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CSG in Victoria

CSG in Victoria. Geoff Collins Manager Energy Resources Development and Engagement. Presentation Overview: Context What is CSG How is it produced Hydraulic fracturing Water Access to land Prospectivity - how likely is CSG to eventuate Questions. Context

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CSG in Victoria

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  1. CSG in Victoria Geoff Collins Manager Energy Resources Development and Engagement

  2. Presentation Overview: • Context • What is CSG • How is it produced • Hydraulic fracturing • Water • Access to land • Prospectivity - how likely is CSG to eventuate • Questions

  3. Context • Victoria’s gas demand will have doubled by 2030 • Current gas reserves will be depleted somewhere between 2025 and 2030 • There are three possible sources of local supply which need to be investigated: • conventional gas offshore • shale gas and tight gas onshore • coal seam gas onshore Sources: AEMO Gas Statement of Opportunities DPI Annual Statistical Review

  4. What is CSG? CSG is methane, the principal component of natural gas. It is formed by: CSG is largely held on the surface of the coal. The greater the hydraulic pressure, the more gas that can be stored. • temperature as coal is buried (black coals) • biogenic activity in coal (brown coals)

  5. How is it produced? • To produce CSG, pressure must be reduced to allow the methane to come off the coal surface • Methane flows through natural fractures to a collecting well where it is brought to surface • Depth is in the range of 200 to 1000 metres • Drill rigs are truck mounted and occupy a space of about 60 by 80 metres • Well spacing is of the order of 500 to 700 metres • A producing well occupies a space of about 10 by 10 metres

  6. Hydraulic fracturing • Hydraulic fracturing or fraccing is used to enhance permeability where natural fractures are insufficient to allow gas to flow to the well • Fraccing uses a fluid that is 98% water and sand. Wells are cased to contain the fracturing to the coal seam and to isolate shallower aquifers • Victorian regulations mean any proposal for the use of additives in hydraulic fracturing requires detailed assessment For a list of chemicals that might be used in fraccing fluids: www.appea.com.au

  7. Water - sub-surface • Including • lowering of (non-coal) aquifer pressures • connection between aquifers • natural connection • connection caused by fraccing • fraccing fluids • Water extraction requires licensing by SRW

  8. Water - surface • Disposal of water • disposal to land is exempt under EPA licensing • disposal to an aquifer requires EPA licensing • disposal to a waterway requires EPA licensing

  9. Access to land • Victoria wants to see both development of its earth resources and a thriving farming sector. • The area that a CSG operation occupies means that farming activities can continue • While there is no right of veto, the MRSDA puts requirements on companies that want to access land and provides a general requirement to consult

  10. Prospectivity - how likely is it to eventuate? • Most of the world’s CSG is coming from black coal • Victoria largely has brown coal or disseminated black coal. Around Wonthaggi there are some thicker black coal seams but their extent is limited • There is little information about the characteristics of Victoria’s coal from which to draw conclusions • What evidence there is, is inconclusive.

  11. Where Victorian brown coal is located

  12. Questions?

  13. Gippsland Basin Coal Tertiary Brown Coal Cretaceous Black Coal

  14. Otway Basin Coal

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