Coal seam gas (CSG) – also known as coal seam methane or coal bed methane ‑ is a form of natural gas trapped in coal deposits by water and ground pressure. It can be used to power electricity stations and for domestic gas supply, in the same way as conventional natural gas.
Miners have known for centuries that coal can release large volumes of methane gas. For underground miners, methane is a potentially deadly hazard.
In recent years, a new generation of gas explorers has perfected techniques to extract coal seam gas safely and at a low cost, without mining. A well is drilled from the surface through the coal seam. A special purpose drill bit is used to ream a cavity in the coal seam that is much wider than the diameter of the well. Perforated steel casing is then lowered down the hole to create a production zone. Water is pumped from this zone to the surface, which lowers the pressure and allows gas to flow out of the coal seam.
Coal seam gas wells are drilled to much shallower depths than conventional natural gas wells, and are therefore much less expensive. However, many wells are typically needed to match the production of a conventional gas field.
CSG is a major source of energy in the United States and Canada. Australia also has rich deposits that are being developed as the basis of an LNG export industry on the east coast.
AOE Price at posting:
$3.87 Sentiment: Buy Disclosure: Held
