Kevin Morrison,an energy analyst at the Institute for Energy Economics and Financial Analysis,said the Evans Shoal project,with 29 per cent of CO2 in the reservoir 300 kilometres north-west of Darwin,is a particularly dirty gas export project. The sector already accounts for four of Australia’s top five industrial greenhouse gas emitters.
Italian firm Eni plans to expand Santos’ gas export plant near Darwin to process gas from its Evans Shoal field.Santos
“The Evans Shoal field would detonate a carbon bomb both here in Australia,when it is extracted,and another when the gas is burned by customers overseas,” Morrison said.
Eni plans to develop the 11 trillion cubic feet field by piping the gas to an expanded Santos liquified natural gas plant in Darwin. The plan is similar in size and scope to Woodside’s $US12 billion ($17.7 billion) Scarborough project,but Woodside has negligible CO2 from the reservoir to capture and store.
Despite the size of the investment decision,Eni has published little information on the project,which it recently renamed Verus – Latin for “truth”.
According to a January 2023 company presentation,carbon dioxide would be separated from the gas in Darwin and piped 500km to the soon-to-be-shuttered Bayu Undan gas field in Timor-Leste waters,where Santos intends to store carbon dioxide from its own Barossa field.
However,Santos does not plan to commit to carbon storage at Bayu Undan until 2025,well after Eni’s target of a December 2023 investment decision on Evans Shoal.
Morrison said transporting carbon dioxide 800km for storage did not add up,especially since Chevron’s attempt to bury carbon dioxide less than 20km from its Gorgon LNG plant in Western Australia is only operating at a third of its design capacity six years into operation.
“It’s highly questionable,” Morrison said of Eni’s plan to develop the field,which was discovered by BHP 35 years ago.
“It’s all very well to sell this in a marketing presentation,but … it just seems very aspirational at best.”
Evans Shoal will export “carbon-neutral LNG” and make a “major contribution” to Australia’s emissions reduction targets,an Eni presentation said. The company has a target of net-zero emissions from its global oil and gas production by 2030.
In Milan,an Eni spokesman said the Verus project was not incompatible with its corporate climate goals.
However,even if all the CO2 from the reservoir is buried,there would still be significant emissions from gas burnt to power the offshore facility and the LNG plant. If Eni’s project is similar to Santos’ nearby Barossa project,emissions would total about 3 million tonnes,ranking it in the top 10 of industrial polluters in Australia.
Recent changes to the federal government’s safeguard mechanism,which governs carbon pollution outside the power sector,requires all CO2 in a gas field to be captured and stored,or offset with carbon credits.
Rick Wilkinson,chief executive of the Energy Quest consultancy,said either measure would add to the cost of the gas,with the price of any offset likely to rise.
“What we see in the market is that not all of the offsets are of the same quality,” he said.
“As this gets tightened up,there’ll be fewer offsets available,and there will be higher costs.”
Australia Institute climate director Polly Hemming said the “net-zero” requirement for gas fields was clearly not deterring development if Eni was pursuing the development of such a dirty field.
“Net-zero is essentially a meaningless term,” she said.
Hemming said just last week that the NT government announced and,despite noting “regulatory hurdles”,Woodside was persevering with its Scarborough and Browse projects.
“There is no sign Australia’s fossil fuel expansion is slowing,let alone stopping.”
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