Australia 'lagging the world' on carbon capture policy

Australia must fix its policy settings to speed investment in carbon abatement technologies or risk ceding the advantage to international competitors, one of the country's largest gas producers says.

Carbon capture and storage (CCS) technology is widely dismissed as "greenwashing" by environmental groups, but Santos chief executive Kevin Gallagher says it will play an essential role in the world's energy transition, whether Australia takes part or not.

The technology captures CO2 emissions from industrial facilities, such as fossil fuel power stations, and injects it into the ground to prevent it ending up in the atmosphere.

Santos will open several major gas and oil projects in the coming years and sees CCS as essential to helping meet its carbon emissions goals.

Speaking at the company's annual meeting, Mr Gallagher said countries such as the United States, Indonesia and Malaysia were pushing ahead of Australia to make the most of the global demand for carbon abatement.

"The International Energy Agency has recognised Australia as having a competitive advantage in CCS, saying in 2023 that Australia is well suited to large scale deployment of CCS to facilitate domestic CO2 abatement and support regional emissions reductions," he told shareholders on Thursday.

"However, Australia is lagging the rest of the world in providing the policy and regulatory settings and the market signals that will facilitate greater financial investment in what could be a new, profitable, job-creating energy transition industry for our nation."

Mr Gallagher urged the federal government to put regulatory frameworks in place that would enable Australia to capture carbon from neighbouring countries, boosting the local economy and helping other nations decarbonise.

Bodies such as the Intergovernmental Panel on Climate Change and the Australian government accept CCS as having a role in the energy transition, but others are less convinced.

Santos is in the midst of a legal stoush with shareholder advocate the Australian Centre for Corporate Responsibility, which claims the CCS is an exercise in greenwashing.

Similarly, the Climate Council has called the technology a "licence to pollute", arguing it gives fossil fuel companies an excuse to ramp up emissions without having to invest in alternatives such as renewable energy and battery storage.

But Santos chair Keith Spence says the technology is proven, with more than 40 projects in operation around the world and a further 150 in construction or advanced development.

He says the company's Moomba CCS project in South Australia will store up to 1.7 million tonnes of CO2 a year, while its Bayu-Undan project off the coast of Timor Leste could store more than 10 million tonnes per annum.

Critics say Chevron's Gorgon CCS project in Western Australia, which has failed to meet injection targets and been beset by cost overruns, shows the technology cannot live up to the hype in the real world.

Unlike the greenfield Gorgon project, Moomba and Bayu-Undan benefited from having pre-existing infrastructure in place, resulting in lower capital expenditure costs, Mr Spence said.

License this article

What is AAPNews?

For the first time, Australian Associated Press is delivering news straight to the consumer.

No ads. No spin. News straight-up.

Not only do you get to enjoy high-quality news delivered straight to your desktop or device, you do so in the knowledge you are supporting media diversity in Australia.

AAP Is Australia’s only independent newswire service, free from political and commercial influence, producing fact-based public interest journalism across a range of topics including politics, courts, sport, finance and entertainment.

What is AAPNews?
The Morning Wire

Wake up to AAPNews’ morning news bulletin delivered straight to your inbox or mobile device, bringing you up to speed with all that has happened overnight at home and abroad, as well as setting you up what the day has in store.

AAPNews Morning Wire
AAPNews Breaking News
Breaking News

Be the first to know when major breaking news happens.

Notifications will be sent to your device whenever a big story breaks, ensuring you are never in the dark when the talking points happen.

Focused Content

Enjoy the best of AAP’s specialised Topics in Focus. AAP has reporters dedicated to bringing you hard news and feature content across a range of specialised topics including Environment, Agriculture, Future Economies, Arts and Refugee Issues.

AAPNews Focussed Content
Subscription Plans

Choose the plan that best fits your needs. AAPNews offers two basic subscriptions, all billed monthly.

Once you sign up, you will have seven days to test out the service before being billed.

AAPNews Full Access Plan
Full Access
  • Enjoy all that AAPNews has to offer
  • Access to breaking news notifications and bulletins
  • Includes access to all AAPNews’ specialised topics
Join Now
AAPNews Student Access Plan
Student Access
  • Gain access via a verified student email account
  • Enjoy all the benefits of the ‘Full Access’ plan at a reduced rate
  • Subscription renews each month
Join Now
AAPNews Annual Access Plan
Annual Access
  • All the benefits of the 'Full Access' subscription at a discounted rate
  • Subscription automatically renews after 12 months
Join Now

AAPNews also offers enterprise deals for businesses so you can provide an AAPNews account for your team, organisation or customers. Click here to contact AAP to sign-up your business today.

Download the app
Download AAPNews on the App StoreDownload AAPNews on the Google Play Store