Australia’s oil and gas industry needs to urgently fast-track the creation of energy ‘super basins’ to provide a pathway to greater sustainability and cut emissions, according to Anne Forbes, Upstream Research Analyst at Wood Mackenzie.
A super basin is an area where large hydrocarbon resources are co-located with the potential for plentiful clean electricity and large-scale carbon capture and storage (CCS).
Speaking at the Australian Petroleum Production and Exploration Association (APPEA) Conference in Adelaide, Dr Forbes said that development of super basins in Australia is possible in certain advantaged locations, but will be challenging in the prevailing economic conditions where additional costs can impact profit margins.
“As upstream becomes more entwined with low- and no-carbon businesses, some serious questions are going to be asked of Australian operators,” Anne Forbes told delegates at the event.
“Turning Australia’s vast deposits of disadvantaged gas into a better – and more resilient – investment opportunity is going to require collaboration across the whole energy spectrum, something that has historically rarely happened in the sector.”
Australia has among the highest CO2 intensity per boe of the major producing countries, coming in at an average 42 tonnes of CO2 per produced per thousand barrels of oil equivalent (kboe). This is caused mainly by the dominance of the liquefied natural gas (LNG) sector in Australia, which utilises an energy-intensive liquefaction process.
“If Australia is serious about creating the next generation of super basins to prolong its upstream lifespan, CCS is going to have to play a far larger role in the process and plentiful clean electricity is also essential,” Anne Forbes said.
“This is not going to be easy in the short-term – and will require government/policy support – but the fact remains that Australia’s most ‘advantaged’ basins are blessed with world-class solar and/or wind potential.”
Global upstream super basins were originally defined as holding more than 10 billion barrels of oil equivalent (boe) of recoverable resource, of which more than 5 billion boe remains. Globally, more than 90% of current oil and gas production comes from around 40 super basins.
Wood Mackenzie expects Australia to rank as the eighth highest upstream producing country in terms of scope 1 and 2 greenhouse gas emissions between now and 2030.
