Broadspectrum subsidiary Easternwell has inked a drilling services contract to formalise proceedings with CO2CRC.
CO2CRC declared yesterday that its largest emissions reductions project kicked off at Nirranda South, with Easternwell's Advantage rig starting work last week to decommission an existing well before it will drill a new 1600m-deep well to allow CO2 injection at the Otway Research Facility in south-west Victoria.
CO2CRC has invested more than $100 million into the site - what it calls one of the best characterised carbon storage sites in the world - over the past decade.
The $42 million CCS project will focus primarily on developing a cost effective "smart field" where up to 40,000 tonnes of CO2 will be injected underground and monitored using various new tools and techniques in real-time.
The injection amount is necessary to model a commercial storage project for 4MMtpa of CO2.
The project has been designed to allow the data to be transferrable to different environments both onshore and offshore, making it a valuable investment for a range of industries.
CO2CRC CEO Tania Constable said the smart field would give regulators and the community confidence that the CO2 can be constantly monitored at low costs.
"Once installed in the subsurface, the technology will pinpoint the areas of risk faster and be cheaper to operate than traditional methods of CO2 monitoring," she said.
"Our instruments sit below ground, potentially doing away the need for expensive and disruptive above ground seismic surveys."
CCS scientists from around the world will come together to work on the next phase of the Otway monitoring and verification program.
"Our substantial investment in the Otway Research Facility and supporting businesses in the local community shows that CO2CRC is here to stay for the long-term," Constable said.
Meanwhile the $US1 billion ($A1.31 billion) Petra Nova project, a joint venture between US electricity group NRG Energy and Japan's JX Nippon Oil & Gas, came into service in January on budget and on time, capturing the CO2 from the equivalent of 240 megawatts of power generation.
The commercial-scale post-combustion carbon capture facility is lcoated at NRG's WA Parish generating station southwest of Houston, Texas.
While Petra Nova covers its costs by using the gas for enhanced oil production, global uptake and development of the technology has been slower than expected despite repeated calls that it is necessary to meet global emissions targets.
Former US President Barack Obama's energy secretary Stephen Chu said in 2009 he hoped the country would have up to 10 coal-fired plants with carbon capture in service by last year, but there will be just two this year, with no more on the horizon.
Yet using CO2 for enhanced oil recovery has opened up a path to commercial viability for the struggling technology.
