Photo: Santos

Santos and Timor-Leste to work on CCS at Bayu-Undan field

Australian energy giant Santos has signed a Memorandum of Understanding (MOU) with the Timor-Leste regulator Autoridade Nacional do Petróleo e Minerais (ANPM) to progress carbon capture and storage (CCS) at Bayu-Undan gas and condensate field located in the Timor Sea.

Santos is the operator of the Bayu-Undan Joint Venture with SK E&S, Inpex, Eni, and Tokyo Timor Sea Resources as partners.

The MOU details the areas the Bayu-Undan JV and the ANPM, with the support of the Timor-Leste Government, will work on collaboratively to test the viability of repurposing the existing Bayu-Undan facilities and using the Bayu-Undan reservoir for CCS, Santos said on Tuesday.

Santos also explained that these include sharing technical, operational and commercial information, assessing the regulatory framework, evaluating local capacity opportunities, and establishing a decision timeline.

Santos Managing Director and Chief Executive Officer, Kevin Gallagher, believes the Bayu-Undan reservoir and facilities have the potential to be a world-leading CCS project.

Gallagher said: “CCS is recognised by the International Energy Agency and the Intergovernmental Panel on Climate Change as being a critical technology to achieve the world’s climate goals. Santos’ experience with the globally-competitive Moomba CCS project in outback South Australia will bring invaluable experience to the project.

“CCS at Bayu-Undan has the potential capacity to safely and permanently store approximately 10 million tonnes per annum of CO2 and could build a new job-creating and revenue-generating industry for Timor-Leste”.

ANPM President, Florentino Soares Ferreira, said that the signing of the CCS MOU with Santos proves that Timor-Leste is proactively taking the lead in integrating its oil and gas sector towards Timor-Leste’s commitment of accelerating decarbonization and meeting the U.N. net-zero target by 2050.

Ferreira added: “Despite Timor-Leste being one of the lowest emission countries in the world, and that the Paris Agreement provides waiver or concession to the developing and less developed nations such as Timor-Leste; we understand that carbon trading or carbon credits market is an integral part of our future economy.

“We don’t want to miss this opportunity, and I believe this will become one of the largest CCS projects in the Southern Hemisphere. This will enable both Timor-Leste and Australia to exploit its untapped resources in meeting energy demands as well as offsetting its carbon emissions and transitioning towards carbon-neutral economies”.

Earlier this year, Santos started production from the Phase 3C infill drilling program at the Bayu-Undan field, reporting a better than anticipated outcome from the first well.

The first well was brought online at 178 million standard cubic feet per day (mmscfd) of gas and 11,350 barrels per day (bbl/d) of liquids, significantly increasing liquids production to over 25,000 bbl/d from the field and increasing offshore well capacity for the supply of gas to the Darwin LNG plant.

Following the first well, the Noble Tom Prosser rig in July proceeded to drill the second of the three wells, with the program expected to be completed early next year to maximise value from the field.