The Santos-led owners of the Bayu-Undan gas and condensate field offshore the Timor Sea have signed an agreement with the Timor-Leste petroleum regulator to progress carbon capture and storage at the field.

A memorandum of understanding signed by Santos and Timor-Leste's National Authority for Petroleum and Minerals (ANPM) details the areas the two sides, with the support of the Timor-Leste government, will work on collaboratively to test the viability of repurposing the existing Bayu-Undan offshore production facilities and using the Bayu-Undan reservoir for CCS.

“CCS at Bayu-Undan has 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," said Santos chief executive Kevin Gallagher.

Stay a step ahead with the Upstream News app
Read high quality news and insight on the oil and gas business and its energy transition on-the-go. The News app offers you more control over your Upstream reading experience than any other platform.

“This has the potential to be a win-win; good for the environment, good for industry and opening up an exciting opportunity for the people of Timor-Leste, so we look forward to progressing this MoU in partnership with the ANPM.”

Gallagher outlined recently that CCS at the Bayu-Undan field would contribute to decarbonizing Santos' Barossa gas project from project start up, "as well as opening up other resource opportunities and complementary industry opportunities in Northern Australia".

"We'll be looking to take around 2.3 million tonnes (per annum of CO2) from Barossa and Darwin every year."

Santos also has a partnership with Italian energy giant Eni working on CO2 capture and storage or utilization (CCUS) options in the Darwin area of northern Australia.

The Darwin LNG plant, which receives feedstock gas from Bayu-Undan, is located in Darwin.

Eni is the operator of the very large Evans Shoal gas field in the Timor Sea which has a high CO2 content.

Santos and Eni are also partners in Bayu-Undan, along with SK E&S, Inpex and Tokyo Gas.

The president of the ANPM, Florentino Soares Ferreira, said of the partnership with Santos: “This is a milestone for Timor-Leste. With the signing of the CCS MoU between Santos (representing its joint venture partners) and ANPM 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 UN net zero target by 2050."

Infill drilling: at the Bayu-Undan field offshore Timor-Leste Photo: SANTOS

“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.”