Vintage Energy targets food-grade CO₂ market with Nangwarry gas development

Vintage Energy (ASX: VEN) is confident it can add to its successes at the Vali and Odin fields with the development of the Nangwarry project in South Australia.

While the company’s major focus remains on the growth of Vali and Odin and its gas sales to the energy-hungry east coast market, Vintage has also identified a strategic opportunity to meet a looming deficit in carbon dioxide (CO₂) production.

CO₂ plays several important roles in the food industry including food preservation and beverage production and even has the potential to be converted into food ingredients.

Commercialisation path

Vintage and joint venture (JV) partner Lakes Blue Energy (ASX: LKO) are progressing discussions they hope will lead to agreements that provide a path for commercialisation of the sizeable Nangwarry gas resource.

Located in the onshore Otway Basin, Nangwarry has been assessed to contain a significant low-impurity (>90%) CO₂ resource considered suitable for food-grade product.

The companies have identified an opportunity for long-term supply of an essential input, with CO₂ facing a structural shortage as local supply tightens and production from industrial sources diminishes.

Analysts expect CO₂ production in SA to cease in 2026 with the decommissioning of the Torrens Island power plant.

Substantial resource

Nangwarry has been independently assessed to contain 25.9 billion cubic feet of CO₂, with a successful well test flowing at a stabilised rate of 10.5 to 10.8 million standard cubic feet per day over a 36-hour period and double that rate over shorter periods.

The JV is finalising a Nangwarry project concept for a CO₂ liquefaction and loadout facility with a daily capacity of between 150 and 200 tonnes and an anticipated life of approximately 20 years.

With an indicative time frame from final investment decision to first gas of around 12 to 18 months, the partners anticipate to commercialise the project through a collaborative JV with players in liquefied CO₂.

Australia consumes approximately $333 million worth of CO₂ per annum, with analysts forecasting annualised growth of 1.5% out to 2030.