This comprehensive
report has been written by Sandi Keane
available in its full length at independentaustralia and presented at this
site in an abridged three parts.
This work is
licensed under a Creative
Commons Attribution-NonCommercial-NoDerivs 3.0 Australia License
RISING GAS
PRICES, the pitched battle over CSG between farmers and miners, the US threat
to LNG’s $13.2 billion export bonanza – are all
set to spill over into the Federal election campaign. The Greens and Bob Katter
are looking to capitalise.
The CSG
industry’s hope of rivalling Qatar as the world’s biggest exporter
of LNG could be snookered on a couple of fronts — the twin threat to
Australia’s competitiveness in the face of a glut of natural gas from the US
and the failure to overcome bitter resistance from farmers in key CSG
tenements.
Thanks to world-leading
extraction technology, oil and gas from the US’s massive shale reserves may see
it regain its former “energy super power” title according to the Annual
Energy Outlook for 2013.
After
weighing up the economic impact on the domestic market, the US Department of
Energy gave the green light on LNG exports to boost the flagging
US economy.
Having warned that US shale production could be a
game-changer two years ago, Deloittes now predicts U.S. LNG projects could displace
Australian exports due to a surge in costs of constructing local LNG plants, The
Australian reports.
Royal Dutch
Shell’s Australian Chair, Ann Pickard, also weighed in on the threat to Australia’s
competitiveness now that the US can deliver LNG to Tokyo Bay 20 per cent
cheaper than Australia.
A spokesman
for APPEA (the
Australian Petroleum Production and Exploration Association) declined
to comment when contacted by Independent Australia.
But the
viability of the future LNG market is also threatened on the domestic front as
farmers and (mostly) foreign-owned corporations go head to head in the
competition for Australia’s riches: the $13.2 billion LNG export bonanza on the one hand,
and Australia’s tightly-held food and fibre production regions on the other.
Both Arrow Energy
(now owned by Royal
Dutch Shell and PetroChina) and Santos Ltd (in partnership with Malaysian
Petronas and French Total) are planning huge LNG facilities at
Gladstone, Queensland.
So far,
getting access to their major CSG reserves to fulfil feedstock requirements is
proving a nightmare for the two energy giants
Delays due
to concerns about fracking, toxic chemicals, depletion of water and loss of
prime farmland are stalling progress and adding to costs.
The Liverpool
Plains’ Gunnedah Basin in New South Wales is a major CSG resource
for Santos. It is also one of Australia’s major cereal, oilseed and cotton
production regions. Its prized black vertisol soil delivers two crops a year,
even during droughts
Likewise, Arrow’s Queensland CSG reserves are mostly concentrated on the Darling Downs’fertile cropping lands, in particular, Cecil Plains — whereas Origin and QGC acreage sits further west on marginal or grazing country. Livestock can easily move around wells so getting graziers on board with the prospect of additional farm income is possible — not so cropping land with its 30-foot harvesters, ploughs and fragile soil.
Like the
Liverpool Plains, the black alluvial soil makes it one of the world’s most
valuable producers of cereals, oilseed and cotton.
These two
tightly held, iconic agricultural regions, along with the Hunter Valley, have
emerged as flashpoints in the hostilities.
Previous related discussion
Later published discussions
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