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Coal seam gas: should the gates be locked?

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SEPTEMBER 26, 2011

Coal seam gas: should the gates be locked?

Coal seam gas! It’s controversial and in the news every day. Why has it suddenly become an issue? What is going on? The exploration for and development of coal seam gas (CSG) is a relatively new and small activity in Australia, but the size of the estimated CSG resource suggests that it could grow to become a major industry, and an important new energy export sector. But only if it can overcome some problems.

Coal seam gas occurs naturally in most coal seams and is trapped there by the confining pressure of groundwater. Chemically it is the same as natural gas (i.e. mostly methane) extracted from conventional oil and gas deposits. See the Library’s Background Note for further details.

In its short history the CSG industry has given rise to the following concerns:

• Possible degradation of aquifer systems in the Murray-Darling Basin; • Surface and subsurface contamination from drilling and fracking activities; • Land access and use issues; • Claimed impacts on human and animal health arising from the escape of methane;


• Its greenhouse gas impact when subjected to full life cycle analysis (LCA).

Many concerns about CSG have come from the US, where the industry had influence over policy and regulation which saw requirements of air quality and water protection legislation set aside. In 2010 the U.S. House of Representatives directed the US EPA to assess impacts on drinking water and groundwater from CSG extraction; initial research results are expected by the end of 2012.

In Australia there is plenty of concern about CSG exploration and production, particularly amongst rural-based groups such as the Lock The Gate Alliance Inc.

There is, however, no evidence of significant methane leakage in Australian operations, although recently a small leak occurred at a Queensland drilling site, where the hazard was limited to a three-metre radius. Concerns expressed by groups such as Doctors for the Environment Australia do not articulate any tangible evidence of health impacts from small-scale methane leakage, and mainstream science suggests that fugitive emissions of methane are not directly harmful.

Those opposed to CSG development frequently cite a Cornell University paper as evidence that methane acquired in this way is no more greenhouse-friendly than coal, when all factors are considered (i.e. exploration, construction, mining/extraction, transport, pipeline transmission, storage, combustion, waste management etc, referred to as ‘Life Cycle Analysis’). However, critics point out that the information used in this study was dated, over-emphasized the global warming impact of methane by choosing inappropriate assessment periods, and used higher Global Warming Potential factors than those established by the IPCC. In Australia, burning gas to produce electricity emits around 40% less greenhouse gas than its coal competition.

Two things are necessary for gas to be released from the coal seam: the groundwater pressure has to be reduced (requiring pumping out of water); and the coal beds must be fractured to provide pathways for the gas to move along. Pumping out water will lower the water table, and the availability of water to other users will be compromised. If the water pumped out (a.k.a. “production water”) is contaminated or naturally salty, it poses an environmental risk once at the surface. This risk needs to be carefully managed. Sometimes the coal seam is naturally fractured enough to allow the gas to flow, but if not, then water is pumped into it under great pressure (a process known as hydraulic fracturing, or “fracking”).

In its simplest form the fracking fluid may be water with fine sand (to hold the cracks open), but chemicals are commonly added to help fluid and gas flow, keep the sand in suspension, adjust pH, inhibit rusting of pipework and to prevent algal growth. Some compounds which have been used in the USA are known carcinogens: a US House of Representatives Committee found that between 2005-2009, 750 chemicals were used ranging from harmless

substances such as salt and citric acid, to extremely toxic substances such as benzene and lead, and that 29 were known or suspected to be carcinogenic.

According to the Australian Petroleum Production and Exploration Association, fracking compounds used in Australia are common ingredients in food, hygiene and household cleaning products;, APPEA claims that, at the concentrations used in mining, they are non-toxic. However, toxic substances known as BTEX compounds (benzene, toluene, ethylbenzene, and xylenes - volatile organic compounds found in petroleum products) have been reported in water analyses of some Queensland CGS drillholes, although it appears they probably resulted from contamination by lubricants used in the drilling machinery. As a precautionary measure, the Queensland government has placed stringent limits on BTEX concentrations in fracking fluids which effectively bans their use, and New South Wales has a moratorium on fracking currently in place and is considering a ban on the use of BTEX.

Most of the area prospective for CSG in eastern Australia lies in the Murray Darling Basin, where the economy is dominated by agriculture and communities heavily dependent upon groundwater. CSG dewatering and fracking are likely to affect water availability. Investigations in the Surat Basin, where CSG activity is greatest, have estimated water table drawdown up to 85m (lessening away from the gas extraction areas), and periods up to 75 years for aquifer recovery after gas extraction ceases. A more widespread approach is recommended to reduce the level of uncertainty about the compounding effects of several CSG operations on regional groundwater flows and water availability. As far as excess production water is concerned, it could be made available for agricultural use where its quality is suitable, although it is commonly too salty for this.

The Queensland government has banned construction of evaporation ponds to treat this salty water so that disposal options are focussed on desalination, or reinjection into low quality aquifers. The New South Wales government has introduced an ‘Aquifer Interference Policy’ to address mining activities which would extract more than 3 ML of water a year, but the issue of disposal of production water is yet to be addressed.

Also of major concern to rural communities are the issues of access to agricultural land by mining companies, and their impact on land quality and usability. CSG extraction commonly requires a close grid of extraction wells, each with a 100 - 500m2 pad and a track and pipeline servicing it. These and other land use issues are presently being addressed bya Senate inquiry.

CSG development has the potential to transform the economies of Queensland and New South Wales. As with any major new industrial venture, the opportunity comes with significant environmental and societal challenges. Local, State and Federal governments, and the mining and petroleum industries, all have a role in developing arrangements in such

a way that this economic opportunity can be captured without compromising environmental and social values.

Image source: Victorian Depatment of Primary Industries

Posted by Stewart Needham at 11:09 AM

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Labels: coal seam gas, environment