As Australia strives to reduce its greenhouse gas emissions, a number of carbon capture and storage projects have been proposed. Before they can be implemented, issues remain to be addressed. Industry experts explain.
As the realisation of a Carbon Pollution Reduction Scheme nears, gas companies are looking to methods of capturing and storing their carbon emissions.
The Co-operative Research Centre for Greenhouse Gas Technologies (CO2CRC) has successfully launched the Otway Project, and a number of projects have been mooted such as Santos’ Moomba Carbon Storage Hub, the ZeroGen Geosequestration Project and Aviva Corporation’s Coolimba Power Storage Project. Economies of scale
Other companies have cited concerns over the implementation of carbon capture and storage (CCS) projects, including issues with transportation, costs and legislative support.
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Epic Energy says that the correct description for the industry is carbon capture, transportation and storage (CCTS).
“Given the long distances between the major emitters and long term sinks, transportation is going to be a significant aspect of this industry,” says Epic General Manager Risk and Sustainability Steve Livens.
ERM Power Head of Carbon Peter Stark says that the overall expense of such projects poses a problem.
CO2CRC Chief Executive Officer Peter Cook says “The challenge is trying to minimise your pipeline distance by trying to identify areas where you can store the carbon dioxide close to the major sources. So instead of having a 500 km, pipeline you have a 50 km pipeline; obviously the cost will then come down considerably.”
Mr Cook says that, in this regard, it makes sense for companies to jointly develop such CCS projects. “If you’ve got one producer of 1 million tonnes per annum (MMt/a) of carbon dioxide and they have one pipeline and one drill hole and so on – you’re much better if you can get economies of scale and you get a number of organisations to come together, and instead of 1 MMt/a, you put down 15 MMt/a or 20 MMt/a.”
He uses the example of ConocoPhillips and Inpex, whose respective Wickham Point LNG Project and proposed Ichthys LNG Development, both located in Northern Territory, could choose to share a conversion plant and associated pipeline, as this would make more sense economically.
Offshore and onshore challenges
The Australian Government has released ten offshore permits, located across five basins offshore Victoria, South Australia, Western Australia and the Northern Territory, designated for the assessment of CCS potential.
Mr Cook says that while the cost of developing an offshore CCS project will be more than developing an onshore project, there is good storage potential in offshore basins.
“It is going to cost you several times higher offshore just because it costs more to drill a well offshore and that sort of thing. But on the other hand, if you have better injectivity of the rocks,then you might have to drill fewer holes, So you never know how these things balance out.”
Future legislation
The Government is yet to finalise legislation to support its offshore permit leases and Mr Cook sees a number of issues that need to be addressed.
“You have to ensure that you’ve got an adequate monitoring and verification regime to minimise the prospect of any adverse impact of carbon dioxide storage, and indeed carbon dioxide transportation too,” he says.
He also notes that stakeholder interests need to be addressed and the terms under which permits can be relinquished and returned to the government after a company has finished using them for carbon dioxide storage.
The Australian Government has established the Carbon Capture Flagship program and the Global Carbon Storage Institute to help the development of CCS projects.
Under the flagships program, $2 billion will go toward building up to four industrial scale CCS projects in Australia.
Federal Minister for Energy and Resources Mr Ferguson said “The nominated projects will be reviewed by an independent expert panel which I will establish in consultation with the National Low Emissions Coal Council and the Global Carbon Capture and Storage Institute.”
Mr Livens says that the government needs to support research into the industry and other carbon reduction initiatives. “But in general governments should not distort market outcomes or private investment decisions by providing direct assistance to one carbon reduction project over another.” For more information about the Global Carbon Storage Institute visit the Department of Energy and Resources website: www.ret.gov.au/resources/gccsi/
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