Santos boss Kevin Gallagher delivers spirited defence of oil and gas, backs CCS

Santos boss Kevin Gallagher has launched a spirited defence of oil and gas and declared the scaled adoption of carbon capture and storage as essential to achieving net zero emissions by 2050. Speaking at the annual Australian Petroleum Production and Exploration Association in Brisbane on Wednesday, Mr Gallagher cited the International Energy Agency’s prediction that the world would still be using oil and gas in 2050, even under the most ambitious carbon reduction scenario. “There’s an uncomfortable reason for this – we simply don’t have alternatives today to replace oil and gas in myriad uses that go far beyond electricity generation and transport,” he said. “Those uses include the fertilisers that have allowed us to produce more food using less water and less land, the cement and steel that have built our modern cities, and the polymers that are the building blocks for the clothing, plastics and chemicals we use every day. “If we want an economy that makes things, we are going to need oil and gas because renewables cannot replace them as feedstocks for fertilisers and polymers, or in high-temperature applications such as brick and cement kilns, steel furnaces and aluminium pot lines.” Mr Gallagher said the world needed to maintain momentum on energy transition, but without compromising energy security and affordability, and continue to strive for universal access to reliable energy. “We can only do this through decarbonisation, not de-fossilisation,” he said. Mr Gallagher said CCS needed to be deployed globally at scale to achieve net zero by 2050. “The new focus on stopping oil and gas projects in environmentally-responsible jurisdictions such as Australia is centred around discrediting a proven technology for low-cost, large-scale emissions reduction – CCS,” he said. But Mr Gallagher said no technology could make a bigger difference to the energy transition than carbon capture and storage, with the IEA saying it will be almost impossible to achieve net zero by 2050 without it. He said CCS, which Exxon had been using since 1970, had already been successfully deployed in 27 commercial projects around the world, including the biggest in Chevron’s Gorgon LNG project in WA, which had already stored 6 million tonnes of CO2 since it started in 2019. Mr Gallagher said Santos was building a 1.7 million tonne per year CCS project at Moomba in South Australia’s Cooper Basin. “The exciting thing about the Cooper Basin is that there is storage capacity for up to 20 million tonnes of CO2 per year for up to 50 years,” he said. “That would be equivalent to taking one-third of light duty vehicles off Australian roads each year.” Mr Gallagher said Moomba would also be one of the lowest cost CCS projects in the world at around $US24 per tonne. “At Moomba, we are also trialling CSIRO and other direct air capture and post combustion capture technologies,” he said. “These exciting technologies have the potential to negate emissions elsewhere in the economy, especially in hard-to-abate sectors that Australia still needs.” Responding to a question, Mr Gallagher said he was not worried about the outcome of Saturday’s Federal Election but called on the major parties to agree on a long-term national energy strategy and policy to help guide the sector.

Santos boss Kevin Gallagher delivers spirited defence of oil and gas, backs CCS

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