What is it about coal-seam gas?

The NSW elections returned the Coalition Government, which suffered a loss in votes and seats, but with 46 per cent of the vote to Labor’s 34 per cent, remained well ahead. The more hopeful Labor people say that they will be ‘in striking distance’ at the next elections in 2019, and indeed they well might be — it’s a long way off. The item that received most coverage on election night and thereafter, once the comfortable return of the Baird Government was clear, was the role of the coal-seam gas (CSG) controversy. It seems to have given the Greens three seats, and nearly provided a fourth. Two of them are in inner Sydney, Balmain and Newtown, while two are adjoining seats in northern NSW, Ballina and  Lismore; the last, on present indications will be a close win for the Nationals over the Greens.

It was clear to me that I knew much less than I ought about coal-seam gas, and set off to find out more. I am aware that there is a major coal seam underlying the whole of the Sydney metropolitan area, and indeed there is a lot of coal in eastern Australia, at varying depths. Much of the present mining is open-cut, the technology for which makes most underground coal-mining unviably expensive. Getting rid of coal-seam gas from underground mines was a basic problem in underground mining, because the gas is, of course, highly flammable.

The gas itself is methane, with other constituents that have to be extracted before the gas can be sent by pipelines to you and me. That kind of extraction applies to all sources of methane — the ‘conventional’ gas that is associated with oil, or by itself in gas reservoirs, and the ‘unconventional’ sources — shale gas (where the gas is lodged within shale rock), tight gas (where the gas is in hard rock, and requires hydraulic fracturing, or ‘frakking’, to be released), and coal-seam gas, where the gas is held within coal seams by water and pressure. All these gases are chemically much the same.

Coal-seam gas doesn’t come from those big open-cut holes in the ground, but from underground seams between 200 and 1200 metres below, so drilling, rather than clearing off the overburden, is necessary. The drilling may well pass through underground aquifers, and the extraction of the gas will also require more water, which will to some degree be affected by the whole process, and may in cases render it unfit for any human or agricultural purpose. The question of that water, both in the aquifers and what must be disposed of after the production of the gas, seems to be central to the ‘coal-seam gas issue’. But it is by no means the only important factor.

The Chief Scientist and Engineer of New South Wales was asked two years ago to provide the Government of the State with advice on ‘the current operation of CSG activities in NSW’, and delivered her interim report at the end of July 2013. It is a comprehensive and most interesting document, and anyone who want to find out about the issue will do well to read it. The final report came out in September last year. It consists of a summary, a list of recommendations, and a set of appendices. It too is clear and accessible.

The big picture is fascinating. CSG is not new: a colliery in Balmain in Sydney operated in the 1930s and during the war to produce it. Before that came ‘town gas’, which I remember well from Armidale in the 1950s, produced basically by distilling the gas from coal. Those local gas companies have gone. But natural gas is now a rapidly growing element in our energy sector (an 8 per cent increase in production in 2011-12 alone), fuelling power stations, heating our homes, cooking our food and serving in countless ways in industry and commerce. Moreover, it is a highly prized product internationally, where the price is a good deal higher than it is here. The gas we use in Canberra and in NSW comes from the Bass Strait, the Cooper Basin and Queensland. Whether you are opposed to it or not, about a third of the gas you use is CSG. Only about five per cent of the CSG comes from NSW, and all of that from one facility at Camden, south west of Sydney.

New South Wales does have large reserves, enough to supply the State for centuries. But they are largely untapped, because of worries about water and residue, on the one hand, and a regulatory system that greatly favours those who don’t want CSG wells in their backyards, on the other. There is a looming supply crisis. It seems that Victoria can’t supply any more than it is currently supplying, because of pipeline constraints. And in 2016 the formal agreements that provide gas to us come to an end. The new agreements will be much more expensive, meaning higher prices for everyone. Queensland and Western Australia are concentrating on the overseas market, not on the domestic, let alone on poor old NSW. If you were the NSW Government, you’d be wanting to exploit the State’s gas reserves as quickly as possible. Hence the request to the Chief Scientist to produce a report.

The Report says that the major political imperative is to provide really good data (of all kinds) that people can trust, and a regulatory system that provides certainty to those who are prepared to risk their money in the hope of finding exploitable gas. The public submissions to the enquiry (of which there were 233) emphasise concerns about ground water, health, the environment, and the use of chemicals and their consequences. An underlying theme was lack of trust in what the CSG companies and governments say. It is worth noting that within the Coalition, those who possess seats where coal-seam gas is an issue are not anxious for the Government to give a green light to CSG exploitation. The Greens have been given a lovely stick with which to thump both major parties.

Altogether, it’s am intriguing political mix. Why are ordinary people so concerned? I’ll pass on the citizens of Balmain and Newtown, where there cannot be serious concerns about CSG in the local environment, and one looks to more general explanations about why the Greens are doing well in inner-city seats. The Report has some thoughtful pieces about public concern. A document commissioned by the Chief Scientist suggested that the film Gasland, which is about frakking for tight gas and oil, not coal-seam gas, and very much from the opponents’ perspective, ‘is unduly shaping the coal seam gas debate and heavily influencing Australia’. Having not seen it myself, I can’t comment. But the authors of that report go on to say:

What a muddle. Oh, and everyone on the Green side seems to have forgotten that gas is a much smaller producer of carbon dioxide than coal. You wonder sometimes what exactly it is that they want. The final Report of the Chief Scientist gives a cautious go-ahead, but we have not by any means heard the end of this issue, and I wish Mr Baird and his Government every success in persuading the citizens of NSW that there really is a problem with the supply of gas to NSW people, that it won’t go away, and that exploiting CSG can be done, responsibly.

Footnote: I take this opportunity to recommend an excellent 20-minute interview of the 91-year-old Freeman Dyson, physicist and mathematician. There’s nothing in it about CSG, but his wit, gentleness and perspicacity are a model for those who like to talk about global warming and ‘climate change’. You can view it here.