasing our personal emissions and people of our clients, in addition to on creating low-carbon fuels as buyer demand evolves”, Gallagher stated.
“The median of IPCC [Intergovernmental Panel on Climate Change] 1.5-degree situations assumes Asian gasoline demand will enhance barely out to 2050 (in comparison with 2020) with some situations assuming [a] demand enhance of 40 % or extra”, he continued. “Abating the emissions related to pure gasoline is essential to scale back greenhouse gasoline emissions and sort out local weather change, and our Moomba CCS challenge will assist obtain this. It’s encouraging that financiers are recognizing the essential position of CCS in abating emissions as we transition to internet zero”.
In response to Santos, the primary section of the Moomba CCS challenge is now 80 % full and is focusing on about $24 per metric ton lifecycle breakeven storage prices, which is able to make it one of many lowest-cost CCS initiatives globally and really aggressive with different carbon-abatement applied sciences and alternatives.
The challenge could have capability to retailer as much as 1.7 million metric tons of carbon dioxide per yr, which is equal to round 28 % of the entire emissions discount achieved in Australia’s electrical energy sector final yr, the corporate famous.
Earlier, Santos introduced its plans to broaden the Moomba CCS challenge and rework the Cooper Basin right into a decarbonization and low-carbon fuels hub. “The Cooper Basin will play a major position within the vitality evolution because it transforms right into a decarbonization hub with the potential to supply low-carbon fuels and supply CCS providers which may scale back emissions from essential fuels equivalent to LNG [liquefied natural gas] and from hard-to-abate sectors equivalent to metal, aluminium and cement”, the corporate stated.
Santos has lately signed a collection of agreements with worldwide third events to judge the potential to seize, transport and sequester their emissions at Moomba. The corporate in December 2023 signed a memorandum of understanding with Japanese corporations JX Nippon Oil & Fuel Exploration Corp. and ENEOS Corp. for a joint feasibility research evaluating the potential to seize, transport and sequester emissions from Japan, supporting the growth of the Moomba CCS challenge.
The memorandum seeks to collectively determine and outline industrial and funding alternatives masking the potential importation of as much as 5 million metric tons each year (MMtpa) of CO2 by 2030, 10 MMtpa by 2035 and 20 MMtpa by 2040 from Japan to the Moomba CCS challenge, by way of both Port Bonython in South Australia or Gladstone in Queensland.
The aggregation and administration of carbon at Moomba would additionally assist Santos’ Power Options low-carbon gasoline ambitions and complement present research with Tokyo Fuel and Osaka Fuel for potential low-carbon e-methane manufacturing within the Cooper Basin. This may facilitate the export of e-methane, made by combining inexperienced hydrogen with CO2 obtained from industrial emissions or direct air seize in a round economic system, Santos stated.
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