Santos sees decarbonisation as new opportunity for Australia
Decarbonisation is a new industry opportunity for Australia through carbon capture and storage (CCS), biological sequestration in soil and vegetation, and development of a new hydrogen industry, Santos CEO Kevin Gallagher told Appea conference on June 15.
“Just as Japan and Korea have counted on Australia to supply the energy resources to feed their economies over the last half-century, they and other countries can look to Australia to help meet their emissions reduction targets,” he said.
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Gallagher said Australia has the right geology for CCS. “Australia has vast tracts of land on which it can store carbon from the atmosphere through soil and vegetation – a fantastic opportunity for our farmers and pastoralists,” he added.
Later this year Santos will take a final investment decision on one of the world’s largest CCS projects, after the Clean Energy Regulator’s methodology for CCS to generate Australian Carbon Credit Units is in place, he said.
CCS could not only reduce Australia’s emissions, Gallagher said, but can protect existing domestic and export industries by creating offset opportunities for industries from airlines to manufacturing, preventing the loss of tens of thousands of well-paid jobs across the country.
“It could also open up a new export industry for Australia – building on our existing trade and investment in LNG with future trade and investment in carbon credits and clean fuels such as hydrogen and carbon-neutral LNG,” he said.
Gallagher said there is a fundamental disconnect between what the world says it wants from the energy transformation and its consumption patterns. “In the International Energy Agency’s recent Net Zero by 2050 scenario, the share of OPEC oil supply rises to over 50%, the highest in history. This will increasingly put oil supply security and prices for countries like Australia in the hands of the cartel,” he argued.
He said that major producers know that demand for oil and gas is not going to decline as fast as the world might want.