Gladstone LNG Terminal

From Global Energy Monitor
This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor.
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Gladstone LNG Terminal is an LNG terminal in Queensland, Australia.

Location

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Project Details

  • Owner:
  • Parent: Santos (30%), Petronas (27.5%), Total (27.5%), Kogas (15%)
  • Location: Curtis Island, Gladstone, Queensland, Australia
  • Coordinates: -23.776, 151.2103 (exact)
  • Capacity: 10 mtpa, 1.43 bcfd
  • Additional Proposed Capacity:
  • Status: Operating
  • Type: Export
  • Start Year: Train 1: 2015; Train 2: 2016

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day

Background

Gladstone LNG Terminal is an LNG terminal on Curtis Island in Queensland, Australia on the edge of the Great Barrier Reef.[1] It converts coal-seam gas into LNG.[2] Curtis Island's three plants Australia Pacific LNG Terminal, Gladstone LNG Terminal, Queensland Curtis LNG Terminal are worth $70 billion.[3]

On October 22, 2010, the Australian federal government gave conditional approval to two major coal seam gas projects in central Queensland. Environment Minister Tony Burke announced that his department had given conditional environmental approvals for Gladstone Liquefied Natural Gas (GLNG) - a $16 billion joint venture between Santos, Malaysia's Petronas, and France's Total - and BG Group's Queensland Curtis LNG.[4]

Industry-wide, LNG expansion hit some snags. In 2015 Australia’s geology research agency, Geoscience Australia, wrote in a report to the Council of Australian Governments Energy Council, that Australia's LNG reserves exceeded requirements.[2]

In 2016 Geoscience Australia claimed proven and estimated reserves held by Gladstone’s three LNG plants had decreased 5% in 2016 to 29.6 trillion cubic feet, largely caused by a drop at the Gladstone LNG plant. Consultant EnergyQuest reported in January 2017 that substantial coal-seam gas reserves to Gladstone LNG have yet to demonstrated commercial viability.[2]

In 2016 Santos announced a write-down of the value of Gladstone LNG by $1.5 billion. Previously Santos inflated the value of its assets.[5]

In June 2017, the Institute for Energy Economics and Financial Analysis (IEEFA) predicted liquefaction trains at Gladstone LNG would stop production in two years.[6]

Analysts from the Petroleum Economist predicted in July 2017 that two of the Curtis Island plants, Gladstone LNG Terminal and Queensland Curtis LNG Terminal, would likely operate below capacity until global demand exceeds supply.[7]

In 2017, the Prime Minister of Australia, Malcolm Turnbull announced April that gas prices should halve as a result of new LNG export restrictions. Gas export restrictions are expected to have the biggest impact on Gladstone. [8]

As of 2017, Australia is the second largest LNG exporter after Qatar. The country exports almost 44 million tons a year. [9]

Environmental Concerns

Dredging to widen and deepen the Port of Gladstone to allow for several LNG projects in the port caused some ocean turbidity and possible damage to wildlife and the fishing industry.[10]

In 2011 the Queensland Government announced it will close up to 311 square miles (500 square kilometers) of Queensland coast to fishing. At the same time, the government warned that seafood should not be handled or eaten.[10]

Divisions emerged over whether dredging caused these issues.[10] The release of acid sulphate from dredging may have damaged and killed turtles and fish. Fishermen had been warning about problems since October 2010. Thirty percent of the catch was infected for a month during August and September 2011.[10]

Bloomberg published an article in 2017 citing Curtis Island's three plants in Australia (Australia Pacific LNG Terminal, Gladstone LNG Terminal, Queensland Curtis LNG Terminal) as an example of having exorbitant infrastructure duplication that it could have saved $10 billion on the combined $70 billion LNG projects. The three LNGs built separate jetties that now crowd the coastal land. Shared facilities could have produced the same amount of fuel with less damage to the coast.[11]

This facility is estimated to generate 0.35 metric tons of carbon dioxide equivalent (CO2e) for every metric ton of LNG produced according to a 2013 report.[12]

Coal Seam Environmental Concerns

In December 2014, Queensland Curtis LNG Terminal‎‎ became the world's first project to turn coal seam gas into LNG for export. Curtis Island's two other LNG plants, Australia Pacific LNG Terminal and Gladstone LNG Terminal also convert coal seam gas into LNG.[13]

Coal seam gas projects in Australia are not without controversy.

Coal seam gas (abbreviated "CSG") is formed by the geological process of heating and compressing plant matter to create coal. Over millions of years, methane forms within the coal. The methane is trapped by water in the gaps and cracks between the coal molecules. These gaps are known as cleats. Australia has been found to have many deposits, and is increasingly mining them through hydraulic fracturing, also known as fracking.[14]

CSG is a form of coalbed methane (CBM), or coalbed gas, and is a type of natural gas extracted from coal beds. In recent decades it has become an increasingly used source of energy in Australia, as well as the United States, Canada, and other countries.[14]

Articles and resources

References

  1. Gladstone LNG Terminal, A Barrel Full, accessed April 2017
  2. 2.0 2.1 2.2 Matt Chambers, "Geoscience warns of supply issues for 20-year LNG contracts," The Australian, June 9, 2017.
  3. Tegan Annett, "450 JOBS: Workers needed for major LNG plant shut down," The Observer, June 10, 2017.
  4. "Federal Government approves coal seam gas projects in central Queensland" news.com.au, Oct. 22, 2010.
  5. Michael Slezak,"Santos’s 'fanciful' LNG projections 'inflating value of assets by billions'" The Guardian, August 29, 2016.
  6. Bruce Robertson, "First Australian export LNG plant could close within 3 years," Reneweconomy, June 6, 2017.
  7. Selwyn Parker, "Australian LNG under pressure," Petroleum Economist, July 5, 2017.
  8. Paul Karp,"Gas producers attack export controls as industrial users cheer 'bold' changes" The Guardian, April 26, 2016.
  9. Diane Munro, [http://www.agsiw.org/qatar-moves-ensure-lng-dominance/ "Qatar Moves to Ensure LNG Dominance ,"] Arab Gulf States Institute in Washington, April 17, 2017.
  10. 10.0 10.1 10.2 10.3 Brian Williams, "Warning: Gladstone fish off the menu and central Qld coast closed to fishing," CourierMail, September 11, 2017.
  11. Dan Murtaugh, "Energy Titans Get Schooled in Sharing as Billions Seen Blown," Bloomberg, May 9, 2017.
  12. "BC’S Carbon Pollution Could Double with LNG Plants" Tarika Powell, Sightline Institute, June 7, 2017.
  13. Zara Margolis and Cassandra Hough, "Queensland company to be first in the world to export LNG from coal seam gas," ABC, December 23, 2014.
  14. 14.0 14.1 "Jargon Buster". BG Group. Retrieved 18 July 2010.

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