The Sydney-based company holds interests in several licences in eastern Australia, but its immediate focus is on proving up coal seam methane reserves in its 65%-held PEL 238 permit in NSW’s Gunnedah Basin.

This permit contains one of the largest onshore natural gas accumulations in Australia, totalling 17,000 petajoules (17 trillion cubic feet) of gas-in-place within the two coal seams that are over 10m thick in each of two coal-bearing formations, Casey said.

Located within this permit is the Bohena project area, which covers 265 square kilometres and contains up to 3700PJ (roughly 3.7Tcf) gas-in-place.

And it is here that Eastern Star has recently finished bringing the last of its Bibblewindi CSM pilot wells online.

“We’re getting pretty close to becoming another coal seam gas company with certified reserves,” Casey told the conference.

“And it’s not a matter of if, but when, it will happen. We’re slowly seeing increased rates of gas production at Bibblewindi – so it’s just a matter of time before we get over the threshold.”

Eastern Star plans to connect its Bibblewindi and Bohena production pilots to the Wilga Park power station, expanding it from an 11MW facility into a 40MW plant.

Casey said the company expected it would cost between $15 million and $20 million to increase its reserves from 200PJ to 600PJ.

Once reserves reach this level, the company would have satisfied the terms of a memorandum of understanding with Macquarie Generation on the potential supply of CSM gas to the Bayswater power station, located in the Hunter Valley, and it would be well placed to benefit from the state’s paucity of gas.

“New South Wales is a net importer of natural gas,” Casey said.

“There’s plenty of gas in Queensland but no direct pipeline network connecting the two states.

“So there’s clearly an opportunity for us – if we get our act together – to prove up our reserves and take advantage of this.

“In this regard, our market position is quite different from the Queensland [CSM] producers.”