An Italian energy company has quietly revived plans to develop a new gas field in the Timor Sea which contains some of the most carbon-intensive gas in Australia.
The Evans Shoal gas field, about 300 kilometres north-west of Darwin, was discovered 35 years ago and has since passed through the hands of BHP Petroleum, Woodside, Shell, and Santos.
Since 2017 it has been controlled by Eni, an Italian energy company that operates in more than 60 countries, which has recently renamed the project Verus.
The gas in the Verus field has a very high percentage of carbon dioxide — an average of 27 per cent, according to Geoscience Australia.
"That is far more than any other gas field that is being developed in Australia," said Kevin Morrison from the Institute of Energy Economics and Financial Analysis (IEEFA).
For comparison, the gas field neighbouring Verus, the Santos-owned Barossa, has a high CO2 content at 18 per cent which is significantly higher than Woodside's Scarborough gas field in Western Australia with just 0.1 per cent CO2.
Mr Morrison said the high carbon dioxide content of Verus' gas has deterred previous companies from developing the project.
"People are concerned about the costs of removing the CO2 because there is so much of it, and that's why these previous project proposals have fallen over," he said.
"Now it's being proposed again in an environment where Australia has toughened its emissions reductions targets. Its brought in its safeguard mechanism which this project would come under.
"So, it was quite a surprise to see Eni executives … are targeting a final investment decision [FID]."
Eni has made few public announcements about its likely multi-billion-dollar development, but it in January it gave a presentation in Darwin outlining its proposal and a FID targeted for late 2023.
How will Eni deal with carbon emissions?
A report by IEEFA has labelled the project a "carbon bomb", estimating emissions from the Verus field could amount to at least 7.5 million tonnes of carbon dioxide per year — not counting the emissions produced when the gas is burnt by customers.
Such emissions would account for around 7.5 per cent of the allowable missions under the federal government's safeguard mechanism and would make it one of Australia's highest emitting projects.
"When you do the numbers on how much we are supposed to reduce our emissions under the safeguard mechanism you really do have to question 'where is there room for a project like [Verus]?'" Mr Morrison said.
Eni has outlined plans to deal with Verus' high carbon content by separating the CO2 from the gas at the Darwin LNG plant, then piping it around 500 kilometres to the depleted Bayu-Undan field where it will be buried below the sea floor.
In a January presentation given by Eni and seen by ABC Rural, the company claimed 100 per cent of its CO2 could be safely stored in the depleted gas reservoir, allowing it to ship "carbon-neutral LNG".
Wood Mackenzie gas analyst Anne Forbes said Santos' work on its Bayu-Undan carbon capture and storage (CCS) project, and that a pipeline to the field was already in place, simplified the project for Eni.
"It effectively has a [CCS] input system right there in Darwin ready for them so they can piggy-back off projects and infrastructure that is already in process and in place," Ms Forbes said.
"It shouldn't add too much extra difficulty or complication, in theory, to their project."
Eni's presentation included an option for "up to 400 megawatts of renewable [energy] to support liquefaction and CCS".
Questions over carbon capture and storage
Santos estimates its Bayu-Undan CCS project could store 10 million tonnes of CO2-equivalent per year.
But with the estimated 5.5 million tonnes of carbon emissions from Santos' Barossa project — which is also expected to send its CO2 to Bayu-Undan — there might not be enough capacity for both projects.
"So, there's another three million tonnes that is either just going to go up into the atmosphere or there's going to be three million tonnes of carbon offsets," IEEFA's Kevin Morrison said.
"There is so much carbon dioxide coming out of these two fields that it's going to be way beyond what they're planning to do in terms of trying to bury the CO2.
"When you add up what the emissions will be from the Barossa gas field, which is currently under development by Santos, it could add up to almost the amount that the whole of the Northern Territory emits each year."
Mr Morrison also said carbon capture and storage has a poor track record of success with the largest project, Chevron's Gorgon in Western Australia, failing to meet its storage targets despite being just 20 kilometres from its gas feed source.
Another complicating factor is that Eni plans to send Verus' gas to the Darwin LNG plant in a 300-kilometre-long pipeline that runs, for most of the way, 100 metres parallel to Santos' proposed pipeline from its Barossa field.
Tiwi Islands traditional owners have voiced opposition to the route of Santos' pipeline citing potential impacts to environment and cultural sites, and have launched multiple court challenges against the project.
This week, environmental groups launched court proceedings against Eni in Italy over allegations that despite knowing about fossil fuel impacts on climate change since the 1970s the company had lobbied for more fossil fuel production.
Eni did not respond to ABC Rural's request for comment.
