Carbon solution imperative or Woodside's giant Browse gas reserves stay in the ground

Woodside Petroleum is getting back into the groove at its Browse gas development offshore its native Australia although the operator admits there is no certainty the project will leave the drawing board if the key challenge of managing the reservoirs’ carbon dioxide cannot be resolved.

Woodside’s main focus ahead of potentially moving into the front-end engineering and design phase en route towards project sanction is to find a technically and commercially viable carbon capture and storage solution to handle the Browse fields’ contaminants. The three gas fields that make up the Browse development contain between 8% and 12% carbon dioxide.

“We need a solution for Browse reservoir CO₂, so that’s part of the challenge to the team... that needs to be part of the base development plan,” Woodside chief executive Meg O’Neill told reporters at a briefing on the sidelines of APPEA 2022.

“The challenge for the Browse team is to ensure that we have a CCS design that will be reliable from day one,” she said, referencing the teething problems that Chevron has faced at its Gorgon CCS project on Western Australia’s Barrow Island.

Due to its large scale, the Browse project is expected to emit up to 7 million tonnes per annum of CO₂ at peak, averaging about 4 million tpa over 50 years, Upstream earlier reported.

The base case for Browse is that the CCS scheme will be offshore, with CO₂ volumes being reinjected into one of the Browse reservoirs, O’Neill confirmed.

She acknowledged that incorporating CCS into the Browse gas project would indeed increase the capital and operating expenditure.

“Our approach with Browse is that the CO₂ that comes out of the ground is CO₂ that wouldn't have been emitted if it wasn't for our activity. And so, we're treating that as a cost of doing business. So, the challenge we've put to the team is [the] CCS that handles the Browse reservoir gas needs to be part and parcel of the economics of the project.”

The Browse development is centred on a floating production, storage and offloading vessel. After some offshore processing and removal of the CO₂, gas produced at the trio of Browse fields would flow via pipeline infrastructure to the Karratha gas plant where it will be used as feedstock at the North West Shelf (NWS) liquefied natural gas project.

Other issues that need to be resolved before Woodside moves into the FEED phase for Browse include agreeing commercial terms between the project’s co-venturers and the NWS joint venture, and securing the necessary environmental approvals.

No firm timeline

O’Neill would not be drawn on when Woodside is targeting the final investment decision for Browse – Australia’s largest unexploited conventional gas resource.

“We have not set ourselves [and] we have not communicated to market, a timeline for Browse FID.

“We need to do the technical work on CCS. We need to get an agreement between the Browse partners and the North West Shelf partners on processing. We also have environmental approvals that we've been working on with the state and Commonwealth government for an extended period of time. We need to have that resolved before we even progress the project in to [the] FEED [stage],” she told Upstream.

“Those are the three conditions precedent to entering FEED.”

Project sanction would follow the front-end engineering and design work “assuming the right economics, but we need to take care of those foundational items first.”

O’Neill told the APPEA 2022 conference in Brisbane that she thinks Woodside has the right development concept for Browse, which will involve the exploitation of three gas fields – Brecknock, Calliance and Torosa – located around 425 kilometres offshore Broome, Western Australia.

Contingent resources at the fields are 13.9 trillion cubic feet of dry gas and approximately 390 million barrels of condensate.

“We are working on the technical elements of CCS to be able to sequester [the] CO2,” she told delegates.

She said the current energy crisis is a reminder of the value of LNG from Australia which has been delivering reliable cargoes to customers in Asia for more than 30 years “at prices they’ve been quite satisfied to pay”.

She added that the long-term prices in those LNG contracts were more affordable than the current spot market.

“So, I think the stars are aligning for Browse and we probably have a window here where the world is recognising that Australian LNG plays a role and hopefully we’ll be able to move the project forward.”