Australian independent gas producer Santos has signed a preliminary, non-binding agreement with BP to fund a 1.7 Mt/year carbon capture and storage (CCS) project in South Australia. Once the agreement is finalised - the final investment decision (FID) is expected by the end of 2020 - BP could invest AUD20m (US$13.2m) in the Moomba CCS project. Santos is currently conducting front-end engineering design (FEED) for the proposed CCS project. It aims at capturing the 1.7 Mt/year of CO2 currently separated from gas and to reinject it into a former gas reservoir. The project could be expanded at a later stage to a capacity of 20 Mt/year.
As BP ceased its program of exploration in the Great Australian Bight in 2017, the company had to re-direct exploration investment within the country, as required by Australia’s Good Standing Agreement policy. BP was expected to invest AUD40.5m (US$26.8m) by 2022. BP’s investment in Moomba CCS project would be made as part of BP’s Good Standing Agreement with the Joint Authority, in charge of granting exploration permits. In December 2019, BP and Chevron committed to investing AUD116.5m (US$77m) in oil and gas exploration activities, with at least half direct to initiatives in South Australia.