Example Generating hydrocarbons from coal in- situ (Coal Seam Methane, Underground Coal Gassification)

Potential in Queensland Wide potential application Leader in CSG development in Australia

CSG Basics Pump water to “depressurise” coal seam Lower pressure releases gas from the coal

“Fracturing” to increase permeability

Issues of Water Management The volume of water extracted with CSG is also highly variable between fields and wells. Production in the Bowen Basin results in the extraction of around gigalitres (GL) of water for every petajoule (PJ)2 of gas, whilst in the Surat Basin around 0.26GL of water is extracted for every PJ of gas. These figures are representative only and actual produced water volumes can vary significantly across individual sites. In , approximately 13.5 gigalitres (GL) of CSG water was produced in Queensland. Based on the continuation of the domestic CSG market, it is estimated that the Surat Basin will produce an annual average of 25 GL of CSG water for the next 25 years.

Underground Coal Gassification “Active” process – some form of reaction to generate gas

Challenges to the industry “Outrage at gas water contamination” “Contamination concerns shut pilot undergound gas project” “Coal gas developer sacks 20 staff after bore water contamination scare at Kingaroy”

Key issues Coal Seam Gas –Another “user” of water –Impact on existing users including the environment –Potentially subsidence Underground Coal Gassification –By-products of the underground process migrating into other “useable” resources

Management Process improvements to reduce water use (CSG) and USG by-products Use of managed aquifer recharge to re- inject the groundwater into the aquifers Improved geological analysis of coal seams to better contain any contaminant Improved monitoring and management plans