The Santos Ltd (ASX: STO) share price is even in early trading on Tuesday amid the energy giant hitting near 52-week highs after gathering strength over the past 6 weeks.
At the time of writing, the Santos share price is flat at $7.55, the same as yesterday's close.
The S&P/ASX 200 Energy Index (XEJ) is up more than 13% this year to date whereas the benchmark S&P/ASX 200 Index (ASX: XJO) is down 4.5% over the same time.
Today investors are digesting a company announcement from Santos regarding a new CO2 storage capacity deal, which could be the first of its kind. Here are the details.
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What did Santos announce?
The company advised it had secured a booking of 100 million tonnes of CO2 storage resource in the Cooper Basin in South Australia.
According to Santos, this number signifies "a subset of the total prospective storage resource in the Cooper Basin" and follows a final investment decision on the Moomba carbon capture and storage (CCS) project back in November.
Santos also understands this booking is the first in the world "in accordance with the CO2 Storage Resource Management System (SRMS) sponsored by the Society of Petroleum Engineers".
Speaking on the announcement, Santos Managing Director and Chief Executive Officer Kevin Gallagher said:
CCS is a critical technology to achieve the world's emission reduction goals and we only have to look at current carbon prices to see how valuable 100 million tonnes of storage is.
Santos sees CO2 storage capacity as a strategic competitive advantage in evolving cleaner energy, clean fuels and carbon markets. This globally significant carbon storage capacity booking is another tangible example of Santos leading the way in establishing the foundations to support the energy transition.
Today's announcement also forms part of Santos' Annual Reserves Statement. At the end of 2021, proved plus probable (2P) reserves increased by 80% to 1.16 billion barrels of oil equivalent (mmboe).
Santos attributes this gain to the final investment decision on the Barossa project and the Oil Search merger.
In fact, the merger with Oil Search added 416 mmboe of 2P reserves, 819 mmboe of 2C in Papua New Guinea, and 401 mmboe in Alaska. As well, the final investment decision on Barossa added a further 373 mmboe, according to the company.
The company also advised its binding Sale and Purchase Agreement to sell a 12.5% stake in Barossa to JERA is expected to complete in 1H 2022.
Santos share price snapshot
Over the last 12 months, the Santos share price has gained more than 7%. However, this year to date, shares have powered ahead almost 20%.
Each of these returns is far ahead of the performance of the benchmark index.
Santos has a market capitalisation of more than $25 billion.
