Gas ‘main game’ in energy transition – Santos boss

Australia cannot afford to turn its back on gas or shun industries such as carbon capture to deliver the energy transition, Santos managing director Kevin Gallagher says. Stressing the importance of containing energy costs, Mr Gallagher described renewables as part of the energy solution, but warned they were not the holy grail. "The main game is gas because it makes renewables possible, it provides feedstock for fertilisers and chemicals, and it fires the high temperature furnaces required for bricks and cement," he said. "However, while getting to net zero should be all about emissions reductions, our opponents are only about killing oil and gas." Mr Gallagher was speaking at the Australian Petroleum Production & Exploration Association (APPEA) 2023 Conference & Exhibition in Adelaide. Santos managing director and chief executive officer Kevin Gallagher. He argued that if governments were truly anti-emissions rather than anti-fossil fuels, they should embrace the ongoing use of abated oil and gas, synthetic methane, direct air capture and CCS. The benefits of using existing infrastructure and energy systems would save trillions of dollars and deliver net zero without compromising our standards. "As the IEA’s status report on carbon capture, utilisation and storage stated last September, 'To translate momentum into action, policy makers should roll out additional policy support, while also ensuring that appropriate legal and regulatory frameworks are in place. "Growing recognition of CCUS technologies’ role in meeting net zero goals is translating into increased policy support such as in the United States, where the Inflation Reduction Act (IRA) of 2022, coupled with funding under the Infrastructure Investment and Jobs Act, is expected to incentivise greater CCUS deployment." He said Australia could be both a clean energy superpower and a carbon storage superpower. "This is Australia’s competitive advantage in the world – in gas, in critical minerals, in carbon storage resources as well as renewable energy," Mr Gallagher said. "It is an area where our people have skills and know-how. And, as a responsible global citizen, it is our duty to use this advantage to continue to grow and decarbonise our own economy as well as the economies of our trade and investment partners in Asia. "These economies and the prosperity of their societies have been built on Australian resources for decades. However, Australia is falling behind the United States which is growing both its gas industry and its CCS industry because it understands the ongoing need for abated gas in its own economy and in customer countries in Europe and Asia. "And because Australia does not yet have the regulatory frameworks in place to offer carbon storage capacity that Japan and Korea need, they are now looking to Indonesia and Malaysia. "Australia simply cannot afford to turn its back on the gas industry or to shun the opportunity of new, exciting industries such as CCS and synthetic methane which have the potential to deliver the energy transition faster and at lower cost." Mr Gallagher said he welcomed the Federal Government’s announcement in the Budget of a review to examine opportunities for regulatory and administrative certainty and efficiency for carbon capture and storage projects. "The industry is ready to invest and we are anxious to work with the government as a matter of urgency in a process to define these opportunities so that Australia is not left behind the US, Europe, Indonesia and Malaysia in the race to build new, low-cost abated gas and other decarbonisation industries," he said. Santos is about a year away from first injection of CO2 at its Moomba CCS project - the first in a three-hubs strategy for CCS in Australia that includes Darwin/Bayu-Undan and Western Australian sites. Moomba CCS is expected to store up to 1.7 million tonnes of CO2 per year. .

Gas ‘main game’ in energy transition – Santos boss

Industry Queensland

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