government approves coal seam gas projects

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The federal government has approved Australia's first multi-billion-dollar coal seam gas projects, angering farmers and environmentalists but promising a major jobs boost for Queensland.

Environment Minister Tony Burke told a media conference in Canberra on Friday his department had given conditional environmental approvals for Gladstone Liquefied Natural Gas (GLNG) - a joint venture between Santos, Malaysia's Petronas and France's Total - and BG Group's Queensland Curtis LNG.

"I have decided that these projects can go ahead without unacceptable impacts on matters protected under national environmental law," Mr Burke said, revealing he had placed 300 conditions on each of the projects.

"We must protect the Great Artesian Basin, our threatened species, our waterways and the Great Barrier Reef."

The approvals were delayed earlier this year by Mr Burke's predecessor, Peter Garrett, who was concerned about the projects' potential impact on groundwater and the Great Barrier Reef.

Santos chief executive David Knox said the environmental approval was an important milestone for GLNG ahead of a final investment decision later this year.

"As our EIS submission outlined, we are committed to implementing comprehensive environmental management plans," Mr Knox said in a statement on Friday.

A final investment decision will be made later this year.

The $16 billion GLNG project involves 2650 coal seam gas wells being drilled over 25 years in Queensland's Surat and Bowen Basins, a 435km steel pipeline from the Fairview gas fields to Gladstone, and an LNG plant and export facility on Curtis Island.

The project is expected to create about 5000 construction jobs, as well as 1000 permanent operational jobs from the start of shipments of LNG in 2014.

QGC Pty Ltd, a BG Group business, received Queensland government approval for the Queensland Curtis LNG (QCLNG) project in June.

Analysts have put the cost of the project at between $12 billion and $18 billion.

The project involves coal seam gas operations in the Surat Basin, a 540km underground pipeline network and LNG plant on Curtis Island.

An estimated 5000 jobs will be created during construction with more than 700 during operation.

Green groups and farmers have raised concerns about coal seam gas development.

This week, four toxic chemicals - benzene, toluene, ethylbenzene and xylene (BTEX) - were discovered in eight exploration wells owned by Australia Pacific LNG in the Surat Basin.

The Queensland government has dismissed calls for a moratorium on the coal seam gas industry, which environmentalists say poses a threat to marine life on the Great Barrier Reef and underground water, and could seriously degrade land.

Mr Burke said one of the more critical conditions surrounded how to deal with the issue of water within coal seams.

"The companies must carry out detailed planning and monitoring to protect groundwater resources, and submit management plans for aquifers, groundwater and surface water for approval," the minister said.

Queensland Farmers Federation CEO Dan Galligan said his members feared the rapid expansion of the gas industry was outpacing the science and planning, especially in terms of its impact on water.

"The country needs these water resources for the long term to produce food, fibre and wealth long after the minerals and gas are extracted," he said.

Queensland Premier Anna Bligh said the federal government had struck the right balance, imposing the most stringent environmental conditions on any industrial project in Australia's history while enabling the projects to go ahead.

Australian Greens senator-elect and environmental lawyer Larissa Waters said the number of conditions showed the measure of the risks involved.

Ms Waters said coal seam gas was no cleaner than coal.

"By the time it gets extracted, transported and liquefied it's 98 per cent as greenhouse gas-intensive as coal, so it's a furphy to say this is clean when we have genuine clean alternatives in renewable energy that aren't threatening farmland," she said.