Inpex pulls Bonaparte CCS project from Federal Review

Japanese energy major Inpex has withdrawn its Bonaparte carbon capture and storage (CCS) project from Australia’s federal environmental review process, citing changes to the Environment Protection and Biodiversity Conservation (EPBC) Act introduced last year.

The Bonaparte CCS project, jointly owned by Inpex, Woodside and TotalEnergies, is designed to store up to 300 million tons of carbon dioxide captured from the Ichthys offshore gas field beneath the seabed approximately 155 miles offshore from Darwin. Inpex has indicated it plans to resubmit the project once the reformed environmental framework comes into effect, expected in February.

Under the original submission, the project would involve constructing up to six gas injection wells alongside subsea pipelines and onshore infrastructure at Darwin’s Middle Arm industrial precinct. Construction was scheduled to begin in 2028, with operations targeted for 2031.

The Department of Climate Change, Energy, the Environment and Water (DCCEEW) suspended its assessment in December to determine whether the project should be reviewed under the EPBC Act or through a strategic assessment agreement with offshore regulator NOPSEMA. The updated legislation is expected to clarify regulatory responsibilities between federal agencies for CCS developments.

Technical, regulatory and economic challenges remain

The withdrawal highlights ongoing regulatory uncertainty facing large-scale CCS projects in Australia, particularly offshore storage proposals that have yet to be deployed domestically at commercial scale.

Environmental groups have previously raised concerns about the environmental and social risks of subsea carbon storage. Critics have questioned the long-term integrity of offshore storage sites, potential leakage risks and impacts associated with seismic testing and increased marine traffic.

Beyond regulatory hurdles, economic challenges continue to weigh on CCS deployment. Analysts argue that existing financial incentives remain insufficient to justify the capital intensity of large-scale capture and storage infrastructure.

Climate Energy Finance director Tim Buckley has previously pointed to Chevron’s Gorgon CCS project as an example of underperformance. Despite more than $3 billion in investment, the facility captured approximately 1.6 million tons of CO2 equivalent in 2024, well below its design capacity.

Under Australia’s Safeguard Mechanism reforms, large emitters such as Inpex are now required to progressively reduce emissions. Inpex reported emissions of 6.7 million tons of CO2 in the year to June 2024, just below its regulatory baseline.

Bonaparte is intended to eventually store up to 10 million tons of CO2 annually, positioning it as one of Australia’s largest proposed carbon storage hubs if regulatory approvals and economic conditions align.

source: carbon herald