perth basin shale gas rush is on ...

I'm not sure if this article has already been posted on the NWE threads recently, but I haven't seen it. The original link at naturalgasasia (see link below) has it dated 22nd April, 2012.

Anyways, happy reading ...

___________________________________________________

[Sources: www.naturalgasasia.com & www.pnronline.com.au]

Perth Basin Shale Gas Rush Is On

The shale gas rush is on in the Perth Basin now that the WA Government has given four shale and tight gas proof-of-concept proposals the all-clear. The companies that stand to benefit from this decision are AWE Ltd, Norwest Energy and Latent Petroleum.


A worker making a connection between two drill collars on Arrowsmith-2. Photo courtesy of Norwest Energy.

WA Environment Minister Bill Marmion rejected an appeal from the Conservation Council of Western Australia (CCWA) which claimed that 'fraccing' in coal and shale deposits has caused serious contamination and even earthquakes elsewhere.

The Environmental Protection Authority (EPA) found that proposals for small scale activities involving fraccing to test the potential for commercial flows of gas – an essential part of extracting gas from low-porosity rocks – in WA's midwest were unlikely to have a significant impact on the environment and should be assessed and managed by the Department of Mines and Petroleum (DMP).


Arrowsmith-2 location map.

APPEA applauded the decision as a win for companies advocating science-based regulation of the sector.

Based on the current availability of equipment in Australia to undertake the work, AWE expects that the hydraulic stimulation activities on all three wells (Woodada Deep-1, Senecio-2 and Arrowsmith-2) in the onshore Perth Basin will commence in Q2 this year.

AWE Managing Director Bruce Clement said the company has identified significant potential for shale gas and tight gas in the onshore Perth Basin and now looks forward to working with all stakeholders, including the government and local communities, to test this potential.

Norwest Energy will immediately re-commence operations to implement the Arrowsmith-2 program as soon as possible. The Arrowsmith-2 well was successfully drilled in June 2011, with the drilling and evaluation results exhibiting necessary shale gas indicators. The hydraulic stimulation and flow testing is the final phase to complete this proof of concept program.


The derrickman and the ‘travelling block’ on Arrowsmith-2. Photo courtesy of Norwest Energy.

Norwest is working with Halliburton to secure the fracture stimulation equipment for Arrowsmith-2. The frac' spread is currently being utilised in the Cooper Basin until late April 2012; then, assuming there are no delays, will be serviced and immediately mobilised to the northern Perth Basin to commence operations. Norwest is well advanced with planning, procurement and site preparation for delivery of the fracc spread.

Norwest Chief Executive Peter Munachen said the WA Government's decision is critical in paving the way for the company to finally prove the shale gas potential at Arrowsmith-2.


The Arrowsmith-2 rig seen at dusk. Photo courtesy of Norwest Energy.

"Success will ultimately contribute to the development of what is expected to be a significant shale gas industry in WA, generating economic benefits to local communities such as employment, training and associated business opportunities, as well as significant royalties to the state", he said.

He also told PESA News Resources that the south and midwest of WA has the potential to produce plenty of gas for WA's domestic market that is in desperate need of energy security once the North West Shelf contracts run out within three years.

Transerv, owner of Latent Petroleum, said the decision "removes a critical hurdle to the further evaluation and potential commercialisation of tight and shale gas fields in Western Australia". Transverv is currently advancing its Warro gas field about 200 km north of Perth via Latent.

Last year, the US Energy Information Agency estimated that WA holds the world's fifth largest reserves of shale gas in the Perth and Canning basins. This represents about twice WA's remaining offshore gas reserves. It is estimated that WA's unconventional gas reserves could provide enough energy to power a city of 1 MM people for over 5000 years.


A panoramic view of the Arrowsmith-2 well site. Photo courtesy of Norwest Energy.

CCWA's peak environment group has expressed grave concern about potential for chemical contamination of the state's groundwater resources after the decision.

"The Minister responsible for protecting Western Australia's environment and water resources has allowed this industry into WA with no environmental assessment by the EPA", CCWA said, adding that "there is currently no public information on what environmental conditions are being applied to gas fraccing projects by the DMP, or whether these conditions are being met".

However, AWE's website has a document detailing the specific environmental risks associated with the Woodada Deep-1 hydraulic fracture stimulation program and the mitigation measures that will be implemented. This document has been reviewed and approved by the DMP. The other companies involved will be displaying theirs online as soon as the documents have been approved.

APPEA Chief Operating Officer for the Western Region, Stedman Ellis, said that Marmion's decision was based on sound science, adding that it would provide effective environmental protection while reducing unnecessary delays. He said the gas industry has a 40-year history of successful production in WA – including the use of hydraulic fracturing.

"Fraccing has been used internationally for more than 60 years in more than 2 MM oil and gas wells. It is a well understood process that has been studied many times and in several countries. It has consistently been shown to be safe", Ellis said.

APPEA believes WA has a mature oil and gas industry supported by a strong regulatory framework, and said that it supports a "robust, transparent and proportionate regulatory system – backed by an industry code of operating practises for shale and tight gas hydraulic fracturing as well as ongoing improvements to the regulation of the industry based on recent independent review of state regulations".

"Establishing an onshore gas industry in WA will help underpin the State's powerhouse economic performance. Natural gas is also important to the environment, as it is the most effective way to reduce greenhouse emissions from power generation", Ellis said.


Ends.

Link to Article: Please Click Here!