The coal seam gas debate

Dr Alex St John, Science, Technology, Environment and Resources

Key issue 
Coal seam gas (CSG) is a polarising issue in some communities. Proponents argue that CSG is a vital energy resource, necessary for continued gas supply. Opponents claim that CSG could have serious environmental and social impacts.

What is CSG?

CSG is natural gas (methane) which is sourced from underground coal formations, sometimes known as coal bed methane (See Figure 1). CSG is increasingly being used to supply gas to eastern Australia.

In conventional gas fields, the gas exists in permeable sandstone reservoirs. CSG, however, is found in coal seams, where underground water pressure keeps it contained. Pumping water out of the coal seam releases this pressure and allows gas to escape from the coal into a well.

Figure 1: Different natural gas types

Well spacing: in conventional gas reservoirs, a single well can give a good flow rate, as the gas steadily migrates towards the well and then out.

Figure 1: Different natural gas types. Image source: Energy Information Administration.

However, it is harder for gas to move through coal seams towards a well. This means that with CSG, there needs to be more wells, closely spaced, to achieve a satisfactory flow, which in turn means more land is needed for CSG developments.

Water production: as water pressure in the coal seam must be reduced, some CSG wells produce large volumes of water (averaging 10,000 litres of water per day per well in Queensland). This water can contain salt and other contaminants that exist normally in coal seams in varying concentrations.

Need for stimulation and directional drilling: as gas moves through coal less freely than conventional sandstone reservoirs, CSG wells sometimes are stimulated by hydraulic fracturing to make the gas flow at an acceptable rate. Similarly, vertical gas wells can be supplemented by ‘lateral’ wells, which are drilled horizontally along the coal seam, often over a kilometre or more. This brings the well closer to the gas, reducing the number of vertical wells that need to be drilled.

Cost: CSG fields involve more infrastructure than conventional gas wells, so the cost to produce CSG is generally higher than conventional natural gas.

Why use CSG?

Existing conventional gas resources in the eastern states are limited (see brief on energy resources). Large conventional gas resources exist offshore from Western Australia, but these are not connected to the eastern market. Gas producers have turned to CSG to supply expanding demand and replace declining supplies from conventional gas fields. Proponents also point to a valuable export market from CSG, once liquefaction plants open at Gladstone in Queensland from late 2014.

What is the controversy?

CSG development has sparked concern from environmental, agricultural and community groups. Their concerns can be summarised as follows:

Water resource competition: de-watering coal seams during gas production withdraws water from subterranean aquifers, placing pressure on limited groundwater resources, which is of concern in agricultural areas in the Great Artesian Basin.

Land-use competition: CSG deposits in Australia are often co-located with prime agricultural land, such as the Liverpool Plains in New South Wales and the Darling Downs in Queensland. Academic and media reports suggest that in some cases there is conflict between agricultural activity and CSG development.

Community concerns: some communities feel that CSG development does not fit with the character or objectives of the area, such as wine or tourist regions. Some communities are also concerned that CSG development may have an impact on their health.

Possible environmental effects: environmental groups have raised concerns that CSG development might cause environmental damage through release of untreated production water at the surface; damage to, and contamination of underground aquifers by hydraulic fracturing; damage to wildlife habitat in sensitive areas and contamination of surface water resources in drinking water catchments.

What is the evidence?

Limited evidence is available on environmental and health impacts of CSG. International comparisons are difficult, due to limited overseas use of CSG and different local conditions.

Water usage: modelling undertaken by the former Queensland Water Commission suggested that CSG activities might affect a small proportion of agricultural aquifers in the Surat basin.

Environmental/aquifer damage: although some scientists have drawn correlations between certain environmental phenomena (such as gas bubbling into the Condamine River) and CSG activity, a causal link between the factors is not yet established. It is possible that these phenomena could also be caused by natural processes. A review by the New South Wales Chief Scientist into CSG has highlighted the need for ongoing research.

Health effects: some communities near CSG developments (such as Tara in Qld) have reported a range of non-specific symptoms, which they attribute to exposure to CSG activity. A state government investigation of the reports concluded that CSG could not be established as the cause of the reported symptoms, but some groups have criticised the investigation as superficial.

Current regulatory position

As CSG is an onshore gas resource, the regulation of its development is primarily the responsibility of the states and territories, although the National Partnership Agreement on Coal Seam Gas Development attempted to implement a national approach to assessing CSG developments.

The water trigger and the IESC

In 2013, the Australian Government amended the Environment Protection and Biodiversity Conservation Act 1999 to require CSG and large coal mining developments to obtain federal approval where they would have a ‘significant impact’ on water resources – the so-called ‘water trigger’. This approval is separate to state approvals and must take into account advice from the Independent Expert Scientific Committee on Coal Seam Gas and Large Coal Mining Development.

What about shale gas?

Although comparisons are sometimes drawn between CSG and the shale gas industry in the United States, there are substantial differences between the two and it is difficult to make direct comparisons. There is some speculation that shale gas development will start in Australia in the near future. However, it is likely that this will produce a different set of regulatory issues to CSG.

Further reading

M Roarty, The development of Australia’s coal seam gas resources, Background note, 2010-11, Parliamentary Library, Canberra, 28 July 2011.

For copyright reasons some linked items are only available to members of Parliament.

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