Geological storage of CO2 in the offshore Gippsland Basin, Australia, is being investigated by the Cooperative Research Centre for Greenhouse Gas Technologies (CO2CRC) as a possible method for storing the very large volumes of CO2 emissions from the nearby Latrobe Valley area. A storage capacity of about 50 million tonnes of CO2 per annum for a 40-year injection period is required, which will necessitate several individual storage sites to be used both sequentially and simultaneously, but timed such that existing hydrocarbon assets will not be compromised. Detailed characterisation focussed on the Kingfish Field area as the first site to be potentially used, in the anticipation that this oil field will be depleted within the period 2015–2025. The potential injection targets are the interbedded sandstones of the Paleocene-Eocene upper Latrobe Group, regionally sealed by the Lakes Entrance Formation. The research identified several features to the offshore Gippsland Basin that make it particularly favourable for CO2 storage. These include: a complex stratigraphic architecture that provides baffles which slow vertical migration and increase residual gas trapping and dissolution; non-reactive reservoir units that have high injectivity; a thin, suitably reactive, lower permeability marginal reservoir just below the regional seal providing mineral trapping; several depleted oil fields that provide storage capacity coupled with a transient production-induced flow regime that enhances containment; and long migration pathways beneath a competent regional seal. This study has shown that the Gippsland Basin has sufficient capacity to store very large volumes of CO2. It may provide a solution to the problem of substantially reducing greenhouse gas emissions from future coal developments in the Latrobe Valley.