Addressing the annual convention of the Australian Pipeline Industry Association (APIA) in Alice Springs, RLMS senior advisor Grahame Baker outlined the dramatic increase in gas transmission pipelines being constructed solely for the distribution of CSM.
“The development of coal seam gas in eastern Australia, and its recent acceptance in the market as being a reliable source of natural gas though from a different reservoir from conventional gas, has been a significant driver for new gas pipeline infrastructure since 2000,” he said.
“Putting it in context, in 2000, there was about 4500km of mainly gas transmission pipeline in Queensland – of which only 18km was solely dedicated to coal seam gas.
“The rapid growth in coal seam gas production since 2000 has seen another 1550km of main gas pipeline constructed of which 1200km (80%) have been driven by or built specifically for coal seam gas.
“A further 300km of new transmission lines to service coal seam gas is under construction while 470km is expected to receive project sanction by early 2007.”
In addition to the gas transmission lines and laterals, the CSM industry had installed over 2000km of gas-gathering lines and close to this amount of water gathering and disposal piping as part of the development of CSM fields, according to Baker.
“A further 1200km of gas transmission pipeline investment to meet the needs of the continuing growth in coal seam gas output expected by the end of 2008 is under detailed investigation,” he said.
PNG’s loss, CSM’s gain
While commercial production of CSM in Australia was only a decade old, over the past 10 years it become a significant part of the Eastern Australian upstream gas industry, particularly in Queensland.
Baker said the Queensland Government’s policy for 13% of power generated in the State to be gas-fired that came into effect from January 1 last year had been a major facilitator in the development of the CSM industry.
“The policy, which had a focus on the environmental effects of power generation was aimed, in part, at underwriting the proposed Papua New Guinea gas developments,” he said.
“With the ongoing delays with the PNG Gas Pipeline, coal seam gas has filled the bulk of the market opportunities that earlier would have been taken up by gas from PNG.
“Coal seam gas has firmly established itself in the eastern Australian gas market, filling the market supply gap as a result of declining reserves and production capabilities from conventional sources such as Cooper-Eromanga Basin, Denison Trough and the Surat Basin,” he said.
“It has provided strong gas-on-gas competition to the proposed PNG Gas Project and the current slippage by the PNG Gas Project is likely to see further inroads made by CSG into it becoming, within the next decade, the major source of natural gas to the eastern Australian market.”
By the middle of next year, CSM from the Bowen and Surat Basins will begin to enter other eastern Australian markets, according to Baker.
“This will involve coal seam gas flowing westwards from Wallumbilla to Ballera in Epic Energy’s 759km, 406mm pipeline [PPL 24] originally commissioned in 1998 to supply southeast and central Queensland with conventional sourced gas from Ballera in the Queensland section of the Cooper-Eromanga Basin,” he said.
Epic Energy has announced that front-end engineering and design has begun on the Ballera-Moomba Interconnect to enable supply of CSM to both Epic’s Moomba-Adelaide pipeline and Australian Pipeline Trust’s Moomba-Sydney pipeline.
Planning is for the proposed 180km Interconnect to be commissioned during 2008.
Australian Pipeline Trust is also undertaking detailed engineering of a pipeline from Ballera to the Omicron valve station on its Moomba-Sydney pipeline in far southwest Queensland. This approximate 180km line will facilitate the flow of CSM from central Queensland to New South Wales markets without the need to pass through or around the Moomba Hub, according to Baker.
