Santos To Explore Cheap Direct Air Capture For Green Methane Production

Santos To Explore Cheap Direct Air Capture For Green Methane Production - Carbon Herald
Image: T. Schneider/Shutterstock

Australian energy major Santos Ltd (ASX: STO) is currently testing a new direct air capture (DAC) technology which could significantly reduce the cost of drawing carbon dioxide (CO2) directly out of the atmosphere and enable the company to produce a climate-friendly alternative to natural gas, CEO Kevin Gallagher told journalists last week.

The new technology, which absorbs fluid from the air and then heats it to extract the CO2, could be less energy intensive than many existing methods and therefore bring DAC costs down to just $75 per ton by 2030, according to the executive.

“A lot of the technologies around the world require very high temperatures to heat the fluid up for the CO2 to be released,” Gallagher explained, as cited by Bloomberg. “Ours is designed to execute the process at a much lower temperature, at around 75°C (167°F).”

Currently, capture costs at a large-scale DAC plant range from $135 to $335 per ton and are expected to go as low as $100 per ton by 2030 thanks to innovations in technology and scale, according to a 2022 report by the International Energy Agency (IEA).

Relevant: Santos To Inject CO2 In Depleted Gas Reservoirs

Initially, Santos’s plan is to permanently store the captured CO2 in depleted underground gas reservoirs in South Australia, which would lead to the generation of carbon credits. These could then be sold to companies looking to offset their greenhouse gas (GHG) emissions.

In the longer term, however, the extracted CO2 could be combined with hydrogen to produce green methane — an alternative to fossil fuels, Gallagher said. If the process becomes economic enough, green methane could “possibly” replace the company’s natural gas production entirely by around 2050, he added.

Carbon-neutral methane has lower capital costs associated with it compared to other green energy sources, for example hydrogen or ammonia, since it can use the existing energy infrastructure, according to Timothy Wall, a senior adviser at energy consultancy firm DSS+.

However, the challenge with green methane is finding a cost-effective source of CO2 to be used as raw material for its production, Wall explained.

Santos is Australia’s second-biggest gas producer, with nearly 1300 suppliers and operations across Australia, Papua New Guinea, Timor-Leste, and North America.

Read more: IEA Says Carbon Markets Can Scale Direct Air Capture Tech

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