CSG water - Hidden wellspring ...

Excerpt from The Australian:

Hidden wellspring

15 May 2008

Coal seam gas used to be a deadly and explosive hazard for coalminers.

But more recently it has become a valuable resource that is being tapped by Australia's booming east coast gas suppliers.

Mining coal below 300m-400m is an expensive exercise, but the gas trapped by water in deeper seams is mainly methane, which produces about half the greenhouse gas emissions as coal.

As the technology to extract and use this gas has improved and the world has become more carbon-conscious, coal seam gas has become economically viable as an energy source. The gas is turned into liquefied natural gas and used locally.

The bid by British-based BG group (formerly British Gas) for Queensland's Origin Energy drew attention to the large and lucrative reserves of coal seam gas and its export potential. Extracting the gas also yields a useful by-product: water.

To extract the gas, miners first have to extract the usually brackish water that was once regarded as a waste product and was typically left to evaporate in huge ponds.

But the long drought in southeast Queensland, at the southern end of the gas-rich Surat Basin, has led to miners and local communities reassessing the value of this water.

Queensland Gas Company's managing director Richard Cottee says that plans to export millions of tonnes of LNG mean there will be vast quantities of water that can be used "for the benefit of the nation in some shape or form, whether it is for the supply of water to Toowoomba or (for use in) coalmines, or whatever".

Within a decade, Queensland Gas will be producing 100 megalitres, or 100 million litres, of water a day at its gas field near Condamine in southeast Queensland.

There are already plans for Queensland Gas to supply water to the nearby township of Miles. Cottee points out that the gas field is only 200km from Toowoomba, one of the cities worst affected by the Australian drought. There is even talk of coal seam water being used in Brisbane. The Queensland capital is on level-six water restrictions, which limits residents to 140 litres a day. Its dams are down to 37.42 per cent and have not been full since January 2000.

The estimated cost of a pipeline from the gas field to Toowoomba is $300 million. Toowoomba's dam is at 11.5 per cent capacity.
...

Toowoomba needs water sooner than Queensland Gas will be able to produce it. Besides, there are problems with supplying coal seam water.

One hurdle is that so far there is no regulatory framework for treating coal seam water for urban use. But Queensland Premier Anna Bligh is open-minded. "We certainly will not reject water from any reliable source," she says. "If this water can be treated effectively and transported efficiently, I would like to get this as drinking water to regional towns and Toowoomba."

Bligh has promised to fast-track the necessary regulatory framework to enable towns to use coal seam water.

"These towns have done it tough," she says. "They've suffered severe drought, population decline. If we get the water out there, particularly as a by-product of another industry, then we can breathe life back into the bush in southeast Queensland."

It could also turn out to be a reliable source of water for irrigation, cattle feedlots and industrial uses, including power stations.

CSIRO Petroleum Resources' Luke Connell says the volume and quality of water yielded by the production of coal seam methane vary from one site to another.

"Some areas can produce a lot of water and other areas may not produce much water at all," he says. "It really depends on the local groundwater quality, whether that water is immediately suitable for further use. It could be potable (drinking quality) water, but often (in) Australian fields it can be quite saline."

Large-scale production of coal seam gas took off only during the past decade, he says. "They were focused initially on trying to understand how much gas they could produce. Water has become more important as the industry has grown and they have seen how much water is being produced.'

Paul Zealand, general manager of exploration and production for the largest coal seam gas producer, Origin Energy, says the company produces 5000ML of water a year. That is estimated to increase to 25,000ML by 2015.

Origin has been using a treatment facility for the water since late last year. "We are committed to finding a beneficial use for that water," Zealand says. "At the moment, it's a beneficial use to put it back into the natural environment. What we ultimately want to do is find a more beneficial use and get a return for it if we can. What we don't want to do is over-hype what we are doing. It may well help certain parts of rural Queensland, but it's not that big."

Former deputy prime minister John Anderson, who is chairman of NSW-based minnow Eastern Star Gas, plays down the drought-breaking potential of coal seam gas production. It may be sufficient to help supply some towns or augment some supplies, but volumes that can make a big difference are unlikely, Anderson says.

"It will not be without its use, but it will not be that significant," he says. "The amount of water likely to be produced and the location mean (it may be of some use) from time to time. There's no doubt we could use it, but no one should be thinking it's the sort of quantity that's going to support drought relief."

Arrow Energy has been producing 10ML to 12ML of water a day at its operation west of Toowoomba. Environmental manager Ralph Gunness says for the past 18 months Arrow has been supplying 4ML a day to local cattle feedlots. The water is slightly brackish, containing 4000 to 6000 parts per million of salt. Sea water is about 35,000ppm, cattle can tolerate water up to 8000 ppm, water for plants generally needs to be less than 1000ppm and the acceptable level for human consumption is 500ppm.

The next step for Arrow is to pipe the water 20km to Dalby, where it will be desalinated for the town's 11,500 population. But piping water is not cheap. Gunness says Arrow is spending $4 million on the pipe and associated pumping costs.

"We are giving the water to the council free, which will allow them to have economies of scale, to desalinate the water and put it to good use," he says. It is part of a $19 million project, which includes funding from the commonwealth, state and local governments.

"We just signed off a $1.5 million expenditure on a mini RO (reverse osmosis) plant," Gunness says. "We are doing a demonstration irrigation trial, to demonstrate to the local farmers that this water is OK."

The water can also be used for washing coal and Arrow is exploring the possibility of using it for saltwater fish farming.

Another challenge is that the water is heavy: one cubic metre weighs one tonne and pumping it through a pipeline uses up a great deal of energy.

The volume of water produced by a coal seam gas project is highest at the beginning of the project but quickly tails off. Most projects have a useful life of less than 40 years.

Desalination is expensive and, again, uses up lots of energy; besides, the waste water it produces contains a high concentration of salts and needs to be disposed of safely.

There also are fears the water in the coal seams can be linked to other ground sources, so its extraction may be depleting a larger water source.

Cottee, an unabashed enthusiast for using what until recently was problem waste water, says the coal bed where Queensland Gas will be extracting water and gas is not linked to any other groundwater system.

"We are simply saying, look at this water, it is a scarce resource and a fantastic opportunity for Queensland," he says.

Coal's other treasures on tap

Methane gas has been forming as part of the process of peat becoming coal for millions of years.

Coal has natural microscopic fractures, called cleats, that enable it to hold large volumes of gas. It is held in place by pressure and by billions of litres of water locked up in coal seams.

The water and gas are not separate to the coal: all three are bound together. When a well is drilled into a coal seam, gas does not usually rise to the surface. But when water is pumped from the well, the pressure is reduced and the gas flows.

Water production is typically greatest in the early phases of mining and, as water production decreases, gas flow increases.

The quality of the water varies between gas fields. It depends on the depth of the coal seam, the relationship of the seam to aquifers or groundwater, the permeability and porosity of the coal seam, and the efficiency of the well extraction process.

The gas can be liquefied to form liquid natural gas.

Most of Australia's coal seam gas comes from the Bowen and Surat basins. There is more water associated with coal seam gas in the Surat Basin than in the Bowen Basin.

A gas power station emits less than half the carbon dioxide of a coal-fired power station, and also generates less CO2 where it is mined than conventional natural gas.

The Queensland Government has mandated 18 per cent of the state's energy to come from gas by 2020, up from 13 per cent.

According to the Queensland Department of Mines, last financial year 9419ML (megalitres or million litres) of water was produced from coal seam gas fields. Brisbane used a total of 119,000 ML in that period. Coal seam water is expected to increase to 14,300ML by 2010.

See - The Australian - Hidden wellspring.