Moomba CCS Project Achieves Major Sequestration Milestone, Paving Way for Australia’s Carbon Storage Leadership
Santos Ltd. has announced a significant operational triumph at its Moomba Carbon Capture and Storage (CCS) project in onshore South Australia, with the facility permanently sequestering an impressive two million metric tons of carbon dioxide equivalent (CO2e) over its initial 18 months of operation. This achievement, a critical benchmark in the global energy transition, equates to removing the annual emissions from 826,000 passenger vehicles, underscoring Moomba’s substantial impact on decarbonization efforts.
This rapid progress positions Santos to meet its ambitious 2030 Scope 1 and 2 equity emissions reduction targets five years ahead of schedule. Kevin Gallagher, Santos’ Managing Director and Chief Executive, highlighted Moomba’s proven capability to deliver emissions reductions at scale. While Santos announced the project’s operational start in October 2024, the subsequent reporting confirms a strong performance trajectory. During the 2024/2025 reporting period, Moomba CCS alone accounted for approximately one million metric tons of CO2e stored, representing a third of the total reduction in Safeguard Mechanism-covered emissions compared to the previous year, a testament to its pivotal role within Australia’s industrial emissions framework.
Strategic Value and Carbon Credit Generation
The Moomba CCS project’s financial and environmental credentials are further solidified by its generation of Australian Carbon Credit Units (ACCUs). To date, the project has garnered over 1.19 million ACCUs for the CO2e injected from its inception through September 30, 2025. These valuable credits demonstrate the tangible economic benefits associated with large-scale carbon capture, offering a clear pathway for investors to understand the financial upside of such ventures. The injection process routes CO2 into depleted hydrocarbon reservoirs strategically located near the Moomba oil and gas gathering and processing complex, which serves the prolific Cooper and Eromanga basins. This leverages existing infrastructure and geological understanding, enhancing efficiency and reducing project complexity.
As Australia’s pioneering large-scale onshore hub for CO2 capture and geological storage, Moomba CCS boasts a design capacity to store up to 1.7 million metric tons per annum (MMtpa) of CO2, contingent on CO2 availability. This capacity is comparable to neutralizing the annual emissions of 700,000 gasoline-powered cars, solidifying its position as a cornerstone of the nation’s emissions reduction strategy.
Propelling Australia Towards a Carbon Storage Hub
Santos’ leadership envisions Australia as a global powerhouse for carbon storage, attracting significant international investment and fostering new, high-skilled employment opportunities. Gallagher emphasized the immense potential within Santos’ acreage across the Cooper and Eromanga Basins, which could accommodate the injection of up to 20 million metric tons of CO2 per year for as long as 50 years. This vast storage capacity positions the region as a crucial destination for hard-to-abate sectors like steel and cement, offering cost-competitive, proven decarbonization solutions.
The Moomba CCS project operates under a joint venture, with Santos Ltd. holding a controlling 66.7 percent stake and serving as the operator, while Australian oil and gas producer Beach Energy Ltd. holds the remaining interest. This partnership exemplifies collaborative efforts within the industry to tackle climate challenges while maintaining energy security.
Forging Global and Domestic Partnerships for Expansion
Momentum for Moomba CCS Phase Two as a commercial service is rapidly building, driven by significant agreements already secured with prospective domestic and international clients. As early as October 2024, when the project’s startup was announced, Gallagher highlighted the strong market interest, signaling a robust future for fee-for-service carbon sequestration.
A pivotal development occurred in December 2023, following Australia’s passage of legislation permitting foreign companies to transport CO2 through Australian waters for sequestration. This legislative clarity immediately spurred international collaboration, with two major Japanese entities partnering with Moomba CCS. Santos signed a Memorandum of Understanding (MoU) with JX Nippon Oil & Gas Exploration Corporation and ENEOS Corporation. This agreement initiates a joint feasibility study aimed at evaluating the logistics and potential for capturing, transporting, and sequestering industrial emissions originating from Japan, thereby supporting a substantial expansion of the Moomba CCS project.
Furthermore, the aggregation and management of carbon at Moomba aligns seamlessly with Santos’ broader Energy Solutions initiatives, particularly its low-carbon fuels ambitions. This includes ongoing studies with Tokyo Gas and Osaka Gas focused on the potential for low-carbon e-methane production in the Cooper Basin. Such an endeavor would involve combining green hydrogen with CO2 sourced from industrial emissions or direct air capture, establishing a circular economy model for exporting e-methane.
The Japanese consortium’s study outlines ambitious import targets for CO2 into Moomba: 5 MMtpa by 2030, escalating to 10 MMtpa by 2035, and a remarkable 20 MMtpa by 2040. Potential import terminals include Gladstone, Queensland, or Port Bonython, South Australia, underscoring the strategic regional importance of these industrial hubs.
Domestic partnerships are also advancing the project’s infrastructure. In November 2023, Santos inked an agreement with Australian power producer and gas distributor APA Group. This collaboration focuses on assessing optimal CCS pipeline transport routes from major emission sources in Gladstone, Port Bonython, and Greater Sydney to the Moomba CCS facility in the Cooper Basin, creating a national carbon transport network.
Beyond regional collaborations, Santos has also established an agreement with Abu Dhabi National Oil Co PJSC (ADNOC) for potential cooperation in developing advanced CCS technologies and providing essential CCS services, including shipping solutions. This pact also explores potential joint investments in future CCS projects, highlighting the global reach and collaborative spirit driving this crucial sector.
Investor Outlook: Santos’ Vision for a Carbon Storage Business
These developments are integral to Santos’ overarching strategic objective: to build a robust carbon storage business capable of permanently sequestering 14 MMtpa of third-party CO2e emissions by 2040. As announced in November 2024, this ambitious target signals a clear diversification strategy for the energy giant, leveraging its geological expertise and operational capabilities to become a leading provider of industrial decarbonization services. For investors, Moomba CCS represents a tangible asset demonstrating Santos’ commitment to sustainable practices and its proactive role in the energy transition, while simultaneously unlocking new revenue streams through carbon credit generation and commercial sequestration services. The project’s current success and future expansion plans position Santos as a compelling investment in the evolving landscape of sustainable energy and industrial decarbonization.