The NSW EDO said it would look “very closely” at the judgement to explore the options for appeal.
CSG opponents were driven into a frenzied Twitter storm, with accusations that laws were biased towards business and that the gas producer will destroy the Great Artesian Basin, among other things.
ICN sister publication Energy News drawing a link in last week’s story between the NSW court’s decision that Santos’ holding pond facility at Leewood was “properly characterised” as being part of petroleum exploration and thus permitted under the Mining Act, and chairman Peter Coates’ comment at the SA oiler’s latest AGM that it would not be “bullied” out of the Pilliga, seemed to be a trigger.’
Santos’ Leewood facility is part of its Narrabri CSG project located in the Pilliga State Forest in north-west NSW. Water extracted during our exploration and appraisal operations is transferred to the company’s Leewood facility located on a Santos-owned property about 25 kilometres south of Narrabri. At Leewood the water is stored in state of the art double-lined ponds.
The NSW government gave Santos approval to construct a water treatment facility at Leewood to allow the saline water to be treated by reverse osmosis and more than two thirds to be reused. Santos is proposing to use the treated water to irrigate a section of the Leewood property and for operational purposes.
Yet activists have used semantics over planning laws as an attempt to stall or preferably kill the project of Santos, the last major player left in the state, having managed to chase others like AGL Energy and Metgasco out of NSW, the latter of which has now found the more welcoming climes of the US Gulf of Mexico.
The prolific @PilligaPush was first off the mark with “@EnergyNewsAu @SantosLtd Bullied? AGL chose to exit Gloucester because the gas was not there to make it economical”
@PilligaPush followed that up with: “@EnergyNewsAu this is why AGL exited Gloucester! Unfortunately #CSG co’s like to throw the word ‘bully’ around!”
AGL copped a $375 million write down in the December 2015 quarter for its underperforming Moranbah CSG field in Queensland, wore $166 million for deciding to abandon its Gloucester project in NSW and will also terminate production from its Camden CSG project in that state by 2023, 12 years earlier than expected.
The company has since moved out of upstream oil and gas to start a renewable energy fund, increasing fears the move would exacerbate the gas shortage of NSW, which imports 95% of its natural gas.
The NSW government has deemed Santos’ Narrabri proposal a “strategic energy project” given its critical capacity to supply up to half the state’s gas needs.
AGL said $1 billion would be needed to develop Gloucester, a cost so big that the company was not confident of sufficient returns. Its PEL 285 permit has been returned to the state government.
Then came “rabble rouser”, aka @mrl58, with: “Flogging a dead #csg horse, let’s hope @SantosLtd realise before #Pilliga #water & Great Artesian Basin are destroyed @EnergyNewsAu.”
The CSG “horse” could be said to be dead in that the state has been buying back leases leaving Santos the last one standing.
However, given the state’s chronic gas needs and energy minister Anthony Roberts this week calling for “experts” to figure out a way forward to produce “clean, affordable and reliable” energy, it would appear gas is the best way to go given analysis from industry consultancy RISC says battery storage technology that would make renewables more reliable and competitive with coal and gas-fired generation is at least a decade away.
@CycloneCharlie8 followed up with “@EnergyNewsAu Won’t do @SantosLtd any good, $6.5 B debt and exporting #LNG at a loss. The Pilliga project is finished financially”
Santos did load up on debt for its $18.5 billion Gladstone LNG project which some analysts believe is running at a loss, but the company has maintained since before it went online last October that
GLNG is cash-flow positive at $US40/barrel and a foreign exchange rate of A80c/US dollar.
Overnight the Aussie dollar bought US76.4c, while Brent has not been under $40 since April 6 after the horror plunge in January that saw it dip to $30 amid a 12-year low.
During that horror month of January, JP Morgan that Santos would barely be breaking even.
Energy News understands that Santos needs to do more appraisal work and complete an Environmental Impact Study to the regulator before it gets a true idea of the size of the project which would then determine the cost, so Cyclone Charlie’s comments are presumptuous and, for activists, optimistic.
Heatherjane black also Tweeted with “@EnergyNewsAu @SantosLtd NO winders in the Pilliga. The air, soil, water, GAB and even Santos won’t win anything in the long run. ALL LOSE.”
Water expert Dr Richard Cresswell, principal hydrogeologist and Jacobs Engineering Group and the CSIRO’s former principal research scientist, said last September that Santos’ proposed Narrabri gas project would not impact the major recharge zones of the GAB.
“The main recharge areas in the region around Narrabri for the GAB are in the Warrumbungles to the south and from the Namoi River alluvium system to the north,” Dr Cresswell said.
“The area around where the gas project is, is in fact is a very low recharge area. The water in the GAB comes from rainfall falling on the recharge zones all around the margins.”
John Hampsire followed up with “@PilligaPush @CRAG_Coona @EnergyNewsAu @SantosLtd Yep: + this judgement highlights bias to biz in laws that govern L&E Court outcomes”
Even last Friday @PilligaPush was still at it, Tweeting: “… and look what happened with Rio Tinto at Bulga!”
Residents of NSW’s Hunter Valley town of Bulga withdrew their court appeal against Rio Tinto’s Warkworth mine expansion in May after more than six years of legal battles as the NSW EDO didn’t believe they would win.
