Carbon capture and storage (CCS) is firming up as a key technology to achieve energy security while significantly reducing Australia’s carbon footprint.

The resources sector has played a crucial role in world-first projects in Australia that have demonstrated there are no technical barriers to implementing CCS.

The technology involves capturing carbon dioxide emissions from burning coal, power stations or industrial facilities such as steel, LNG or cement plants and safely storing it deep underground in geological formations.

Now the race is on to improve the commercial viability of the game-changing technology so more large-scale projects can be rolled out across fossil fuel- heavy industries.

Expert agencies including the Intergovernmental Panel on Climate Change (IPCC) have found large scale deployment of CCS will be vital to Australia meeting its goals under the Paris agreement.

CCS is seen as an enabler for other key industries including natural gas processing, biomass and biofuels, enhanced oil recovery and waste to energy projects.


Crucially, the technology sets the stage for Australia to become a clean hydrogen powerhouse to take advantage of growing global demand.

The captured CO2 can be used to create a plethora of other valuable products unrelated to energy supply including pharmaceuticals, building materials, fertilisers, chemicals and even bushfire suppressants—to name a few.

Chevron is already operating the world’s largest CCS project at Gorgon LNG in WA which is expected to store more than 100mt of CO2 over the project life.

But there are several other exciting flagship projects happening across the country which The Australian Mining Review has highlighted in this special feature.


CarbonNet is working towards establishing a commercial scale CCS network in Victoria’s Gippsland region.

The network would bring together carbon dioxide capture projects in the Latrobe Valley, transport the CO2 via a shared pipeline and inject it 1.5km below the seabed into geological storage sites in the Bass Strait.

Regulatory applications are being prepared for the first storage site, Pelican, which has the capacity to sequester 125mt of CO2 over 25 years.

The 5mt to be stored annually is more than the 3.3mt-4mt captured each year at Gorgon and is equivalent to taking about one million cars off the road every year it operates.

CarbonNet director Ian Filby said the project has enormous potential to underpin the creation of new industries and employment opportunities in the Latrobe Valley consistent with the Victorian Government’s commitment to Net Zero Emissions by 2050.

“There is increasing interest from the private sector as part of CarbonNet’s commercialisation journey following the release of the Victorian Government’s Request for Industry Submissions in late 2019,” he said.

“Subject to relevant approvals and investment, the project could be ready to proceed to construction and operation in the mid-2020s.

“The next opportunity for the Gippsland is to be a CCS hub enabling new industries and in particular hydrogen.

“You can build CarbonNet for under $1b but it unlocks many multiples of that in terms of new industry investment and development; we’d say it’s probably a 10-1 multiplier.”

Clean hydrogen can be produced using electricity from renewables or from fossil fuels using CCS.

“CarbonNet provides a commercially viable and cost-effective CCS solution for the commercial phase of the world-leading Hydrogen Energy Supply Chain (HESC) project, located in the Latrobe Valley and on the doorstep of the Pelican site,” Mr Filby said.

The world-first project will produce clean hydrogen from coal using CCS and will be the first initiative to transport mass quantities of hydrogen across open waters, from Australia to Japan.

HESC is being developed in two phases beginning with the current pilot phase.

If successful, the project will proceed to a commercial phase, which is set to attract billions of dollars of international investment and position Australia as a global leader in the supply of clean hydrogen energy.

The decision to proceed to a commercial phase will be made in the 2020s with operations targeted in the 2030s, depending on the successful completion of the pilot, technical readiness, financial viability, regulatory approvals, social licence to operate and hydrogen demand.

CarbonNet is funded by the Victorian and Commonwealth Governments.

The sun sets over Bass Straight and the Noble Tom Prosser drilling rig above CarbonNet’s Pelican site off the Gippsland coast.

Glencore’s CTSCo project

Glencore’s Carbon Transport and Storage Company (CTSCo) is conducting a demonstration project on behalf of the coal industry to assess the technical feasibility and safe operation of a CCS project in the Surat Basin.

The project aims to capture and store emissions from the Millmerran Power Station with work being undertaken over the next few months to verify the capacity of the preferred storage site.

Work will include the drilling of two appraisal wells, a seismic survey and a range of research and development projects in the area.

Mark McCallum is the CEO of Low Emission Technology (LET) Australia, formerly Coal 21, which represents a coalition of black coal producers who have committed a $550m war chest to invest in technologies that reduce carbon emissions.

“Once we have proved up the site we hope to be in a position to support the Glencore CTSCo project and hope to capture CO2 off the Millmerran Power Station site,” he said.

The capture of CO2 from a power station had only been achieved twice before on a global level, at Boundary Dam in Canada and Petra Nova in Texas, he said.

Mr McCallum said they were aiming for financial sanctioning of the project by the end of the year, with the capture and storage into the Surat Basin due to happen within two or three years.

While the project will capture between 100,000 and 110,000t of CO2 year from Millmerran, the intent is to attract other project partners and create new clean industries.

‘’In the vicinity of the storage location you have roughly 20mt of existing emissions from gas and coal fired power stations within 100km,’’ Mr McCallum said.

“With this storage comes the opportunity of new industries such as hydrogen which could provide a clean fuel for electricity, steel production and even motor vehicles.

“We are looking to send a very strong signal that we are serious about practical action to reduce emissions.”

Otway National Research Facility

CO2CRC’s world-renowned Otway National Research Facility in Victoria achieved Australia’s first demonstration of the geological storage of CO2 back in 2008.

Chevron was a founding member of CO2CRC and the outcomes of the organisation’s projects are shared with all members which include BHP, Chevron, Shell, Total, ExxonMobil, Woodside, JPower and Santos.

CO2CRC have just completed upgrading Otway in preparation for the next large-scale demonstration project, Otway Stage 3, which will involve the injection of another 15,000t of high CO2 content gas by the end of this year.

Stage 3, which will run until 2022, will test the next generation of CO2 subsurface monitoring technologies with the aim of significantly reducing operational costs.

The anticipated benefit is to save up to 75% on long-term monitoring costs, which account for between 40-60% of the price tag of the storing carbon dioxide in geological structures.

CO2CRC chief executive David Byers said the organisation’s research had proven there are no technical barriers to implementing CCS in Australia and that costs of application are improving.

“Carbon Capture Utilisation and Storage will be an essential element in the portfolio of solutions needed to take on the dual challenge of supplying energy while addressing the risks of climate change,” he said.

“CCS is the only feasible technology that can deliver deep emissions reductions in many high-value industrial sectors that are vital to the global economy such as LNG, steel, cement and chemicals production.

“CCS can be cost-effectively applied to coal and gas fired power plants, providing dispatchable low emissions generation capacity to provide grid stability and security of supply to complement an increased deployment of intermittent renewables.

“The production of hydrogen with a low-carbon footprint, produced using fossil fuels with CCS or renewable energy, has the potential to significantly reduce energy-related CO2 emissions domestically and position Australia to benefit from the growing demand for hydrogen globally.”

Australia has a number of global competitive advantages in CCS: vast fossil fuel resources, internationally recognised resources industry know-how, expertise and capability, access to the latest technologies and some of the best CO2 storage basins in the world.

CCS can also improve Australia’s energy security and help meet emissions reduction targets through improved oil recovery (CO2-EOR), with CO2CRC currently leading a landmark national study to evaluate the economic and technical feasibility of oil recovery in Australia.

The core rod rock samples taken as part of the CarbonNet project will allow scientists to confirm the properties of the rock which hold the stored CO2 in place 1.5km under the seabed.

South West Hub

Led by the Department of Mines, Industry Regulation and Safety (DMIRS),

The South West Hub CCS project is a leading initiative to establish the feasibility of storing industrially-generated CO2 deep underground in the Lesueur Sandstone formation near Harvey in WA.

Between 2011 and 2015, the hub collected data and core samples through stratigraphic wells drilled by MB Century and Perth-based company DDH1.

DMIRS Geological Survey and Resource executive director Jeff Haworth said geological and engineering modelling in 2018 indicated the hub was viable for CCS.

“Recent research has focused on reducing risk and uncertainty to allow the project to progress towards commercial-scale CO2 storage,” Mr Haworth said.

“Industries likely to use the SW Hub include mining and associated processing, oil refinery and gas processing, chemical and fertiliser manufacturing, coal-fired and gas-fired power stations, cement production, hydrogen production using steam methane reforming and enhanced oil recovery.

“Commercial-scale CO2 storage will likely require appropriate policy and legislative support, and sufficient capital allocation for further research funding.”

The project’s research has indicated CO2 injected into the target reservoir at a rate of 800,000t per annum for 30 years at a depth of 3000m can be contained within the Lesueur Formation for at least 1000 years.

The next stage of the collaborative project will depend on available funding with the hub’s future to be discussed at a workshop being held later this year between government departments, the CSIRO, academia, and industry players in the south west.

Santos Moomba CCS Project

Santos plans to capture the 1.7mt of CO2 currently separated from natural gas at the Moomba gas processing plant in South Australia each year and reinject it into the same geological formations that have safely and permanently held oil and gas in place for tens of millions of years.

The gas giant is progressing front end engineering (FEED) on the project, which has the potential to significantly reduce emissions and be an enabler for the production of hydrogen in the future.

According to Santos managing director Kevin Gallagher, with the Cooper Basin’s reinjection capacity assessed at up to 20mt of carbon dioxide a year for 50 years, it has the potential to be a large-scale carbon sink for power generators and other industries in eastern and southern Australia.

Next steps

Several industry leaders and experts including Mr Gallagher, Mr Filby and Mr Byers have called for more policy instruments and revenue streams, such as tax incentives and access to carbon credits under the Emissions Reduction Fund, to enable development and large scale deployment of CCS.

“You typically need a price on carbon somewhere around $30 a tonne to make a CCS project work,” Mr Filby said.

He pointed to North America where new projects had been stimulated by a $50/t tax credit for each tonne of CO2 captured and permanently stored.

A spokesman for the federal Department of Industry, Science, Energy and Resources said its Technology Investment Roadmap outlines how technology, including CSS, can play a part in lowering emissions.

Expert agencies including the International Energy Agency and the Intergovernmental Panel on Climate Change (IPCC) have found CCS deployment at scale is needed to meet Paris goals.

“But more effort is needed to develop this technology so it can contribute meaningfully to emission reductions in Australia,” he said.

“The IPCC has similarly indicated that excluding CCS from the portfolio of emissions reduction technologies would double abatement costs to reach Paris targets.”

The Government agreed to 21 of 26 recommendations made by an expert panel review headed by former Origin Energy boss Grant King, whose suggestions included encouraging greater participation in the Emissions Reduction Fund and ways of enabling low emission technologies.

“In response to the King Review panel’s recommendation, the Government has commenced initial scoping with industry on the development of a method for Carbon Capture and Storage that will qualify under the Emissions Reduction fund,” he said.