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Santos announces booking of CO2 storage capacity

Santos today announced a booking of 100 million tonnes of CO2 storage resource in the Cooper Basin in South Australia.

This represents a subset of the total prospective storage resource in the Cooper Basin and follows the final investment decision on the 1.7 million tonne per annum Moomba carbon capture and storage (CCS) project in November 2021.

Santos believes this is the first booking in the world in accordance with the CO2 Storage Resource Management System (SRMS) sponsored by the Society of Petroleum Engineers.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said today’s announcement of storage capacity in the Cooper Basin is a significant step in Santos’ decarbonisation pathway and carbon storage hub strategy.

“CCS is a critical technology to achieve the world’s emission reduction goals and we only have to look at current carbon prices to see how valuable 100 million tonnes of storage is,” Mr Gallagher said.

“Santos sees CO2 storage capacity as a strategic competitive advantage in evolving cleaner energy, clean fuels and carbon markets. This globally significant carbon storage capacity booking is another tangible example of Santos leading the way in establishing the foundations to support the energy transition.”

The announcement forms part of the release of Santos’ Annual Reserves Statement. Proved plus probable (2P) reserves increased by 80 per cent to 1,676 million barrels of oil equivalent (mmboe) at the end of 2021, primarily due to the final investment decision on the Barossa project and the Oil Search merger.

Key highlights:

  • 907 per cent one-year 2P reserves replacement
  • 355 per cent three-year 2P reserves replacement
  • 187 per cent three-year organic 2P reserves replacement
  • 2P reserves were added in 2021 from Barossa FID (373 mmboe) and the Oil Search merger (416 mmboe)
  • 149 per cent GLNG 2P reserves replacement in 2021
  • 2C contingent resources increased by 41 per cent to 3,219 mmboe

2P reserves increased by 835 mmboe before production in 2021. The annual 2P reserves replacement was 907 per cent and the three-year replacement 355 per cent.

“Today’s statement is the result of Santos’ disciplined annual reserves process, which include external audit of approximately 94 per cent of total 2P reserves,” Mr Gallagher said.

The merger with Oil Search added 416 mmboe of 2P reserves while the final investment decision on Barossa added a further 373 mmboe. Santos has booked Barossa reserves at a 50 per cent interest following the execution of a binding Sale and Purchase Agreement to sell a 12.5 per cent stake in Barossa to JERA, completion of which is expected in the first half of 2022.

Consistent application of Santos’ disciplined operating model also delivered reserves increases in the onshore assets in 2021. GLNG achieved greater than 100 per cent 2P reserves replacement for the second year in a row, while reserves were also added in the Cooper Basin before production.

2C contingent resources increased by 41 per cent to 3,219 mmboe, primarily due to the Oil Search merger partially offset by the commercialisation of Barossa 2C resources to reserves at FID.

The Oil Search merger added 819 mmboe 2C in Papua New Guinea and 401 mmboe in Alaska. The gross 2C contingent resource in Alaska is unchanged from that previously reported by Oil Search, but in accordance with the 2018 Petroleum Resources Management System (PRMS), Santos has adjusted its net share Alaska 2C resource to remove royalties.