Santos Australian Barossa gas project attacked over high CO2 emissions

Quantum Commodity Intelligence – Australian oil and gas producer Santos Limited is facing strong criticism over its plans to develop a new gas field in the Timor Sea, according to Australian media reports.

Iron ore magnate Andrew Forrest lead the attacks on Santos in an interview;

"Santos is about to kick off one of the most polluting projects in the world," Forrest told Nine newspapers.

"It needs to be called for what it is. It is an atrocious project, an atrocious project."

Santos bought the Barossa project from US gas giant ConocoPhillips in May 2020 for A$4.7 billion. Prior to the sale, ConocoPhillips filed its project proposal to the federal regulator, which predicted the gas field would produce 1.5 tonnes of CO2 equivalent for every tonne of LNG.

Santos declined to respond to ABC Rural's questions about its own calculations of Barossa's carbon emissions. 

But chief executive Kevin Gallagher told a news conference last week the company's plans for Barossa would reduce its estimated carbon emissions 25 per cent on ConocoPhillips' estimates.

Emissions

Taking into account that reduction, the project would still produce around 1.1 tonnes of CO2 equivalent for every tonne of LNG, according to John Robert, a chemical engineer and industrial economist.

"It's a carbon-dioxide emissions factory, with an LNG by-product," Robert said.

Barossa is on track to be the most carbon-intensive gas project in Australia, according to an analysis conducted by Robert for the Institute for Energy Economics and Financial Analysis.

"[Barossa's carbon emissions] would be about twice the current Australian LNG industry average," he said.

"But, if a 25 per cent reduction in emissions could be achieved, Barossa would still be about 60 per cent higher than the average today."

Capture

Gallagher told media that Santos's 25% reduction in Barossa's emissions from ConocoPhillips' estimates had come about through "design changes" made by the company. 

Last December, Santos made a pledge to achieve net-zero carbon emissions by 2040.

To reach that target, the company is betting heavily on carbon capture and storage (CCS), an emerging technology backed by the federal government that some argue is still unproven.

Santos has already committed A$210 million to its Moomba CCS project in outback north-east South Australia, which it hopes will be able to store 1.7 million tonnes of CO2 per year.

For Barossa, Mr Gallagher said Santos was looking at the potential of storing its carbon under the seabed in the Bayu Undan gas field — also in the Timor Sea — when it reached its end of life, but the company is far from making a final investment decision on a CCS scheme for Barossa.

"We have designed all our facilities on Barossa so that, although the plan would be to vent some carbon offshore … we have designed it so we can bring it [carbon] all onshore," he said.

"So, if we do get a CCS outcome where we want to capture all that CO2 and not release any into the atmosphere, we can bring it all to [Darwin LNG], then compress and dehydrate it and send it along the pipeline to Bayu Undan."

Santos is aiming to start producing gas from Barossa in the first half of 2025.