The decision comes after the Australian federal government – through Clean Energy Regulator – registered the project allowing it to qualify for carbon credit units for 25 years.
The A$220 million ($165m) project in South Australia also benefits from a A$15 million grant from the federal government under the Carbon Capture, Use and Storage (CCUS) development fund.
Moomba aims to permanently store 1.7 million tonnes of carbon dioxide per year starting from 2024.
At the proposed A$24 per tonne, Moomba is set to be one of the world’s lowest-cost CCS projects.
Santos chief executive Kevin Gallagher who is currently in Glasgow for the COP26 summit said the decision today was “a critical step in decarbonising natural gas on our path to new low-emissions and clean-burning fuels such as hydrogen”.
The company also plans to use its portion of the Bayu-Undan gas field off the coat of Darwin to store up to 10 million tonnes of carbon dioxide per year once gas production ceases.
First injection at Moomba is slated for 2024 with Santos retaining the option to expand annual capacity beyond 1.7 million tonnes.
Santos has a 66.7% stake in the Moomba project with the remaining 33.3% held by Beach Energy.
