The Australian government has unveiled an offshore acreage release for areas to explore for potential greenhouse gas storage opportunities.

The government confirmed the offshore bidding round had opened on Monday, covering five areas centred on prospective locations for GHG storage offshore the Northern Territory and Western Australia in the Bonaparte, Browse and Northern Carnarvon basins.

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Australia’s Minister for Resources Keith Pitt noted it was the first time since 2014 the government had released acreage for GHG storage, adding it would help provide a pathway for potential carbon capture and storage (CCS) projects.

“Australia has the capacity to continue to be an energy export leader, at the same time as providing a regional hub for the storage of greenhouse gas,” he said.

“Carbon capture, use and storage is one of the priority technologies we are developing. The proximity to gas fields and existing infrastructure provide opportunities for industry partnership and collaboration, further industrial development and the creation of jobs.”

Pitt added that the acreage releases announced on Monday had been based on industry nominations and had already been subject to public consultation earlier this year.

Work programme bids are to be submitted to Australian regulator the National Offshore Petroleum Titles Administrator between 4 March and 10 March next year.

Industry welcomes acreage release

The acreage release was welcomed by oil and gas industry body the Australian Petroleum Production & Exploration Association (APPEA), which claimed the release would help create jobs and help take “a significant step” towards reducing emissions via CCS.

“There’s no doubt that CCS is a solution to reducing emissions. It is safe, it is a permanent solution and we have already seen it can help achieve global climate goals,” said APPEA chief executive Andrew McConville.

“’Furthermore, Australia is in a great position to take advantage of CCS. We’ve got a head start and a natural competitive advantage to implement CCS with high quality, stable geological storage basins, infrastructure that’s already in place, the best technical expertise, and the right regulatory regimes.”

“With more experience, more gains in technology and larger areas of waters to work with, the cost of CCS will fall and that means we can deliver not just competitive, large-scale abatement for industries in operation now, but we can create new industries based on hydrogen and ammonia.”

McConville added that, combined with Australia’s natural gas industry, CCS has the potential to help deliver a large-scale blue hydrogen industry that could generate more jobs and export revenue for Australia.

Green vs Blue

Blue hydrogen is produced from natural gas feedstocks, with the carbon dioxide by-product from hydrogen production captured and stored. However, the process is not emissions free.

Green hydrogen is made using electrolysis powered by renewable energy to split water molecules into oxygen and hydrogen, creating an emissions-free fuel.

“Creating a new hydrogen industry helps cut emissions, lowers the cost of energy and creates new manufacturing opportunities,” he said.

“Many of our members are already at the cutting edge of CCS and hydrogen developments and this announcement can help developments move forward.”

Australia is home to one of the world’s largest CCS projects, Chevron’s Gorgon CO2 injection project, which is attached to its Gorgon liquefied natural gas development, however, that project has had teething issues and is still yet to operate at its

The Gorgon CCS facility is designed to capture and store 4 million tonnes per annum of CO2, however, a delayed start-up and continued issues have failed to see the project operate at capacity.

Just last month Chevron confirmed it would invest A$40 million (US$28 million) in Western Australian lower carbon projects, as well as acquire and surrender 5.23 million greenhouse gas offsets, as part of an offsets package to address the CO2 injection shortfall at Gorgon.

Australian independent Santos also recently sanctioned its onshore US$165 million Moomba CCS project in South Australia, while it is also exploring a potential offshore CCS development with Italy’s Eni in the Timor Sea, although that project would be in waters that lie in the jurisdiction for Timor Leste.