The fraught relationship between mining companies and landowners in rural Queensland took another blow with the mysterious discovery of an illegal poison in eight Origin Coal Seam Gas drilling wells about 350km west of Brisbane. The find of the banned toxic chemical BTEX last week comes just months after the Queensland Government ordered Cougar Energy to shut down its Underground Coal Gasification plant near Kingaroy when water tests detected similar compounds of benzene and toluene in groundwater monitoring bores.
CSG is a very different technology to the unproven UCG. However, the BTEX find puts a cloud over an industry that is about to take off in the mineral-rich Surat Basin energy province. On Friday Federal Environment Minister Tony Burke gave conditional approval to the GLNG (jointly owned by Santos, Petronas and Total) and BG plan to export $30 billion of CSG to Chinese markets via Liquefied Natural Gas plants in Gladstone in the coming 20 years. Neither company were directly affected by the BTEX find which occurred at eight Australia Pacific LNG (jointly owned by Origin and ConocoPhillips) coal seam gas sites in an area between Miles and Roma.
The industry has been on the defensive over the outbreak. APLNG is likely to be the next major CSG player to have its environmental impact assessment tested by government. Their Environmental Impact Assessment has been with the Queensland Coordinator General Colin Jensen since January this year. Jensen has been holding off his decision awaiting the Federal Government on GLNG and BG. Landholders in particular in coal seam gas areas have not been happy about the impacts to their land and water. Given that Burke imposed more than 300 strict conditions on GLNG and BG, it is likely the Origin/ConocoPhillips project will have to address these also.
The BTEX contamination is an added headache. The problem came to light last Tuesday when Origin released a statement to the ASX saying they had found traces of BTEX in fluid samples taken from eight exploration wells. They said they advised relevant landowners, Western Downs Regional council (but not apparently the Roma-based Maranoa Council which was also affected) and the Queensland government of the find. The company told Queensland Minister for Sustainability and Climate Change, Kate Jones there was no evidence of environmental harm or risk to landholder bores. However Jones has requested confirmatory testing by an independent service provider.
The finds come just days after the Queensland Government banned BTEX from all coal seam gas operations. Minister for Natural Resource Mines and Energy, Stephen Robertson told parliament BTEX petroleum compounds were not used in Queensland CSG operations but have been used in overseas oil and gas operations in the fraccing process. Fraccing is the controversial process that involves pumping fluid at high pressure into a coal seam to fracture the seam to allow gas to flow readily into gas wells. The Australian Petroleum Production and Exploration Association say chemicals make up less than 1 percent of fraccing fluid and the risk to public health at those levels was negligible.
Which is just as well, as BTEX is extremely toxic. As well as being a cancer-causing compound, there is a documented history of harmful effects on the central nervous system. Because of the solubility of the majority of the BTEX components they are also prone to leaching into the underground waterways polluting areas larger than the original contamination site.
BTEX gets its name from its make-up: petroleum compounds containing benzene, toluene, ethylbenzene and xylenes. They are aromatic hydrocarbons which occur naturally in crude oil at low levels. In the 1970s the oil industry invested so heavily in BTEX it comprised 35 percent of all US gasoline (petrol) by 1990. When the EPA found excessive benzene concentrations in city air, the culprit was identified as the aromatics. While the percentage was subsequently decreased, it still makes up a significant component of petroleum.
Origin say they have no idea how it was found at their wells last week but admit it may have been contained in lubricants used at the site. While its use in fraccing is illegal, they may be used on a drill bit which remains legal. APLNG's executive general manager of oil and gas, Paul Zealand told the Courier-Mail the traces were barely detectable, did not enter the water table and may be naturally occurring. "It is isolated from water courses and livestock," he said. "The company will undertake further testing in consultation with landholders in the coming days."