Santos has revealed that the company and its Bayu-Undan joint venture partners have signed a Memorandum of Understanding (MoU) with Timor-Leste’s national oil company Timor Gap to explore partnership opportunities for the proposed Bayu-Undan CCS project in offshore Timor-Leste in Southeast Asia.
The announcement comes after four non-binding MoUs were signed for CO2 supply to Bayu-Undan CCS. This highlights a demand for CO2 storage at Bayu-Undan CCS, which could be more than 10 million tons each year. The most recent MoU, however, will see the parties sharing information about Bayu-Undan CCS, while also investigating partnership opportunities such as equity participation for Timor Gap in the Bayu-Undan CCS project.
“This could be an exciting new industry for Timor-Leste, putting it at the leading edge of the global energy evolution and generating revenue, local jobs and business opportunities for the nation,” said Kevin Gallagher, managing director and chief executive officer, Santos. “Santos and our joint venture partners are delighted to be working with Timor Gap on partnership opportunities to advance Bayu-Undan CCS as a carbon storage hub for customers in Australia, Japan, Korea and across Asia as those countries seek to decarbonize their economies.
“This MoU is yet another agreement highlighting the strong interest in carbon capture and storage, and its broad acceptance as a safe, proven technology that is absolutely critical to achieving the world’s climate goals.”
Gallagher added, “We look forward to working with Timor Gap and the Timor-Leste and Australian governments to progress the necessary commercial, fiscal and legislative arrangements to support the development of the Bayu-Undan CCS project.”
The latest project is stated to be a “cost-competitive carbon solution” because of its large scale and the ability to make use of existing pipelines and infrastructure.
The CCS project is viewed as having the potential to reduce all of the emissions and emissions intensity of Australian and Timor-Leste gas and LNG projects, as well as other hard to abate industries in the area.
The Bayu-Undan CCS project forms part of Santos’ three-hub CCS strategy, and includes the Moomba CCS project which the company states is now 70% complete. Once finished in 2024, the site will have the capacity to store 1.7 million tons of CO2 annually.