www.northernstar.com.au
5 Nov 2012
RESIDENTS of 25 roads from the five suburbs in the south of the Clarence Valley have declared their communities CSG-free. In a ceremony yesterday at the Kungala/Lanitza RFS Hall, declarations for the roads were handed to Clarence Valley Councillor Sue Hughes. Each declaration said the road was protected by the "will of the community". The event was the end of a long processs of surveying 432 residents (over the age of 16) in Lanitza, Kungala, Braunstone, Wells Crossing and Halfway Creek with the simple question-"Do you want your roads and lands CSG Free?".
CSG-Free Community co-ordinator (Clarence LGA) Lynette Eggins said eight residents said no, six were unsure but 95.6% stated they did not want gas fields in their community. "The CSG Free Communities Strategy is a grassroots democracy process", said Ms Eggins. "The NSW government has failed to protect farmers and communities from invasive gas fields. Now these communities have decided to take charge of their own destiny.
"These declarations are strong statements from the people, declaring their intent to defend their community from an invasive and reckless industry, an industry that poses risks to water, land values, farming land and the health of families".
In accepting the declarations from representatives of individual roads, Cr Hughes said it was fantastic to see the community becoming so active in the fight against CSG. "You don't want it here and I don't want it here. We want our water to be safe from toxins and chemicals".
Cr Hughes said she would table the declarations at CVC's December meeting. Ewingar, in the Upper Clarence, declared itself CSG-free earlier this year. Cr Richie Williamson accepted the declaration at a ceremony in Lismore. "Across the Northern Rivers, communities are running with this grass-roots process", said Annie Kia from Lock the Gate Alliance Northern Rivers, who was instrumental in developing the initiative early this year.
"So far, a total of 11,590 people have responded to the survey in more than 60 communities. "Of these, 96% said yes to wanting their road and community gas-field free. Astonishingly, only 1% said no to going Gasfield Free, with 3% not sure. "This is about self-determination. Communities have a right to protect existing industries, their land, water and health".
Showing posts with label CSG. Show all posts
Showing posts with label CSG. Show all posts
Thursday, 15 November 2012
Wednesday, 4 April 2012
Gas could be just as dirty as coal, study reveals
www.smh.com.au
28 Mar 2012
Coal seam gas, widely touted as a greener fuel than coal, could have just as deep a carbon footprint unless world-class standards are used when extracting the gas from the ground, an expert report has found.
A study into the life-cycle greenhouse emissions of Australia's energy sources by consultancy WorleyParsons found conventional gas from large offshore wells typically produced 38% less greenhouse emissions than black coal, largely because it burnt more cleanly.
But the equation could shift dramatically for the fledgling coal seam gas industry-the subject of a fierce political battle in NSW and Queensland-if meticulous standards were not followed when the gas was extracted from the ground.
So-called ''fugitive emissions'', particularly of methane, which is a much more powerful greenhouse gas than CO₂, can tip the balance and make coal seam gas as dirty a fuel source as black coal burnt in ageing power plants, the report says.
''If methane leakage approaches the elevated levels recently reported in some US gas fields,.. the [greenhouse gas] intensity of CSG,.. generation is on a par with sub-critical coal-fired generation,'' the report states.
The lead author, Paul Hardisty, said in a statement: ''The implications for regulators and the emerging Australian CSG industry are that best practice applied to design, construction and operation of projects can significantly reduce emissions, lower financial liabilities under the carbon tax, and help make CSG a less GHG-intensive fuel option.''
More…
28 Mar 2012
Coal seam gas, widely touted as a greener fuel than coal, could have just as deep a carbon footprint unless world-class standards are used when extracting the gas from the ground, an expert report has found.
A study into the life-cycle greenhouse emissions of Australia's energy sources by consultancy WorleyParsons found conventional gas from large offshore wells typically produced 38% less greenhouse emissions than black coal, largely because it burnt more cleanly.
But the equation could shift dramatically for the fledgling coal seam gas industry-the subject of a fierce political battle in NSW and Queensland-if meticulous standards were not followed when the gas was extracted from the ground.
So-called ''fugitive emissions'', particularly of methane, which is a much more powerful greenhouse gas than CO₂, can tip the balance and make coal seam gas as dirty a fuel source as black coal burnt in ageing power plants, the report says.
''If methane leakage approaches the elevated levels recently reported in some US gas fields,.. the [greenhouse gas] intensity of CSG,.. generation is on a par with sub-critical coal-fired generation,'' the report states.
The lead author, Paul Hardisty, said in a statement: ''The implications for regulators and the emerging Australian CSG industry are that best practice applied to design, construction and operation of projects can significantly reduce emissions, lower financial liabilities under the carbon tax, and help make CSG a less GHG-intensive fuel option.''
More…
Tuesday, 31 January 2012
Solar guru receives Australia Day honour
www.abc.net.au
26 Jan 2012
Australia needs to look to Germany if it is to realise the potential of solar cell technology, says an expert who is being honoured today. Professor Martin Green of the University of New South Wales has been made a Member of the Order of Australia (AM) for his work on photovoltaics. "Germany has been the only country that's had a sensible long-term program in place to promote the use of renewables", says Green.
Some argue solar cells are not a competitive option for reducing carbon emissions, and are limited by the fact that they don't generate energy unless the Sun is shining. But according to Green, the "stars are aligning for conventional roof mounted solar" and it is ripe for a new kick start from governments.
Cheaper technology
Green says the cost of solar cells has come down rapidly in recent years largely due to the expanding manufacturing industry in China. "They're now a third to a quarter of the costs of only a couple of years ago", he says. "It's expected that this [decline in price] will continue over the next decade. The projections are that about 60% further will be taken off the costs over that period".
The German experience Green says the advantage of solar cells is they produce most of their energy in the day when energy use is at its highest. While clouds can cut back solar power production, this can be compensated for by energy from other areas that are sunny-as long as the grid covers a large enough geographic area, he says. Green points to data from Germany where nearly one million (mainly rooftop) solar panels supply the equivalent of a dozen nuclear power plants, or about 40% of the maximum demand in Australia. "When you average across the whole country you get a very predictable daily output", he says.
Balancing generation and use
Green says matching the generation of energy with its use is an old issue that the grid has found ways of accommodating. "You just slightly change perspective when you are generating most of your power during the day time [as you would with a system involving photovoltaics]", he says. Green says current day coal and nuclear power stations push out energy all night, when it's not particularly needed. As a result there is a need to store excess energy produced at night or for incentives to encourage energy use during this time.
"We give away electricity to aluminium smelters at night just to provide a load for the power plants at night", says Green. He says in countries like Japan, Germany and the US, excess energy from conventional power plants is currently used to pump water uphill at night for hydroelectricity. Generation of excess energy from photovoltaic cells during the day could be dealt with in a similar way, says Green. Local storage of energy from photovoltaics in batteries is also starting to occur, he says.
Feed-in tariffs
Green says Australian state-based schemes to promote rooftop solar have been undermined by fixed feed-in tariffs. Instead, a sliding tariff scale of the kind used in Germany, which progressively reduces subsidies to solar power and drives down the cost of solar panels, is more sustainable. "The German scheme has been undoubtedly successful", says Green.
"It has single-handedly driven the world market for both wind and solar products and changed the industry from non-viable to the state it is now where it has the chance of being self-sustaining". He says a carbon tax in Australia will only encourage lowest-cost present day low-emission alternatives. The tax should be complemented by German-style schemes to boost photovoltaics, which are presently at a low stage of development but have the potential to lower costs in the future.
Efficiency and sustainability
Green's research team currently holds the record for highly efficient solar cell technology, which has been commercialised through CSG Solar Pty Ltd, of which he is research director. Green says current silicon cells show 25% efficiency in the lab, although commercially available panels operate at just 14 to 15%. His team is working with several companies to improve this efficiency.
He says the thermodynamic limit of converting sunlight into electricity is 74%, and at this point, the best lab device reaches 36% using cells made from exotic materials. Green says the energy being used to make solar cells is also reducing. "Everything that is being done to reduce the cost of the cells also reduces the energy content", he says.
And he says the industry is moving away from the use of toxic chemicals that require expensive disposal, with pollution from solar cell production becoming the exception. "Of the hundreds of manufacturers in China there have been two of them in the last five years that have been found to be not disposing of the wastes of the processing of the silicon for the cells in an acceptable way".
26 Jan 2012
Australia needs to look to Germany if it is to realise the potential of solar cell technology, says an expert who is being honoured today. Professor Martin Green of the University of New South Wales has been made a Member of the Order of Australia (AM) for his work on photovoltaics. "Germany has been the only country that's had a sensible long-term program in place to promote the use of renewables", says Green.Some argue solar cells are not a competitive option for reducing carbon emissions, and are limited by the fact that they don't generate energy unless the Sun is shining. But according to Green, the "stars are aligning for conventional roof mounted solar" and it is ripe for a new kick start from governments.
Cheaper technology
Green says the cost of solar cells has come down rapidly in recent years largely due to the expanding manufacturing industry in China. "They're now a third to a quarter of the costs of only a couple of years ago", he says. "It's expected that this [decline in price] will continue over the next decade. The projections are that about 60% further will be taken off the costs over that period".
The German experience Green says the advantage of solar cells is they produce most of their energy in the day when energy use is at its highest. While clouds can cut back solar power production, this can be compensated for by energy from other areas that are sunny-as long as the grid covers a large enough geographic area, he says. Green points to data from Germany where nearly one million (mainly rooftop) solar panels supply the equivalent of a dozen nuclear power plants, or about 40% of the maximum demand in Australia. "When you average across the whole country you get a very predictable daily output", he says.
Balancing generation and use
Green says matching the generation of energy with its use is an old issue that the grid has found ways of accommodating. "You just slightly change perspective when you are generating most of your power during the day time [as you would with a system involving photovoltaics]", he says. Green says current day coal and nuclear power stations push out energy all night, when it's not particularly needed. As a result there is a need to store excess energy produced at night or for incentives to encourage energy use during this time.
"We give away electricity to aluminium smelters at night just to provide a load for the power plants at night", says Green. He says in countries like Japan, Germany and the US, excess energy from conventional power plants is currently used to pump water uphill at night for hydroelectricity. Generation of excess energy from photovoltaic cells during the day could be dealt with in a similar way, says Green. Local storage of energy from photovoltaics in batteries is also starting to occur, he says.
Feed-in tariffs
Green says Australian state-based schemes to promote rooftop solar have been undermined by fixed feed-in tariffs. Instead, a sliding tariff scale of the kind used in Germany, which progressively reduces subsidies to solar power and drives down the cost of solar panels, is more sustainable. "The German scheme has been undoubtedly successful", says Green.
"It has single-handedly driven the world market for both wind and solar products and changed the industry from non-viable to the state it is now where it has the chance of being self-sustaining". He says a carbon tax in Australia will only encourage lowest-cost present day low-emission alternatives. The tax should be complemented by German-style schemes to boost photovoltaics, which are presently at a low stage of development but have the potential to lower costs in the future.
Efficiency and sustainability
Green's research team currently holds the record for highly efficient solar cell technology, which has been commercialised through CSG Solar Pty Ltd, of which he is research director. Green says current silicon cells show 25% efficiency in the lab, although commercially available panels operate at just 14 to 15%. His team is working with several companies to improve this efficiency.
He says the thermodynamic limit of converting sunlight into electricity is 74%, and at this point, the best lab device reaches 36% using cells made from exotic materials. Green says the energy being used to make solar cells is also reducing. "Everything that is being done to reduce the cost of the cells also reduces the energy content", he says.
And he says the industry is moving away from the use of toxic chemicals that require expensive disposal, with pollution from solar cell production becoming the exception. "Of the hundreds of manufacturers in China there have been two of them in the last five years that have been found to be not disposing of the wastes of the processing of the silicon for the cells in an acceptable way".
Thursday, 1 December 2011
Coal seam gas may not help climate fight
www.smh.com.au
19 Nov 2011
The federal Minister for Energy, Martin Ferguson, is often criticised but he's right about this: the coal seam gas industry has grown too fast. We have not done our homework before issuing approvals for this $50 billion-plus export industry-on the possible groundwater and land-use impact, on what to do with the millions of tonnes of salt left over, or the impact on Gladstone harbour and the Great Barrier Reef. Crucially, we have rushed to develop coal seam gas reserves as a cleaner alternative to coal, assuming it will help reduce greenhouse gas emissions and tackle climate change. But will coal seam gas reduce emissions? By how much? We don't actually know.
Recent research into fugitive emissions, including peer-reviewed articles by Cornell University's Robert Howarth and the US National Centre for Atmospheric Research's Tom Wigley, both published in Climate Change Letters, have found unconventional plays like coal seam gas or shale gas may deliver no greenhouse benefit at all, or even make things worse.
If that turns out to be right, gas may be an obstacle rather than a bridge to a decarbonised future. With the International Energy Agency warning this month that the energy infrastructure we build over the next five years will determine whether the world is able to limit global warming to 2°, it's hard to think of a more critical climate policy question-or one with more money riding on it. Early this year the oil and gas industry lobby group, the Australian Petroleum Production & Exploration Association (APPEA), commissioned research by engineering consultancy WorleyParsons on the life cycle emissions of coal seam gas versus coal when exported and burned in China.
APPEA did something strange. It only released the executive summary. Why? Because, according to some of its members, there were scenarios which showed how coal seam gas might emit more greenhouse gasses than coal. At worst, if burned in the least efficient ''peaking'' open-cycle turbines, coal seam gas was up to 44% dirtier than the newest, most efficient coal-fired plant. Some inside Worley-and the better coal seam gas companies, too-were unhappy with the association's handling of the report. There was pressure to get it out. The executive director of the think tank Beyond Zero Emissions, Matthew Wright, got wind of the industry disquiet and had an idea: commission a separate study by Worley-in fact, widen its scope-and get the results into the public domain that way. A contract was drawn up and a price agreed: $50,000. Wright believes the work was done and the report drafted. Somewhere, things went off the rails.
Cold feet at Worley, perhaps? All week, starting in Monday's Age and on ABC Radio National's Breakfast program and running from there, the accusations have flown thick and fast. Worley says it and Beyond Zero mutually agreed to drop the contract, no fee being payable. Instead, the same research would be published in a peer-reviewed journal, Energies. Wright flatly denies he ever agreed to that-he still wants the report he commissioned-and claims Worley is suppressing the report to stay on side with the coal seam gas industry which gives it contracts worth hundreds of millions of dollars. Worley rejects that outright and says everything Beyond Zero commissioned-''the full box and dice'', a spokesman told me-will be in the Energies paper. How, asks Wright, when his report had a broader scope than the Australian Petroleum Production & Exploration Association's 80-odd page document, and what peer-reviewed journal would publish all that? As it happened, a fortnight ago APPEA did finally release its own full, original report by Worley. Some media took APPEA's line, saying it proved gas was cleaner; others focused on the previously unreleased information, including less flattering gas-versus-coal scenarios. It's now online.
On Tuesday the Merrill Lynch oil and gas analyst David Heard weighed in with a six-page note to clients titled: ''Green gas debate: who is hiding the fugitives?'' It pulls the APPEA report apart. For a start, the report assumes coal seam gas/liquefied natural gas projects apply best practice in greenhouse gas and environmental management, especially to prevention of venting and leaks in upstream operations. Extreme scenarios for coal seam gas venting and leakage were excluded. Extreme was defined to mean ''other than best practice''. But Heard records his personal observation of a Santos drilling operation in the Cooper Basin (not a coal seam gas well, as it happens) where after fracking and in the flow-back phase ''the well vents a mixture of fracking fluid and gas direct to atmosphere in an unconstrained manner for days''. Heard's colleagues in the US have found likewise.
Then Heard noted how our National Greenhouse and Energy Reporting System (NGERS) allowed the coal seam gas companies to rely on a 2004 US industry-derived document, the American Petroleum Institute's Compendium of Greenhouse Gas Emissions Methodologies for the Oil and Gas Industry, which explicitly stated it was ''neither a standard nor a recommended practice for the development of emissions inventories''. The compendium contains generic assumptions, Heard noted, which may be outdated given the rapid development of unconventional gas extraction, and inapplicable in an Australian context.
APPEA's report admits, on page eight, ''the large-scale CSG/LNG industry in Queensland is new and emissions are only projections subject to high uncertainties in some areas''. Under our emissions trading scheme, carbon price liability is determined according to the emissions reported under NGERS system, including fugitive emissions. Ferguson says leave it to the market, guided by the carbon price. But relying on the Compendium could lead companies to understate emissions and ignore any carbon price signal. If, for example, the coal seam gas companies just use a rule of thumb-a broad average at the end of the year by some junior accountant asked to 'multiply the number of wells we've drilled by a number in a 2004 US document'-there is no price signal.
We need better science on the emissions from coal seam gas and, ultimately, Heard's note backs Wright, expressing concern at the alleged suppression of Worley's report for Beyond Zero, and concluding such a thorough independent expert assessment of full life-cycle emissions would be worthwhile. This week Ferguson ruled out the government commissioning any such report. A spokesman for the Climate Change Minister, Greg Combet, conceded the NGERS probably relied on an estimation approach to emissions from coal seam gas extraction, but said the system allowed for annual updating of estimation methods as new science came in. Lastly, Heard's note criticises APPEA's assumption that gas substitutes for inefficient coal in baseload generation in China. This may not be correct, he writes, ''gas is not really competing with coal at all''.
Heard's concern, on his clients' behalf, is not so much that the coal seam gas companies could face higher-than-expected carbon price liabilities if we had a truer picture of emissions. Rather, it's that amid an increasingly nasty debate on the roll-out of coal seam gas in Queensland and NSW, and given these projects are on thin ice politically as they push east coast gas prices higher by linking us to international markets, the last thing the industry needs is to lose the one thing it had going for it: an apparent benefit in tackling climate change. The gas projects are counting on expansion, to build second and subsequent liquefaction ''trains'', and approvals may prove harder to come by. If the greenhouse benefit claims turn out to be false, it's bad news for the coal seam gas companies.
paddy.manning@fairfaxmedia.com.au
Twitter: @gpaddymanning
19 Nov 2011
The federal Minister for Energy, Martin Ferguson, is often criticised but he's right about this: the coal seam gas industry has grown too fast. We have not done our homework before issuing approvals for this $50 billion-plus export industry-on the possible groundwater and land-use impact, on what to do with the millions of tonnes of salt left over, or the impact on Gladstone harbour and the Great Barrier Reef. Crucially, we have rushed to develop coal seam gas reserves as a cleaner alternative to coal, assuming it will help reduce greenhouse gas emissions and tackle climate change. But will coal seam gas reduce emissions? By how much? We don't actually know.
Recent research into fugitive emissions, including peer-reviewed articles by Cornell University's Robert Howarth and the US National Centre for Atmospheric Research's Tom Wigley, both published in Climate Change Letters, have found unconventional plays like coal seam gas or shale gas may deliver no greenhouse benefit at all, or even make things worse.
If that turns out to be right, gas may be an obstacle rather than a bridge to a decarbonised future. With the International Energy Agency warning this month that the energy infrastructure we build over the next five years will determine whether the world is able to limit global warming to 2°, it's hard to think of a more critical climate policy question-or one with more money riding on it. Early this year the oil and gas industry lobby group, the Australian Petroleum Production & Exploration Association (APPEA), commissioned research by engineering consultancy WorleyParsons on the life cycle emissions of coal seam gas versus coal when exported and burned in China.
APPEA did something strange. It only released the executive summary. Why? Because, according to some of its members, there were scenarios which showed how coal seam gas might emit more greenhouse gasses than coal. At worst, if burned in the least efficient ''peaking'' open-cycle turbines, coal seam gas was up to 44% dirtier than the newest, most efficient coal-fired plant. Some inside Worley-and the better coal seam gas companies, too-were unhappy with the association's handling of the report. There was pressure to get it out. The executive director of the think tank Beyond Zero Emissions, Matthew Wright, got wind of the industry disquiet and had an idea: commission a separate study by Worley-in fact, widen its scope-and get the results into the public domain that way. A contract was drawn up and a price agreed: $50,000. Wright believes the work was done and the report drafted. Somewhere, things went off the rails.
Cold feet at Worley, perhaps? All week, starting in Monday's Age and on ABC Radio National's Breakfast program and running from there, the accusations have flown thick and fast. Worley says it and Beyond Zero mutually agreed to drop the contract, no fee being payable. Instead, the same research would be published in a peer-reviewed journal, Energies. Wright flatly denies he ever agreed to that-he still wants the report he commissioned-and claims Worley is suppressing the report to stay on side with the coal seam gas industry which gives it contracts worth hundreds of millions of dollars. Worley rejects that outright and says everything Beyond Zero commissioned-''the full box and dice'', a spokesman told me-will be in the Energies paper. How, asks Wright, when his report had a broader scope than the Australian Petroleum Production & Exploration Association's 80-odd page document, and what peer-reviewed journal would publish all that? As it happened, a fortnight ago APPEA did finally release its own full, original report by Worley. Some media took APPEA's line, saying it proved gas was cleaner; others focused on the previously unreleased information, including less flattering gas-versus-coal scenarios. It's now online.
On Tuesday the Merrill Lynch oil and gas analyst David Heard weighed in with a six-page note to clients titled: ''Green gas debate: who is hiding the fugitives?'' It pulls the APPEA report apart. For a start, the report assumes coal seam gas/liquefied natural gas projects apply best practice in greenhouse gas and environmental management, especially to prevention of venting and leaks in upstream operations. Extreme scenarios for coal seam gas venting and leakage were excluded. Extreme was defined to mean ''other than best practice''. But Heard records his personal observation of a Santos drilling operation in the Cooper Basin (not a coal seam gas well, as it happens) where after fracking and in the flow-back phase ''the well vents a mixture of fracking fluid and gas direct to atmosphere in an unconstrained manner for days''. Heard's colleagues in the US have found likewise.
Then Heard noted how our National Greenhouse and Energy Reporting System (NGERS) allowed the coal seam gas companies to rely on a 2004 US industry-derived document, the American Petroleum Institute's Compendium of Greenhouse Gas Emissions Methodologies for the Oil and Gas Industry, which explicitly stated it was ''neither a standard nor a recommended practice for the development of emissions inventories''. The compendium contains generic assumptions, Heard noted, which may be outdated given the rapid development of unconventional gas extraction, and inapplicable in an Australian context.
APPEA's report admits, on page eight, ''the large-scale CSG/LNG industry in Queensland is new and emissions are only projections subject to high uncertainties in some areas''. Under our emissions trading scheme, carbon price liability is determined according to the emissions reported under NGERS system, including fugitive emissions. Ferguson says leave it to the market, guided by the carbon price. But relying on the Compendium could lead companies to understate emissions and ignore any carbon price signal. If, for example, the coal seam gas companies just use a rule of thumb-a broad average at the end of the year by some junior accountant asked to 'multiply the number of wells we've drilled by a number in a 2004 US document'-there is no price signal.
We need better science on the emissions from coal seam gas and, ultimately, Heard's note backs Wright, expressing concern at the alleged suppression of Worley's report for Beyond Zero, and concluding such a thorough independent expert assessment of full life-cycle emissions would be worthwhile. This week Ferguson ruled out the government commissioning any such report. A spokesman for the Climate Change Minister, Greg Combet, conceded the NGERS probably relied on an estimation approach to emissions from coal seam gas extraction, but said the system allowed for annual updating of estimation methods as new science came in. Lastly, Heard's note criticises APPEA's assumption that gas substitutes for inefficient coal in baseload generation in China. This may not be correct, he writes, ''gas is not really competing with coal at all''.
Heard's concern, on his clients' behalf, is not so much that the coal seam gas companies could face higher-than-expected carbon price liabilities if we had a truer picture of emissions. Rather, it's that amid an increasingly nasty debate on the roll-out of coal seam gas in Queensland and NSW, and given these projects are on thin ice politically as they push east coast gas prices higher by linking us to international markets, the last thing the industry needs is to lose the one thing it had going for it: an apparent benefit in tackling climate change. The gas projects are counting on expansion, to build second and subsequent liquefaction ''trains'', and approvals may prove harder to come by. If the greenhouse benefit claims turn out to be false, it's bad news for the coal seam gas companies.
paddy.manning@fairfaxmedia.com.au
Twitter: @gpaddymanning
Monday, 29 August 2011
Seam gas: CEO still uncertain
Age
19 August 2011, Page: 8
ONE of Australia's top energy chiefs has conceded that there is still significant uncertainty about emissions from coal seam gas, as controversy continues to plague the fledgling industry. The concession by Origin Energy CEO Grant King came amid disputed claims over carbon emissions released by CSG, and as a gas conference in Sydney was marred by protests.
Greens MPs have challenged the conventional wisdom that gas gives off about half as much greenhouse gas as coal when burned for fuel. They claim the release of "fugitive" emissions under coal seam gas extraction renders gas almost as polluting as coal once the "full life cycle" is considered.
Mr King said there was no doubt that conventional gas was less polluting than coal, but conceded that evidence about the pollution rates from CSG was "less readily available". "This is in part because interest in the issue has only arisen recently and in part because actual results will vary according to specific plant and equipment being used by different owners and operators along the supply chain", he said.
Woodside Petroleum chief executive Peter Coleman said he was yet to see a business case that could lure the Perth company into alternative forms of gas such as CSG. But after years working in the US for Exxon-Mobil, Mr Coleman said he had noticed that communities were less hostile to alternative forms of gas when landowners shared in the rewards. WA Premier Colin Barnett has suggested that close to half Australia's power needs should be generated by gas, but Mr Coleman said that was unlikely to happen until the domestic market was willing to pay as much for gas as export markets were.
19 August 2011, Page: 8
ONE of Australia's top energy chiefs has conceded that there is still significant uncertainty about emissions from coal seam gas, as controversy continues to plague the fledgling industry. The concession by Origin Energy CEO Grant King came amid disputed claims over carbon emissions released by CSG, and as a gas conference in Sydney was marred by protests.
Greens MPs have challenged the conventional wisdom that gas gives off about half as much greenhouse gas as coal when burned for fuel. They claim the release of "fugitive" emissions under coal seam gas extraction renders gas almost as polluting as coal once the "full life cycle" is considered.
Mr King said there was no doubt that conventional gas was less polluting than coal, but conceded that evidence about the pollution rates from CSG was "less readily available". "This is in part because interest in the issue has only arisen recently and in part because actual results will vary according to specific plant and equipment being used by different owners and operators along the supply chain", he said.
Woodside Petroleum chief executive Peter Coleman said he was yet to see a business case that could lure the Perth company into alternative forms of gas such as CSG. But after years working in the US for Exxon-Mobil, Mr Coleman said he had noticed that communities were less hostile to alternative forms of gas when landowners shared in the rewards. WA Premier Colin Barnett has suggested that close to half Australia's power needs should be generated by gas, but Mr Coleman said that was unlikely to happen until the domestic market was willing to pay as much for gas as export markets were.
Thursday, 18 August 2011
Court invokes coals to Newcastle rule
Age
11 August 2011, Page: 5
A VISTA of gas rigs dotted along the coast from Sydney to Newcastle was never going to be a winner with New South Wales coastal councils. And in a rebuff to energy explorers keen to push new techniques and test mining legislation it has not been a winner with government. Federal Resources and Energy Minister Martin Ferguson and his former Labor state counterpart, Steve Whan, have refused to grant offshore exploration licences to underground coal gasification proponent Energie Future.
The ministerial rejection came to light in documents before the Federal Court, where Energie Future is seeking judicial review of the decision by the ministers, who were acting as the joint authority under the Offshore Minerals Act. In 2008, Energie Future applied for four lease exploration areas, covering 6000 km². The boundary comes as close as five kilometres to the coast.
NSW refused the application last October and in November Mr Ferguson agreed. One of the grounds cited by the joint authority was concern about the effect on flora and fauna on the ocean floor and the "fragile beach environments". As recently as June, Gosford, Wyong, Lake Macquarie, Newcastle and Port Stephens councils wrote to the state government, opposing offshore mining in the permit area. They asked what contingency plans the companies had to deal with an oil spill or gas leak, and also queried the effect on the annual whale migrations.
Underground coal gasification (UCG) is a new technology in which coal is burnt and converted to a synthesised (or non-natural) gas underground. The method is used to access coal resources that are either uneconomic or inaccessible to work by conventional means. It is a different process to coal seam gas (CSG) extraction, which is experiencing strong community and some political opposition. It involves drawing water from the coal seam gass to release primarily naturally occurring methane gas.
The joint authority concluded: "The work program was inadequate, the application area is in conflict with [the existing] petroleum exploration permit 11, and the understanding that synthetic manufacture of syngas using underground coal gasification methods is not encompassed by the Offshore Minerals Act nor the Offshore Petroleum and Greenhouse Gas Storage Act 2006".
Its key point of refusal was that the "in situ production of a synthetic gas was not classified as a naturally occurring substance", and the extraction method proposed was not covered under the legislation. "It would be irresponsible to grant an exploration licence that would be unable to proceed to a mining licence under the legislative framework", it said. Energie Future has argued the joint authority made an error in law, and also denied the company natural justice. It says it is not a precondition to the granting of a mining licence that the licence holder recover a "mineral". It also says the authority did not consider its proposed alternative method of mining coal through boreholes.
11 August 2011, Page: 5
A VISTA of gas rigs dotted along the coast from Sydney to Newcastle was never going to be a winner with New South Wales coastal councils. And in a rebuff to energy explorers keen to push new techniques and test mining legislation it has not been a winner with government. Federal Resources and Energy Minister Martin Ferguson and his former Labor state counterpart, Steve Whan, have refused to grant offshore exploration licences to underground coal gasification proponent Energie Future.
The ministerial rejection came to light in documents before the Federal Court, where Energie Future is seeking judicial review of the decision by the ministers, who were acting as the joint authority under the Offshore Minerals Act. In 2008, Energie Future applied for four lease exploration areas, covering 6000 km². The boundary comes as close as five kilometres to the coast.
NSW refused the application last October and in November Mr Ferguson agreed. One of the grounds cited by the joint authority was concern about the effect on flora and fauna on the ocean floor and the "fragile beach environments". As recently as June, Gosford, Wyong, Lake Macquarie, Newcastle and Port Stephens councils wrote to the state government, opposing offshore mining in the permit area. They asked what contingency plans the companies had to deal with an oil spill or gas leak, and also queried the effect on the annual whale migrations.
Underground coal gasification (UCG) is a new technology in which coal is burnt and converted to a synthesised (or non-natural) gas underground. The method is used to access coal resources that are either uneconomic or inaccessible to work by conventional means. It is a different process to coal seam gas (CSG) extraction, which is experiencing strong community and some political opposition. It involves drawing water from the coal seam gass to release primarily naturally occurring methane gas.
The joint authority concluded: "The work program was inadequate, the application area is in conflict with [the existing] petroleum exploration permit 11, and the understanding that synthetic manufacture of syngas using underground coal gasification methods is not encompassed by the Offshore Minerals Act nor the Offshore Petroleum and Greenhouse Gas Storage Act 2006".
Its key point of refusal was that the "in situ production of a synthetic gas was not classified as a naturally occurring substance", and the extraction method proposed was not covered under the legislation. "It would be irresponsible to grant an exploration licence that would be unable to proceed to a mining licence under the legislative framework", it said. Energie Future has argued the joint authority made an error in law, and also denied the company natural justice. It says it is not a precondition to the granting of a mining licence that the licence holder recover a "mineral". It also says the authority did not consider its proposed alternative method of mining coal through boreholes.
Sunday, 24 July 2011
Farmers 'at mercy' of CSG companies
news.smh.com.au
July 20, 2011
Farmers are at the mercy of giant mining companies and feel helpless, a Senate inquiry into the coal seam gas industry has been told. Farmers have been forced to become gas and legal experts as they fight to protect their land and water, the Queensland Farmers Federation told the inquiry on Wednesday. QFF chief executive officer Dan Galligan said there'd been no research on the impact the burgeoning CSG industry would have on water bores.
Yet the industry was racing ahead. "The horse has bolted", Mr Galligan told the hearing in Brisbane. "It has bolted out of the paddock and we are all wondering who is going to shut the gate. "Many farmers, like us, feel disempowered". He said there were major concerns about the effects of the industry on groundwater, and no one was sure what would happen with the tonnes of salty water drawn from coal seam gass.
Senator Bill Heffernan said he believed CSG companies had a "cowboy attitude". "We have seen truckloads of stuff dumped on the road with no regard for anyone", he said. "A lot of farmers think money is going to stop the problems but I haven't come upon anyone from CSIRO who understands the water implications. "And no amount of money is going to compensate (for any damage).
The inquiry held hearings in Roma and Dalby earlier this week. Mr Galligan said there must be meaningful consultation between farmers and mining companies. "At the moment there is very little say (given to) the landholder", he told the hearing. He said farmers accepted the CSG industry contributed to local economies. "The issue is not to never have gas, but how can we have it without destroying our farming land", he said. "No environmental impact statement looks at food production". He said the state government was more interested in mining royalties.
July 20, 2011
Farmers are at the mercy of giant mining companies and feel helpless, a Senate inquiry into the coal seam gas industry has been told. Farmers have been forced to become gas and legal experts as they fight to protect their land and water, the Queensland Farmers Federation told the inquiry on Wednesday. QFF chief executive officer Dan Galligan said there'd been no research on the impact the burgeoning CSG industry would have on water bores.
Yet the industry was racing ahead. "The horse has bolted", Mr Galligan told the hearing in Brisbane. "It has bolted out of the paddock and we are all wondering who is going to shut the gate. "Many farmers, like us, feel disempowered". He said there were major concerns about the effects of the industry on groundwater, and no one was sure what would happen with the tonnes of salty water drawn from coal seam gass.
Senator Bill Heffernan said he believed CSG companies had a "cowboy attitude". "We have seen truckloads of stuff dumped on the road with no regard for anyone", he said. "A lot of farmers think money is going to stop the problems but I haven't come upon anyone from CSIRO who understands the water implications. "And no amount of money is going to compensate (for any damage).
The inquiry held hearings in Roma and Dalby earlier this week. Mr Galligan said there must be meaningful consultation between farmers and mining companies. "At the moment there is very little say (given to) the landholder", he told the hearing. He said farmers accepted the CSG industry contributed to local economies. "The issue is not to never have gas, but how can we have it without destroying our farming land", he said. "No environmental impact statement looks at food production". He said the state government was more interested in mining royalties.
Monday, 11 July 2011
The politics of clean energy
Summaries - Australian Financial ReviewI
6 July 2011, Page: 53
Although Australia is respected for its scientific research, the country's ability to successfully commercialise inventions is seen as weak. Solar voltaic technology that was developed at the University of New South Wales has been commercialised three times by BP, CSG Solar and Suntech Power, all overseas. While there are companies such as Silex Systems, which is building a solar power station locally and has developed laser technologies being used overseas in partnership with GE, that have Federal Government support, there is a consensus that Australia's support for commercialisation is poor.
GeoDynamics says the 'massive structural changes' needed for the successful implementation of technologies such as its geothermal power require changed policy frameworks, while the Australian Coal Association's Ralph Hillman says a carbon price will not be sufficient to drive the commercialisation of new technologies. Companies such as the Australian Securities Exchange listed AlgaeTec avoid government assistance due to intrusive bureaucracy, while Canberra's Dyesol has had to go to overseas companies Tata Power Steel and Pilkington Glass to help produce its technologies.
The Government's climate adviser, Ross Garnaut, says Australia's alternative energy R&D and commercialisation policies are poor, with the Australian National Audit Office finding that the 13 low emissions funding schemes often have spent little of their funding. Garnaut has proposed the creation of a Low Emissions Innovation Council to co ordinate efforts. Resource Minister Martin Ferguson, in recent comments to a Committee for the Economic Development of Australia, said the government was supporting renewable energy technologies.
Elsewhere, the CSIRO is spending funds on its 'energy transformed' project that includes building management systems that help to cut power usage, while GE has a partnership with electric vehicle group Better Place, as well as a partnership with EV Engineering that is helping develop an all electric GM GM Holden Commodore, which GE's Custom Fleet business could help.
6 July 2011, Page: 53
Although Australia is respected for its scientific research, the country's ability to successfully commercialise inventions is seen as weak. Solar voltaic technology that was developed at the University of New South Wales has been commercialised three times by BP, CSG Solar and Suntech Power, all overseas. While there are companies such as Silex Systems, which is building a solar power station locally and has developed laser technologies being used overseas in partnership with GE, that have Federal Government support, there is a consensus that Australia's support for commercialisation is poor.
GeoDynamics says the 'massive structural changes' needed for the successful implementation of technologies such as its geothermal power require changed policy frameworks, while the Australian Coal Association's Ralph Hillman says a carbon price will not be sufficient to drive the commercialisation of new technologies. Companies such as the Australian Securities Exchange listed AlgaeTec avoid government assistance due to intrusive bureaucracy, while Canberra's Dyesol has had to go to overseas companies Tata Power Steel and Pilkington Glass to help produce its technologies.
The Government's climate adviser, Ross Garnaut, says Australia's alternative energy R&D and commercialisation policies are poor, with the Australian National Audit Office finding that the 13 low emissions funding schemes often have spent little of their funding. Garnaut has proposed the creation of a Low Emissions Innovation Council to co ordinate efforts. Resource Minister Martin Ferguson, in recent comments to a Committee for the Economic Development of Australia, said the government was supporting renewable energy technologies.
Elsewhere, the CSIRO is spending funds on its 'energy transformed' project that includes building management systems that help to cut power usage, while GE has a partnership with electric vehicle group Better Place, as well as a partnership with EV Engineering that is helping develop an all electric GM GM Holden Commodore, which GE's Custom Fleet business could help.
Friday, 21 January 2011
Santos green-lights $16b CSG project
Courier Mail
14 January 2011, Page: 28
ABOUT $31 billion of investment is to be unleashed in Queensland after Santos and its partners yesterday announced the go-ahead for a $US16 billion ($A16.2 billion) coal seam gas development, the second of the controversial projects to be approved.
Adelaide-based oil and gas explorer Santos, which owns 30% of the Gladstone LNG (GLNG) project, and offshore partners Petronas, Total and Kogas, said the decision to proceed meant orders would immediately be placed for pipes, compressors and LNG plant components. Up to 1500 jobs are expected to be created between now and June.
Last October, UK-based BG Group became the first to give final investment clearance to a major project to convert coal seam gas from the Surat and Bowen Basins into LNG for Asian and domestic energy markets at processing plants at Gladstone. Its Queensland Curtis LNG project, to be operated by BG Group unit QGC, involves $US15 billion spent on two LNG processing lines or trains and wells, field facilities and pipelines.
BG Group expects first LNG exports from 2014. Santos's schedule sees first shipments from its two-train project in 2015. Santos chief executive David Knox said he didn't expect any impacts on the project from Queensland's flood disaster. "We're confident we will achieve first gas in 2015. We've got sufficient flexibility in our schedule. We will gradually ramp up this year in terms of staff numbers. Our peak employment isn't until 2013", Mr Knox said.
State and federal environmental approvals granted last year had cleared the way for the GLNG and QCLNG partners to take their final investment decisions. The environmental approvals came despite calls from agricultural industries, water management groups and environmentalists for a comprehensive scientific analysis of water impacts from CSG mining to be conducted.
The National Water Commission last month issued a major report on CSG mining risks in areas such as the Surat Basin, which is part of the Murray-Darling Basin and lies above the Great Artesian Basin. National Water Commissioner Chloe Munro said the CSG industry "risks significant, long-term and adverse impacts on surface and groundwater systems". She stressed that the potential impacts of CSG projects over a significant time period "are not well understood".
CSG mining involves bringing saline underground water to the surface in order to release trapped gas, and there are fears that water networks will be depleted or contaminated. The NWC raised major concerns with water practices proposed by CSG miners and issued recommendations for state and federal governments, including that CSG miners obtain licences for any water extracted.
The NWC said the CSG industry could extract 7500 gigalitres of water from groundwater systems over 25 years, or about,300GL a year. Currently, Australia's total extraction from the Great Artesian Basin is about 540GL a year Mr Knox said that he was not aware of the NWC recommendations.
New England MP Tony Windsor has said he will use his balance of power position in Federal Parliament this year to force CSG miners to conduct assessments of long-term, regional impacts of their controversial practices, either before exploration licences are granted or if necessary before mining proceeds. Santos shares closed up 2.2%, or 29¢, at $13.45.
14 January 2011, Page: 28
Adelaide-based oil and gas explorer Santos, which owns 30% of the Gladstone LNG (GLNG) project, and offshore partners Petronas, Total and Kogas, said the decision to proceed meant orders would immediately be placed for pipes, compressors and LNG plant components. Up to 1500 jobs are expected to be created between now and June.
Last October, UK-based BG Group became the first to give final investment clearance to a major project to convert coal seam gas from the Surat and Bowen Basins into LNG for Asian and domestic energy markets at processing plants at Gladstone. Its Queensland Curtis LNG project, to be operated by BG Group unit QGC, involves $US15 billion spent on two LNG processing lines or trains and wells, field facilities and pipelines.
BG Group expects first LNG exports from 2014. Santos's schedule sees first shipments from its two-train project in 2015. Santos chief executive David Knox said he didn't expect any impacts on the project from Queensland's flood disaster. "We're confident we will achieve first gas in 2015. We've got sufficient flexibility in our schedule. We will gradually ramp up this year in terms of staff numbers. Our peak employment isn't until 2013", Mr Knox said.
State and federal environmental approvals granted last year had cleared the way for the GLNG and QCLNG partners to take their final investment decisions. The environmental approvals came despite calls from agricultural industries, water management groups and environmentalists for a comprehensive scientific analysis of water impacts from CSG mining to be conducted.
The National Water Commission last month issued a major report on CSG mining risks in areas such as the Surat Basin, which is part of the Murray-Darling Basin and lies above the Great Artesian Basin. National Water Commissioner Chloe Munro said the CSG industry "risks significant, long-term and adverse impacts on surface and groundwater systems". She stressed that the potential impacts of CSG projects over a significant time period "are not well understood".
CSG mining involves bringing saline underground water to the surface in order to release trapped gas, and there are fears that water networks will be depleted or contaminated. The NWC raised major concerns with water practices proposed by CSG miners and issued recommendations for state and federal governments, including that CSG miners obtain licences for any water extracted.
The NWC said the CSG industry could extract 7500 gigalitres of water from groundwater systems over 25 years, or about,300GL a year. Currently, Australia's total extraction from the Great Artesian Basin is about 540GL a year Mr Knox said that he was not aware of the NWC recommendations.
New England MP Tony Windsor has said he will use his balance of power position in Federal Parliament this year to force CSG miners to conduct assessments of long-term, regional impacts of their controversial practices, either before exploration licences are granted or if necessary before mining proceeds. Santos shares closed up 2.2%, or 29¢, at $13.45.
Wednesday, 10 June 2009
Coal seam water a big challenge
Courier Mail
Tuesday 9/6/2009 Page: 56
QUEENSLAND'S coal seam gas industry, seen as a key energy and economic source for the state, is being asked how it will deal with the Sydney Harbour-sized amount of potentially hazardous water it could produce each five years. Agricultural businesses, fearing damage to waterways and crop land, have been seeking an end to coal seam gas companies' main practice of leaving untreated in large pools the highly salty, poor quality water displaced during CSG extraction.
The Queensland Government has begun to respond to those concerns with a ruling last month that coal seam water was an environmental hazard for which safe disposal was needed "There are significant ecological risks associated with disposal of (CSG water) and, without treatment, the Government believes the beneficial uses of CSG water are limited," a Queensland infrastructure and planning department discussion paper said in May.
In a 2006-07 report, members of the Independent Audit Group for Salinity appointed to review progress on implementing the Murray-Darling Basin Salinity Management Strategy asked Queensland to assess the salinity and chemical risks from coal seam water to land, groundwater systems, vegetation and surface water in the Condamine-Balonne catchments.
Nevertheless, 12.5 billion litres of coal seam water was produced in Queensland in 2007 and most went into evaporation ponds that range in size from one to 100 hectares. The Government's May discussion paper said there were "generally widespread concerns about evaporation ponds and the long-term legacy associated with salt stored in them".
It said disposal of an annual volume of 100 billion litres of coal seam water based on some estimates of the potential size of a liquefied natural gas industry using CSG in evaporation ponds would require a 100sq km area within 15-30 years. Sydney Harbour contains about 500 billion litres of water.
The Queensland and federal governments are encouraging the development of coal seam gas for export and for domestic gas fired electricity sources that would emit less greenhouse gases than coalfired facilites. But in March the Australian Academy of Technological Sciences and Engineering called for the Federal Government to find out and discuss with the public the best ways to power homes and businesses when impacts on human health, crops, biodiversity and the climate are quantified and included in the costs of the different sources of electricity generation.
The Queensland Government has now suggested the CSG industry co-operates to develop and fund a CSG water aggregation and disposal system to deal with coal seam water in the Bowen and Surat basins in central and southern Queensland. CSG Producer Queensland Gas Company spokesman Hedley Thomas said it was investigating the options for dealing with its coal seam water in an "acceptable, sustainable manner" and couldn't yet give cost estimates.
Santos spokesman Matthew Doman said it was spending an initial $50 million to use coal seam water on forestry projects, a method it says should take care of most of the water it produces. Rural lobby group AgForce said it was a given that coal seam water must be treated but there were also issues with treated water.
"You can create a new environmental set of conditions by putting unusually large amounts of water in an existing waterway so there are still some issues with that," AgForce president John Cotter said. "The Government's move to look at this in a strategic way is good. Evaporation ponds and the sludge they produce have been a key concern for agricultural producers and local communities. "We've seen mine overflows from disused mines, so there's all sorts of issues with this water sitting there and the last thing you want is that overflow getting into the Condamine Basin." he said.
Tuesday 9/6/2009 Page: 56
QUEENSLAND'S coal seam gas industry, seen as a key energy and economic source for the state, is being asked how it will deal with the Sydney Harbour-sized amount of potentially hazardous water it could produce each five years. Agricultural businesses, fearing damage to waterways and crop land, have been seeking an end to coal seam gas companies' main practice of leaving untreated in large pools the highly salty, poor quality water displaced during CSG extraction.The Queensland Government has begun to respond to those concerns with a ruling last month that coal seam water was an environmental hazard for which safe disposal was needed "There are significant ecological risks associated with disposal of (CSG water) and, without treatment, the Government believes the beneficial uses of CSG water are limited," a Queensland infrastructure and planning department discussion paper said in May.
In a 2006-07 report, members of the Independent Audit Group for Salinity appointed to review progress on implementing the Murray-Darling Basin Salinity Management Strategy asked Queensland to assess the salinity and chemical risks from coal seam water to land, groundwater systems, vegetation and surface water in the Condamine-Balonne catchments.
Nevertheless, 12.5 billion litres of coal seam water was produced in Queensland in 2007 and most went into evaporation ponds that range in size from one to 100 hectares. The Government's May discussion paper said there were "generally widespread concerns about evaporation ponds and the long-term legacy associated with salt stored in them".
It said disposal of an annual volume of 100 billion litres of coal seam water based on some estimates of the potential size of a liquefied natural gas industry using CSG in evaporation ponds would require a 100sq km area within 15-30 years. Sydney Harbour contains about 500 billion litres of water.
The Queensland and federal governments are encouraging the development of coal seam gas for export and for domestic gas fired electricity sources that would emit less greenhouse gases than coalfired facilites. But in March the Australian Academy of Technological Sciences and Engineering called for the Federal Government to find out and discuss with the public the best ways to power homes and businesses when impacts on human health, crops, biodiversity and the climate are quantified and included in the costs of the different sources of electricity generation.
The Queensland Government has now suggested the CSG industry co-operates to develop and fund a CSG water aggregation and disposal system to deal with coal seam water in the Bowen and Surat basins in central and southern Queensland. CSG Producer Queensland Gas Company spokesman Hedley Thomas said it was investigating the options for dealing with its coal seam water in an "acceptable, sustainable manner" and couldn't yet give cost estimates.
Santos spokesman Matthew Doman said it was spending an initial $50 million to use coal seam water on forestry projects, a method it says should take care of most of the water it produces. Rural lobby group AgForce said it was a given that coal seam water must be treated but there were also issues with treated water.
"You can create a new environmental set of conditions by putting unusually large amounts of water in an existing waterway so there are still some issues with that," AgForce president John Cotter said. "The Government's move to look at this in a strategic way is good. Evaporation ponds and the sludge they produce have been a key concern for agricultural producers and local communities. "We've seen mine overflows from disused mines, so there's all sorts of issues with this water sitting there and the last thing you want is that overflow getting into the Condamine Basin." he said.
Monday, 17 November 2008
No-brainer for QGC to accept BG's bra
Courier Mail
Saturday 1/11/2008 Page: 68
THE rise and rise of Queensland Gas peaked this week as it fetched the biggest takeover bid in Queensland corporate history. British energy giant BG Group offered $5.75 a share in cash which valued QGC, which listed just eight years ago, at $5.6 billion. The bid cruised past Queensland's previous acquisition record set in 2003 when Swiss miner Xstrata bought MIM Holdings for $4.93 billion.
The offer price was far from QGC's record closing high price of $6.22, set in May. But amid the carnage on global stockmarkets, the offer is still an alluring 80 per cent premium on QGC's battered share price of $3.20 before the deal was announced. And QGC's directors wasted no time in urging shareholders to cash in quick on the healthy value being put on the potential seen for its vast coal seam gas resources as a feedstock for liquefied natural gas to feed thirsty Asian energy markets.
The process of converting CSG into LNG is far from mature and as costs have spiralled, and debt markets and sharemarkets have wilted as funding sources for cash hungry project developers, accepting BG Group's offer is a no-brainer for QGC. Explaining QGC's enthusiasm for BG Group's offer, QGC chief executive Richard Cottee said spiralling corporate funding costs due to the global credit crunch had increased QGC's weighted average cost of capital (WACC).
"Clearly the world has changed in the last eight weeks and it is important in capitalism to adapt to those changes," he told investors and journalists during a conference call. "Our WACC got whacked ... an 80 per cent premium is none too shabby in this market." BG Group's offer formally closes on December 15 but it said yesterday its QGC stake was now 43.9 per cent. Analysts said it was very unlikely a superior offer for QGC would emerge. The British energy giant that lost out to ConocoPhillips after bidding $13.8 billion for Origin Energy, is set to win out this time.
And analysts say QGC is a perfect fit for BG Group. BG Group will get almost the same CSG resource potential from QGC and the Queensland company's own recent acquisitions, as it would have had with Origin Energy but will pay far less cash. QGC chairman Robert Bryan said that in the eight years since QGC was listed, it prospered "beyond our most optimistic expectations", delivering very significant value to shareholders.
But he said the next phase of QGC's evolution would require a step-change in the company's skills base, organisational resources and balance sheet capacity. QGC aims to become one of the world's first large-scale producers of CSG converted into LNG. BG Group, with this purchase, has the lucrative, energy-hungry markets of the Asian region in its long-term sights. BG Group sees its global LNG supplies aided by securing new supplies from QGC's planned LNG project at Curtis Island in Gladstone harbour in central Queensland.
It says QGC's industry leading CSG skills can be extended internationally as access to conventional fossil fuel sources becomes increasingly challenging and resource companies seek partners with experience developing unconventional gas alternatives. UBS analyst Gordon Ramsay says a significant portion of QGC's market value is based on its CSG-to-LNG prospects, still in the early stage of development. He says the project faces a number of potential development and operational constraints.
These include competition for resources necessary to complete the LNG plant, movement in the Australian dollar against the US dollar and its impact on overall project costs, and managing the water and gas build-up from CSG wells. QGC this week said BG Group and QGC remained "absolutely dedicated" to ensuring the success of the Curtis LNG project. It says BG Group has the financial muscle to make happen what is one of Australia's largest capital infrastructure projects. Citi Investment Research analyst Di Brookman says BG Group's bid is a vote of confidence in the CSG-to-LNG concept even at a time when oil prices have slid to relatively low levels.
Ms Brookman says the project has a slew of risks to confront. It will be exposed to adverse movements in oil prices, LNG prices, exchange rates, interest rates, changes to fiscal terms and global monetary conditions. But she says if the project is successful, it will be a "transformational project for QGC".
Despite the recent retreat in global oil prices, she says Citi continues to believe LNG markets will remain robust as the world increasingly looks for fossil fuel-based energy with less greenhouse gas emissions than coal and oil. Gas-fired power stations produce about half the greenhouse gas emissions of conventional coalfired power plants.
Queensland Gas has about eight CSG tenements in the Surat Basin in southwestern Queensland. It has also launched a friendly takeover of LNG rival Sunshine Gas and earlier this year secured control of Roma Petroleum. Other CSG tenement owners in Queensland's Surat and Bowen basins are Origin Energy, Arrow Energy, Santos and Anglo Coal (Dawson). Analysts see scope for many more QGC and Arrow Energy success stories among the small army of exploration and development companies working up their CSG potential in Queensland and New South Wales.
Wilson HTM analyst Andrew Pedler says candidates in the sector for takeover activity usually have CSG reserves and/or production. "I don't think anyone has any doubts about the long-term CSG sector in eastern Australia and that is the kind of time horizon that BG Group and others are looking at," Mr Pedler says. "There are quite a number of mid-cap and small-cap CSG companies. Not that many are in production but many are coming through stages of testing. There will be others of the likes of the QGCs and Arrows in terms of the mid-cap producers. Its just that they have yet to pass some early hurdles."
Saturday 1/11/2008 Page: 68
THE rise and rise of Queensland Gas peaked this week as it fetched the biggest takeover bid in Queensland corporate history. British energy giant BG Group offered $5.75 a share in cash which valued QGC, which listed just eight years ago, at $5.6 billion. The bid cruised past Queensland's previous acquisition record set in 2003 when Swiss miner Xstrata bought MIM Holdings for $4.93 billion.
The offer price was far from QGC's record closing high price of $6.22, set in May. But amid the carnage on global stockmarkets, the offer is still an alluring 80 per cent premium on QGC's battered share price of $3.20 before the deal was announced. And QGC's directors wasted no time in urging shareholders to cash in quick on the healthy value being put on the potential seen for its vast coal seam gas resources as a feedstock for liquefied natural gas to feed thirsty Asian energy markets.
The process of converting CSG into LNG is far from mature and as costs have spiralled, and debt markets and sharemarkets have wilted as funding sources for cash hungry project developers, accepting BG Group's offer is a no-brainer for QGC. Explaining QGC's enthusiasm for BG Group's offer, QGC chief executive Richard Cottee said spiralling corporate funding costs due to the global credit crunch had increased QGC's weighted average cost of capital (WACC).
"Clearly the world has changed in the last eight weeks and it is important in capitalism to adapt to those changes," he told investors and journalists during a conference call. "Our WACC got whacked ... an 80 per cent premium is none too shabby in this market." BG Group's offer formally closes on December 15 but it said yesterday its QGC stake was now 43.9 per cent. Analysts said it was very unlikely a superior offer for QGC would emerge. The British energy giant that lost out to ConocoPhillips after bidding $13.8 billion for Origin Energy, is set to win out this time.
And analysts say QGC is a perfect fit for BG Group. BG Group will get almost the same CSG resource potential from QGC and the Queensland company's own recent acquisitions, as it would have had with Origin Energy but will pay far less cash. QGC chairman Robert Bryan said that in the eight years since QGC was listed, it prospered "beyond our most optimistic expectations", delivering very significant value to shareholders.
But he said the next phase of QGC's evolution would require a step-change in the company's skills base, organisational resources and balance sheet capacity. QGC aims to become one of the world's first large-scale producers of CSG converted into LNG. BG Group, with this purchase, has the lucrative, energy-hungry markets of the Asian region in its long-term sights. BG Group sees its global LNG supplies aided by securing new supplies from QGC's planned LNG project at Curtis Island in Gladstone harbour in central Queensland.
It says QGC's industry leading CSG skills can be extended internationally as access to conventional fossil fuel sources becomes increasingly challenging and resource companies seek partners with experience developing unconventional gas alternatives. UBS analyst Gordon Ramsay says a significant portion of QGC's market value is based on its CSG-to-LNG prospects, still in the early stage of development. He says the project faces a number of potential development and operational constraints.
These include competition for resources necessary to complete the LNG plant, movement in the Australian dollar against the US dollar and its impact on overall project costs, and managing the water and gas build-up from CSG wells. QGC this week said BG Group and QGC remained "absolutely dedicated" to ensuring the success of the Curtis LNG project. It says BG Group has the financial muscle to make happen what is one of Australia's largest capital infrastructure projects. Citi Investment Research analyst Di Brookman says BG Group's bid is a vote of confidence in the CSG-to-LNG concept even at a time when oil prices have slid to relatively low levels.
Ms Brookman says the project has a slew of risks to confront. It will be exposed to adverse movements in oil prices, LNG prices, exchange rates, interest rates, changes to fiscal terms and global monetary conditions. But she says if the project is successful, it will be a "transformational project for QGC".
Despite the recent retreat in global oil prices, she says Citi continues to believe LNG markets will remain robust as the world increasingly looks for fossil fuel-based energy with less greenhouse gas emissions than coal and oil. Gas-fired power stations produce about half the greenhouse gas emissions of conventional coalfired power plants.
Queensland Gas has about eight CSG tenements in the Surat Basin in southwestern Queensland. It has also launched a friendly takeover of LNG rival Sunshine Gas and earlier this year secured control of Roma Petroleum. Other CSG tenement owners in Queensland's Surat and Bowen basins are Origin Energy, Arrow Energy, Santos and Anglo Coal (Dawson). Analysts see scope for many more QGC and Arrow Energy success stories among the small army of exploration and development companies working up their CSG potential in Queensland and New South Wales.
Wilson HTM analyst Andrew Pedler says candidates in the sector for takeover activity usually have CSG reserves and/or production. "I don't think anyone has any doubts about the long-term CSG sector in eastern Australia and that is the kind of time horizon that BG Group and others are looking at," Mr Pedler says. "There are quite a number of mid-cap and small-cap CSG companies. Not that many are in production but many are coming through stages of testing. There will be others of the likes of the QGCs and Arrows in terms of the mid-cap producers. Its just that they have yet to pass some early hurdles."
Thursday, 25 September 2008
`Cinderella' gas a new gold rush
Courier Mail
Tuesday 9/9/2008 Page: 18
BOB Bryan and Stephen Bizzell are a generation apart but they have both made millions from a new energy source transforming Queensland into a national leader coal seam gas. Bryan, aged 74 and Bizzell, 40, have watched the share price of their respective companies, Queensland Gas and Arrow Energy, skyrocket as investors and major international resource companies realised the potential of CSG to power the developing world as oil reserves dwindle.
News yesterday that Origin Energy had done a $9.6 billion deal with US energy giant ConocoPhillips in the coal seam sector only reinforces their beliefs. It also propels Queensland to the forefront in the new energy source, making the state potentially more significant than the North-West Shelf in terms of gas production and the CSG boom as transformational as the Bowen Basin coal rush.
Long known as the poor cousin to coal and conventional oil and gas, CSG is just as it sounds: natural gas extracted from coal seams, rather than from conventional rock formations. Naturally odourless, it is the same gas that is a hazard for coal miners and which once doomed canaries to act as an unwary warning system underground.
It is formed as a by-product during the creation of coal and when the seam is perforated it allows the gas to flow to the surface, where it is gathered and processed. The gas is later cooled and converted into liquid via a liquid natural gas plant, which usually costs about $2 billion per "train", a line of the plant which gives an indication of its total size (ie a three-train or four-train plant). It is used just like any other form of conventional gas to power water heaters, stoves and space heaters in both domestic and business settings and as a direct source of power for industry and a fuel for electricity generation.
The massive Origin Energy deal with ConocoPhillips, a company with a market capitalisation of $US125 billion, had an immediate impact on the sector yesterday with the share prices of all Queensland CSG explorers rising strongly by between 8 and 30 per cent. It also put a major floor under an industry not long ago battling for credibility and acceptance as a legitimate and viable alternative energy source.
Bryan, who is conservatively worth about $360 million although some suggest his wealth is at least double that, got into CSG via a float of his Queensland Gas group in 2000. After a long career in the resources sector, it was going to be his swan song. He first became aware of CSG in 1968 when he was drilling for other resources because "we had to drill through the stuff to get other things out".
"We scratched around in 2000 and just managed to raise enough money to get going $12 million which was enough to get us over the line," he reflected yesterday. Today the company has a market capitalisation of over $3 billion.
Bizzell entered the market around the same time, his Arrow Energy group having its fair share of sceptics but the company growing well and making him a multi-millionaire many times over as a result. His total wealth is estimated at anywhere between $30 million and $50 million depending on his other investments. Bizzell, an accountant originally who co-founded Arrow with old school mate Nick Mather, has always maintained the CSG sector is "an exciting part of the market which has great potential".
As he watched the Arrow share price rise he attributed the surge to renewed international interest. "We certainly stick out for any player looking at possibly getting a seat at the (CSG) table," he said. The beginning of this decade was a bad time for Bizzell and Bryan to raise cash for coal seam gas because, ironically, Conoco, Origin Energy's partner in the latest deal, had spent more than $100 million looking for CSG in Queensland. It lost all its money and another US group, Amoco, did exactly the same thing.
"Here we were coming along claiming to be able to extract this gas profitably and two of the world's largest oil companies had failed dismally in the exercise so it was very tough indeed and the world was full of sceptics," Bryan said. He described the latest Origin Energy- ConocoPhillips deal as a wonderful endorsement of the sector and tremendously important for Queensland.
The CSG industry has also been boosted by three other major recent deals: British Gas in June made a $13 billion takeover bid for Origin Energy. Given yesterday's news it will now likely not proceed but BG has also entered into an $8 billion agreement to build a liquefied natural gas (LNG) plant at Gladstone with Queensland Gas.
The Malaysian Petronas group has signed a $7 billion deal with Santos to build an LNG plant at Gladstone. The giant Shell group has signed a deal with Arrow Energy which also envisages building a third, smaller, LNG plant at Gladstone. "In reality we are going to have in all probability as much LNG production and export out of Gladstone as they have managed to have on the North- West Shelf in the past 20 years," Bryan said.
The North West Shelf has five trains of capacity, each producing 3.5 million tonnes of LNG but with the proposed four new LNG plants for Gladstone, Queensland will have developments of greater size. Arrow managing director Nick Davies has said that over the medium to long term there was so much CSG in Queensland it could satisfy the state's gas production for the next 300 or 400 years.
Fellow explorer and Sunshine Gas managing director Tony Gilby shares his enthusiasm, pointing out that increased pipeline infrastructure over the past 10 years along with increased demand for gas in general and better technology had put a rocket under the sector.
The news has not been lost on Gladstone. The Gladstone Economic and Industry Development Board (GEIDB) and local council are bracing for the expected flurry of economic activity. "In reality we are not going to see four LNG plants in Gladstone but it is likely we will see one or two plants," one analyst said yesterday.
Local Mayor George Creed yesterday said the council was very "supportive and receptive" in relation to the huge development planned for the region, which must also comply with relevant environmental and social guidelines. The Bligh Government has also established a special State Development Area in the city with an estimated $17 billion worth of potential LNG projects on the table for Gladstone and likely long-term benefits to the Queensland economy estimated at $9 billion.
Coal seam gas has been extracted in the US for more than 25 years with production levels now around 1.9 trillion cubic feet a year and on the rise. That is equivalent to more than two years of production at the North West Shelf LNG joint venture now that its fifth production train has come on line ahead of schedule. As early as the 1970s it was clear Australia had the potential to host a large amount of CSG.
But it was early disappointments like ConocoPhillips, Amoco and Enron, which lost about $200 million drilling for CSG in Queensland, that made it a slow rise for the sector. The big boom did not come until 2000 when Bob Bryan and Stephen Bizzell were setting out and, ironically, as a result of the collapse of the $4 billion PNG gas pipeline.
In 2000, to the astonishment of the state's power coal industry, the then Beattie government released an energy policy that mandated 13 per cent of the state's electricity be sourced from gas by 2005. Analysts and observers at the time suggested that policy was a subsidy for the PNG pipeline, which was finally cancelled last year after years of delays and cost blow-outs.
As the PNG project was continually delayed, CSG explorers kept working to prove up reserves in the Bowen and Surat Basins, signing agreements to supply gas-fired power stations. Some analysts, such as UBS's Gordon Ramsay, are now predicting eastern Australian gas demand could more than double in the next decade. But it is not all good news for consumers. While the rise of CSG has proved a boom, prices to the consumer are likely to rise as a result.
Origin Energy managing director Grant King has long said the sector was operating in what he described as a "new world", predicting much higher gas prices than the industry had ever thought of before. Also boosting the industry and Queensland junior CSG explorers has been a gradual recognition that existing sources of gas supply, such as Bass Strait, have plateaued.
Santos also recently warned that its Cooper Basin production was declining about 8 to 10 per cent a year, making coal seam gas production considerably more attractive. The sector has grown dramatically in just two years and the growth will flow through to Queensland industry, jobs and economic prosperity. As Bob Bryan says: This industry has come a long way from small beginnings and has a long way to go yet."
Tuesday 9/9/2008 Page: 18
BOB Bryan and Stephen Bizzell are a generation apart but they have both made millions from a new energy source transforming Queensland into a national leader coal seam gas. Bryan, aged 74 and Bizzell, 40, have watched the share price of their respective companies, Queensland Gas and Arrow Energy, skyrocket as investors and major international resource companies realised the potential of CSG to power the developing world as oil reserves dwindle.News yesterday that Origin Energy had done a $9.6 billion deal with US energy giant ConocoPhillips in the coal seam sector only reinforces their beliefs. It also propels Queensland to the forefront in the new energy source, making the state potentially more significant than the North-West Shelf in terms of gas production and the CSG boom as transformational as the Bowen Basin coal rush.
Long known as the poor cousin to coal and conventional oil and gas, CSG is just as it sounds: natural gas extracted from coal seams, rather than from conventional rock formations. Naturally odourless, it is the same gas that is a hazard for coal miners and which once doomed canaries to act as an unwary warning system underground.
It is formed as a by-product during the creation of coal and when the seam is perforated it allows the gas to flow to the surface, where it is gathered and processed. The gas is later cooled and converted into liquid via a liquid natural gas plant, which usually costs about $2 billion per "train", a line of the plant which gives an indication of its total size (ie a three-train or four-train plant). It is used just like any other form of conventional gas to power water heaters, stoves and space heaters in both domestic and business settings and as a direct source of power for industry and a fuel for electricity generation.
The massive Origin Energy deal with ConocoPhillips, a company with a market capitalisation of $US125 billion, had an immediate impact on the sector yesterday with the share prices of all Queensland CSG explorers rising strongly by between 8 and 30 per cent. It also put a major floor under an industry not long ago battling for credibility and acceptance as a legitimate and viable alternative energy source.
Bryan, who is conservatively worth about $360 million although some suggest his wealth is at least double that, got into CSG via a float of his Queensland Gas group in 2000. After a long career in the resources sector, it was going to be his swan song. He first became aware of CSG in 1968 when he was drilling for other resources because "we had to drill through the stuff to get other things out".
"We scratched around in 2000 and just managed to raise enough money to get going $12 million which was enough to get us over the line," he reflected yesterday. Today the company has a market capitalisation of over $3 billion.
Bizzell entered the market around the same time, his Arrow Energy group having its fair share of sceptics but the company growing well and making him a multi-millionaire many times over as a result. His total wealth is estimated at anywhere between $30 million and $50 million depending on his other investments. Bizzell, an accountant originally who co-founded Arrow with old school mate Nick Mather, has always maintained the CSG sector is "an exciting part of the market which has great potential".
As he watched the Arrow share price rise he attributed the surge to renewed international interest. "We certainly stick out for any player looking at possibly getting a seat at the (CSG) table," he said. The beginning of this decade was a bad time for Bizzell and Bryan to raise cash for coal seam gas because, ironically, Conoco, Origin Energy's partner in the latest deal, had spent more than $100 million looking for CSG in Queensland. It lost all its money and another US group, Amoco, did exactly the same thing.
"Here we were coming along claiming to be able to extract this gas profitably and two of the world's largest oil companies had failed dismally in the exercise so it was very tough indeed and the world was full of sceptics," Bryan said. He described the latest Origin Energy- ConocoPhillips deal as a wonderful endorsement of the sector and tremendously important for Queensland.
The CSG industry has also been boosted by three other major recent deals: British Gas in June made a $13 billion takeover bid for Origin Energy. Given yesterday's news it will now likely not proceed but BG has also entered into an $8 billion agreement to build a liquefied natural gas (LNG) plant at Gladstone with Queensland Gas.
The Malaysian Petronas group has signed a $7 billion deal with Santos to build an LNG plant at Gladstone. The giant Shell group has signed a deal with Arrow Energy which also envisages building a third, smaller, LNG plant at Gladstone. "In reality we are going to have in all probability as much LNG production and export out of Gladstone as they have managed to have on the North- West Shelf in the past 20 years," Bryan said.
The North West Shelf has five trains of capacity, each producing 3.5 million tonnes of LNG but with the proposed four new LNG plants for Gladstone, Queensland will have developments of greater size. Arrow managing director Nick Davies has said that over the medium to long term there was so much CSG in Queensland it could satisfy the state's gas production for the next 300 or 400 years.
Fellow explorer and Sunshine Gas managing director Tony Gilby shares his enthusiasm, pointing out that increased pipeline infrastructure over the past 10 years along with increased demand for gas in general and better technology had put a rocket under the sector.
The news has not been lost on Gladstone. The Gladstone Economic and Industry Development Board (GEIDB) and local council are bracing for the expected flurry of economic activity. "In reality we are not going to see four LNG plants in Gladstone but it is likely we will see one or two plants," one analyst said yesterday.
Local Mayor George Creed yesterday said the council was very "supportive and receptive" in relation to the huge development planned for the region, which must also comply with relevant environmental and social guidelines. The Bligh Government has also established a special State Development Area in the city with an estimated $17 billion worth of potential LNG projects on the table for Gladstone and likely long-term benefits to the Queensland economy estimated at $9 billion.
Coal seam gas has been extracted in the US for more than 25 years with production levels now around 1.9 trillion cubic feet a year and on the rise. That is equivalent to more than two years of production at the North West Shelf LNG joint venture now that its fifth production train has come on line ahead of schedule. As early as the 1970s it was clear Australia had the potential to host a large amount of CSG.
But it was early disappointments like ConocoPhillips, Amoco and Enron, which lost about $200 million drilling for CSG in Queensland, that made it a slow rise for the sector. The big boom did not come until 2000 when Bob Bryan and Stephen Bizzell were setting out and, ironically, as a result of the collapse of the $4 billion PNG gas pipeline.
In 2000, to the astonishment of the state's power coal industry, the then Beattie government released an energy policy that mandated 13 per cent of the state's electricity be sourced from gas by 2005. Analysts and observers at the time suggested that policy was a subsidy for the PNG pipeline, which was finally cancelled last year after years of delays and cost blow-outs.
As the PNG project was continually delayed, CSG explorers kept working to prove up reserves in the Bowen and Surat Basins, signing agreements to supply gas-fired power stations. Some analysts, such as UBS's Gordon Ramsay, are now predicting eastern Australian gas demand could more than double in the next decade. But it is not all good news for consumers. While the rise of CSG has proved a boom, prices to the consumer are likely to rise as a result.
Origin Energy managing director Grant King has long said the sector was operating in what he described as a "new world", predicting much higher gas prices than the industry had ever thought of before. Also boosting the industry and Queensland junior CSG explorers has been a gradual recognition that existing sources of gas supply, such as Bass Strait, have plateaued.
Santos also recently warned that its Cooper Basin production was declining about 8 to 10 per cent a year, making coal seam gas production considerably more attractive. The sector has grown dramatically in just two years and the growth will flow through to Queensland industry, jobs and economic prosperity. As Bob Bryan says: This industry has come a long way from small beginnings and has a long way to go yet."
Thursday, 18 October 2007
It's the stupid country
Age
Tuesday 16/10/2007 Page: 13
Australian governments have little interest in developing new solar technology, writes Urs Walterlin.
THEY must be counting their blessings, the workers at CSG Solar AG in Thalheim, Germany. Demand for solar power is booming and the people in the eastern state of Sachsen-Anhalt are riding the wave of global change. So successful is the company in developing and manufacturing solar power technology, it recently started to operate around the clock.
Many people in the East had a rough time after the reunification of the two Germanys. The socialist economy was in tatters and there were few prospects for decent, well paid work. Then, in June 2004, came CSG Solar, first with only one employee. But soon demand for solar products expanded, and so did the need for labour. Today CSG Solar employs hundreds. Great for Thalheim. Bad for Australia.
These jobs could be in Horsham or Goulburn. "Crystalline silicon on glass" - solar technology is an Australian invention. It was developed at the University of New South Wales. But Australia lacked the determination and political will to effectively commercialise the brilliant invention. In 2004 CSG Solar purchased the rights. Aussie solar cells are now manufactured where staff eat bockwurst during their lunch breaks, not meat pies.
This is only one example of a phenomenon that surprises even long-term observers of this country. Be it the lack of superfast, cheap broadband everywhere, preventing new entrepreneurs from running a global business from the back of Bourke and breathing new life into struggling communities, or the failure to teach foreign languages in every school in the country, so future managers can say more than "yam cha" when they are trying to set up business in booming China, Australia seems willing to give away even the most obvious opportunities.
For 10 years, some of the most senior Australian politicians have called themselves "global warming sceptics". And they are still proud Kyoto-bashers. So it comes as no surprise that their sudden call to action fails to convince not only many observers, but experts too. A strong focus on so-called "clean coal" and the suggested construction of nuclear power plants look more like "greenwashing" the status quo. The solar power plant planned for Victoria, the so-called "Solar Cities" and the taxpayer-funded brochures asking us to switch off the flat screen TV - they look suspiciously like public relations exercises geared towards increasingly alarmed voters. Such projects certainly are important, but they are hardly the urgently needed kick-start to a fundamentally new way of thinking in a society addicted to plundering and wasting resources.
Meanwhile, Australian businesses wanting to grow by being part of the solution rather than the problem continue to be attracted by countries such as Germany and China. According to new research, solar technology companies are in the top league of Germany's businesses when measured against a set of indicators such as equity ratio and return on investment. Having to use cloudy Germany as an example for the success of solar power policy is quite bizarre.
Practically overnight, a government incentive system has created a new industry that is now top of the world. Last year, approximately 10,000 German companies were developing and manufacturing components for the photovoltaic and solar thermal energy market, employing 54,000 people. According to industry sources, this figure will climb to up to 200,000 by 2020. Thirty-five per cent of production goes into export markets; 70 per cent by 2020.
The Germans themselves are ferocious buyers of solar systems. Why? Owners can sell excess power back to the grid. That's how the average system is paid off within seven to eight years. Yet in Australia it takes between 15 and 20 years. Despite subsidies, the cost of solar power systems remains prohibitive.
"Why doesn't every house in Australia have to have solar power on the roof?" a 14-year old girl from Switzerland recently asked, uncomprehending. "It would make sense." Of course. The failure of the world's sunniest country to create irresistible economic stimuli for the renewable energy industry in order to become the world leader puzzles many observers. Not least because federal and state governments rightly spend billions for the development of other economic opportunities.
They certainly know that investment always flows in the direction where it is welcomed. But some politicians willingly allow hundreds, if not thousands, of jobs to be exported. Is it due to the "comfortable, lazy security of sitting on enough fossilised but dirty resources for hundreds of years", as one correspondent colleague thinks' Is it the iron grip traditional industries have on Australian politics' Or is it short-term thinking, the wish to be elected at the next election, at all costs. Perhaps it is the triumph of ideology and ignorance over reason and responsibility. The decision to build a pulp mill in Tasmania's Tamar Valley indicates that it is probably a mixture of all of these elements.
The damage the project and the continuing logging of native forests will do to Tasmania's highly valuable, sustainable environmental tourism, is an opportunity lost for future generations. Tasmania's reputation as a destination for business is already a victim. For international journalists who visited the island recently, it felt like being in a third world country where major aspects of public life are corrupted by an incestuous relationship between a merciless business and a morally bankrupt political class.
Even if the mill is as clean as Malcolm Turnbull asserts, why would European ecotourists fly around the globe if there is even only a perceived possibility that they will swim in water containing dioxin, drink wine tainted with chemicals and breath air polluted with toxins' They can do that at home, much cheaper, on their balcony, overlooking the autobahn.
Urs Walterlin is a Swiss-Australian foreign correspondent who reports from Australia and the South Pacific for newspapers in Switzerland, Germany and Austria.
Tuesday 16/10/2007 Page: 13
Australian governments have little interest in developing new solar technology, writes Urs Walterlin.
THEY must be counting their blessings, the workers at CSG Solar AG in Thalheim, Germany. Demand for solar power is booming and the people in the eastern state of Sachsen-Anhalt are riding the wave of global change. So successful is the company in developing and manufacturing solar power technology, it recently started to operate around the clock.
Many people in the East had a rough time after the reunification of the two Germanys. The socialist economy was in tatters and there were few prospects for decent, well paid work. Then, in June 2004, came CSG Solar, first with only one employee. But soon demand for solar products expanded, and so did the need for labour. Today CSG Solar employs hundreds. Great for Thalheim. Bad for Australia.
These jobs could be in Horsham or Goulburn. "Crystalline silicon on glass" - solar technology is an Australian invention. It was developed at the University of New South Wales. But Australia lacked the determination and political will to effectively commercialise the brilliant invention. In 2004 CSG Solar purchased the rights. Aussie solar cells are now manufactured where staff eat bockwurst during their lunch breaks, not meat pies.
This is only one example of a phenomenon that surprises even long-term observers of this country. Be it the lack of superfast, cheap broadband everywhere, preventing new entrepreneurs from running a global business from the back of Bourke and breathing new life into struggling communities, or the failure to teach foreign languages in every school in the country, so future managers can say more than "yam cha" when they are trying to set up business in booming China, Australia seems willing to give away even the most obvious opportunities.
For 10 years, some of the most senior Australian politicians have called themselves "global warming sceptics". And they are still proud Kyoto-bashers. So it comes as no surprise that their sudden call to action fails to convince not only many observers, but experts too. A strong focus on so-called "clean coal" and the suggested construction of nuclear power plants look more like "greenwashing" the status quo. The solar power plant planned for Victoria, the so-called "Solar Cities" and the taxpayer-funded brochures asking us to switch off the flat screen TV - they look suspiciously like public relations exercises geared towards increasingly alarmed voters. Such projects certainly are important, but they are hardly the urgently needed kick-start to a fundamentally new way of thinking in a society addicted to plundering and wasting resources.
Meanwhile, Australian businesses wanting to grow by being part of the solution rather than the problem continue to be attracted by countries such as Germany and China. According to new research, solar technology companies are in the top league of Germany's businesses when measured against a set of indicators such as equity ratio and return on investment. Having to use cloudy Germany as an example for the success of solar power policy is quite bizarre.
Practically overnight, a government incentive system has created a new industry that is now top of the world. Last year, approximately 10,000 German companies were developing and manufacturing components for the photovoltaic and solar thermal energy market, employing 54,000 people. According to industry sources, this figure will climb to up to 200,000 by 2020. Thirty-five per cent of production goes into export markets; 70 per cent by 2020.
The Germans themselves are ferocious buyers of solar systems. Why? Owners can sell excess power back to the grid. That's how the average system is paid off within seven to eight years. Yet in Australia it takes between 15 and 20 years. Despite subsidies, the cost of solar power systems remains prohibitive.
"Why doesn't every house in Australia have to have solar power on the roof?" a 14-year old girl from Switzerland recently asked, uncomprehending. "It would make sense." Of course. The failure of the world's sunniest country to create irresistible economic stimuli for the renewable energy industry in order to become the world leader puzzles many observers. Not least because federal and state governments rightly spend billions for the development of other economic opportunities.
They certainly know that investment always flows in the direction where it is welcomed. But some politicians willingly allow hundreds, if not thousands, of jobs to be exported. Is it due to the "comfortable, lazy security of sitting on enough fossilised but dirty resources for hundreds of years", as one correspondent colleague thinks' Is it the iron grip traditional industries have on Australian politics' Or is it short-term thinking, the wish to be elected at the next election, at all costs. Perhaps it is the triumph of ideology and ignorance over reason and responsibility. The decision to build a pulp mill in Tasmania's Tamar Valley indicates that it is probably a mixture of all of these elements.
The damage the project and the continuing logging of native forests will do to Tasmania's highly valuable, sustainable environmental tourism, is an opportunity lost for future generations. Tasmania's reputation as a destination for business is already a victim. For international journalists who visited the island recently, it felt like being in a third world country where major aspects of public life are corrupted by an incestuous relationship between a merciless business and a morally bankrupt political class.
Even if the mill is as clean as Malcolm Turnbull asserts, why would European ecotourists fly around the globe if there is even only a perceived possibility that they will swim in water containing dioxin, drink wine tainted with chemicals and breath air polluted with toxins' They can do that at home, much cheaper, on their balcony, overlooking the autobahn.
Urs Walterlin is a Swiss-Australian foreign correspondent who reports from Australia and the South Pacific for newspapers in Switzerland, Germany and Austria.
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