ABOUT COAL
SEAM GAS
What is Coal Seam Gas? CSG is natural gas; its petroleum makeup is about 95-99% pure methane which was formed millions of years ago as part of the burial of peat and the formation of coal. The gas is attached to the coal by the pressure of its burial and the hydrostatic head in its current state. It has been traditionally extracted from coal seams during mining operations where it is potentially explosive. Now CSG is a valuable energy source.
Why is it called unconventional gas? The word "unconventional" refers to the reservoir rock that contains the petroleum gas, not the petroleum source itself. For CSG, the reservoir rock is coal.
CSG extraction is not gas mining. This term is sometimes used but is not considered to have any real meaning as the gas is not mined but drilled and produced from CSG wells, just like wells drilled to conventional reservoirs. The "coal" in CSG is not mined but remains in place after CSG extraction.
What is LNG? LNG is an abbreviation for Liquefied Natural Gas. It is simply natural gas that is cooled to -162¡ and in doing so, shrinks 600 times from that of a vapour to a liquid.
The main reason to liquify gas is to allow for easy transportation over large distances.
PRODUCTION
METHODS
What is fraccing? It is a process of opening existing fractures and creating new ones in underground coal seams to increase the flow and recovery of gas from a well. It is also known as fracture stimulation, hydraulic fracturing, or hydrofraccing.
What are the frac fluids? The majority of frac fluids are a base fluid such as water or nitrogen and propping materials such as sand or ceramic beads. Other chemicals, which are fully Government registered and approved, are used in very low volumes. These chemicals allow the frac fluid to have special characteristics such as gelling properties, neutrality with underground rock, prevention of bacteria growth, and others. All these chemicals are safe when used as directed and are used in very low concentrations.
How is it done? Fraccing takes place hundreds of metres below ground within the coal seam. Each job is specifically designed to only impact on the target coal seam; aquifers are intentionally avoided. If a frac job begins to divert from its design, real time data during a job allows the plan to be modified or stopped.
Is fraccing safe? Fraccing has been ongoing for some 60 years with an excellent safety and environmental record. Fraccing is designed to avoid aquifers, as we aim to protect the aquifers that we depend on for water supplies. As a cost effective industry, we avoid unnecessary water production as this only increases costs. Fraccing only impacts on the coal seam itself, and it generally occurs deep underground and away from most of the commonly used acquifiers. As a result, the risk of groundwater contamination is minimal.
USE OF
CHEMICALS
What are BTEX chemicals? Benzene, toluene, ethylbenzene, and xylene are commonly known as BTEX. In pure form or high concentrations, all of these chemicals are hazardous; Benzene has the highest profile. All of these chemicals exist in everyday life in low and safe concentrations. They are part of petroleum products. They also are naturally occurring chemicals already in many coal seams, and possibly other ground waters. The most common sources of exposure to BTEX chemicals are from breathing contaminated air, particularly in areas of heavy motor vehicle traffic and petrol stations, and through cigarette smoke.
Were BTEX chemicals used in CSG fraccing in Queensland? In pure form or high concentrations, BTEX chemicals have not been used in CSG fraccing in Queensland. Some early frac fluids by various operators may have contained minor traces of BTEX, but even these frac fluids met USA drinking water standards. In 2010, the Industry further lowered the traces of BTEX in frac fluids to meet the Queensland Government's 2011 ban on BTEX which is now based on the more stringent Australian drinking water standards.
USES AND
REGULATION
OF CSG
How is CSG used for power? 15% (ABARE 2011) of Queensland's electricity supply is generated from CSG. As CSG is simply natural gas from an unconventional reservoir, it can be mixed with natural gas from conventional reservoirs and CSG from different fields. As a gas, it is piped directly to users. It can be used to fuel gas turbines for mine sites or for urban electricity generation; and it can direct fire furnaces. As a fuel substitute for petrol or diesel, CSG can also be converted to LNG, for ease of storage and transport, and to Compressed Natural Gas (CNG).
How is Blue Energy Limited regulated?In Queensland, the first petroleum regulations began in 1923. In 2004, the Petroleum and Gas Act underwent a major regulatory update. Each year since then, more regulations have been added and continue to be added. At present, the current number of regulations and conditions are estimated to total around 2,500. Environmental regulations are in addition to this. For Blue Energy's exploration tenements, our Level 2 Environmental Authorities have more than 100 conditions to which our activities must adhere.
Is the CSG industry regulated in Australia?In addition to the regulations described above, the Queensland CSG industry is subject to the most rigorous environmental approval and monitoring processes in the State's history. Potential LNG projects have to comply with around 1,200 State Government environmental approval conditions per project. Those projects which have so far received Australian Government approval have to comply with a further 300 federal environmental conditions.
CSG AND WATER
How is CSG water managed? The water extracted during CSG production must be handled in an environmentally sound manner. The quality of the water can vary from drinkable to saline, depending on several factors. The Queensland Government has stated that reinjection and substitution is the preferred water management strategy. Beneficial use is the next available option. Evaporation ponds and water course disposal are no longer options for development.
What about protection of aquifers? CSG does not come from the prolific aquifer sands, such as those key aquifers of the Great Artesian Basin. CSG reservoirs are limited in connectivity and have very low water recharge rates, if any. Otherwise, only water would be produced and no gas. A report from Geoscience Australia to the Australian Government recommends a precautionary approach but concludes the risk of impact to the clean aquifers of the Great Artesian Basin is minimal.
MORE
INFORMATION
Where can I get more information? Industry groups and the Queensland Government are publishing a number of fact sheets and information documents on the CSG industry. If you have more questions, please contact Blue Energy, visit our website , or the Queensland Government website or the Australian Petroleum Production and Exploration Association (APPEA).
Sources: Queensland Resources Council, Minerals and Energy Education; Queensland Government, Tomorrow's Queensland; APPEA, CSG Facts.