The project has also been registered with the Clean Energy Regulator to qualify for Australian Carbon Credit Units over a crediting period of 25 years.

The plant is expected to store about 1.7 million tonnes of carbon per year from 2024.

Santos has a 66.7 per cent share in the project while fellow Cooper Basin operator Beach Energy owns 33.3 per cent.

The two Adelaide based companies announced the final investment decision late yesterday following the project’s registration with the Clean Energy Regulator.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said the company was already receiving significant international interest in its CCS and hydrogen plans.

“This carbon reduction project in the South Australian outback will be one of the biggest and lowest cost in the world and will safely and permanently store 1.7 million tonnes of carbon dioxide per year in the same reservoirs that held oil and gas in place for tens of millions of years,” he said.

“We forecast a full lifecycle cost of less than US$24 per tonne of CO2 including cash costs in operation of US$6-8 per tonne of CO2, with first injection targeted for 2024.

“This decision is a critical step in decarbonising natural gas on our path to new low-emissions and clean-burning fuels such as hydrogen.”

Gallagher last week used a speech to lobby for the opening up of international carbon markets ahead of this week’s COP26 climate summit in Glasgow.

There are about 25 carbon capture storage projects operating around the world that store almost 40 million tonnes of CO2 each year, including Chevron’s 4 million tonnes per annum Gorgon project in Western Australia.

Beach Energy Managing Director and Chief Executive Officer Matt Kay said the Moomba CCS project would deliver a step-change in Beach’s CO2 emissions profile.

“For more than 50 years, natural gas-filled reservoirs in the Cooper Basin have played an important role in delivering Australia’s energy needs, so in many ways it is fitting some of these same reservoirs will play a role in reducing Australia’s emissions,” he said.

“Natural gas will continue to be a critical source of energy, even in a lower carbon future, and we are committed to playing our part in reducing our emissions footprint – our participation in the Moomba CCS Project is a clear indication of that.”

Santos shares were up about 1 per cent to $7.17 this morning while Beach Energy shares were steady at about $1.40.

Santos was confirmed as the state’s largest company when it was ranked No. 1 in the InDaily 2021 South Australian Business Index last month.  Beach Energy was ranked No. 4.