Queensland Hunter Gas Pipeline

From Global Energy Monitor
This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor.
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The Queensland Hunter Gas Pipeline is a proposed natural gas pipeline.[1]

Location

The proposed pipeline would run from the Wallumbilla gas hub in Queensland to the Narrabri Gas Project in New South Wales, through Gunnedah, Quirindi, Scone, Muswellbrook, Singleton and Maitland to Newcastle, New South Wales.[2]

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Project Details

  • Operator: Jemena
  • Parent Company: Hunter Gas Pipeline
  • Proposed Capacity: 450 terajoules per day (416.1 million cubic feet per day)
  • Length: 513 Miles / 825 kilometers
  • Cost: AUS$1.2 billion (US$870 million)[3]
  • Status: Proposed
  • Start Year: 2023

Background

The pipeline would be owned by Hunter Gas Pipeline and would be built in two phases.[4] Phase One would connect the proposed Narrabi coal seam gas (CSG) project to Hunter's gas storage facility in Newcastle, New South Wales. Phase Two would connect the Narrabi CSG Project with the Wallumbilla gas hub in Queensland. In May 2017 Hunter Gas signed a Memorandum Of Understanding (MOU) to build Phase One of the pipeline at a cost of $A500 million, and operate it.[5] Construction of Phase One was approved in 2009 by the New South Wales government, but will not begin until the government approves the Narrabi CSG Project, according to the pipeline's project director, Garbis Simonian of Hunter Gas Pipeline.[5] This approval gave Hunter Gas Pipeline consent to build the project until February 2014, provided that substantial construction had begun by February 11, 2019.[6]

In December 2018, after ten years in which construction had not begun, and facing heavy opposition to the Narrabri Gas Project, Simonian applied to have the agreement to build the pipeline extended for another five years.[6] In March 2019 Planning Minister Anthony Roberts retroactively extended the approval process for the pipeline for one year despite consent for the pipeline officially lapsing 17 days earlier.[7]

In October 2019 the pipeline was approved by the New South Wales government. Hunter Gas Pipeline Managing Director Garbis Simonian said the company hopes to bring the pipeline online by the end of 2022.[8]

In August 2020, the pipeline promoters were touting the prospects of the project receiving Australian federal government support as well as financing from equity investors and commercial banks. Australia's National COVID-19 Co-ordination Commission had in August recommended that the Australian government underwrite major new gas pipelines and other infrastructure to help underpin an economic recovery from the pandemic.[3] Quirindi farmer Peter Wills, one of many landholders who could be impacted if the pipeline proceeds, expressed alarm about the project potentially receiving federal government backing: "A deal favouring the Hunter Gas Pipeline and burning public money on building it would be a betrayal of rural constituents across its 800 kilometre route. There will be an angry backlash if the National Party allows this to happen. Politicians should not be giving privileged access to companies that want to industrialise farming districts."[9]

The promoters also referred to discussions with unnamed equity investors and two major banks who could provide financing for the pipeline through equity and debt. Financial close for the project is aimed for mid-2021, along with construction start for mid-2022 and commissioning of the pipeline in the second half of 2023.[3]

Opposition

In June 2020 a community meeting for landowners affected by the project was held by Hunter Gas and the Liverpool Plains Shire Council. Attendees said the meeting "raised more questions than it answered" and that gas company representatives failed to address concerns about erosion, black soil, and impacts on local water supplies.[10]

In July 2020, at a hearing of the Independent Planning Commission on the proposed Narrabi CSG Project in which opponents described an "industrial wasteland" and "widespread and inevitable destruction of agriculture across the north west" if the project goes ahead, regional landholders opposed to the proposed Queensland Hunter Gas Pipeline also presented on how the pipeline, a possible conduit for Narrabri gas, would damage farming operations and the environment.[11]

Coal Seam Gas

Coal seam gas is found in coal seams, where underground water pressure keeps it contained. Pumping water out of the coal seam releases this pressure and allows gas to escape from the coal into a well.[12] Coal seam gas wells produce large volumes of water (averaging 10,000 litres of water per day per well in Queensland). This water can contain salt and other contaminants that exist normally in coal seams in varying concentrations.[12]

According to the environmental group Lock The Gate Alliance, the impacts of coal seam gas mining include "encroachment on good farming land, disruption of other land uses and industries, clearing of bushland, air pollution, contamination or depletion of ground or surface water, pollution of waterways, health impacts on workers and nearby residents, and damage to biodiversity."[13]

The practice also raises concerns about global warming because methane is a relatively potent greenhouse gas with a high global warming potential 72 times that of carbon dioxide (averaged over 20 years) or 25 times that of carbon dioxide (averaged over 100 years), according to the IPCC's Third Assessment Report.[14] (Note that the global warming potential of methane was estimated at 21 times that of carbon dioxide, averaged over 100 years, in the IPCC Second Assessment Report, and the 21 figure is currently used for regulatory purposes in the United States.[15]) Methane in the atmosphere is eventually oxidized, producing carbon dioxide and water. This breakdown accounts for the decline in the global warming potential of methane over longer periods of time.

Articles and resources

References

  1. Australia revisits transnational gas pipeline, S&P Platts Global, Jul. 23, 2013
  2. Pipeline supports for CSG hubs, The Australian Pipeliner, Mar. 16, 2016
  3. 3.0 3.1 3.2 Angela Macdonald-Smith, Hunter Gas Pipeline angles for government backing, The Australian Financial Review, Aug. 31, 2020
  4. Hunter Gas Pipeline Project, Hunter Gas Pipeline, accessed March 2018
  5. 5.0 5.1 Queensland Hunter Gas Pipeline joins with Jemena for stage one for Santos Narrabri approval, The Maitland Mercury, May 4, 2017
  6. 6.0 6.1 Gas pipeline backer Garbis Simonian says his $1 billion-plus plan is "insurance" for NSW gas users, New Castle Herald, Dec. 26, 2018
  7. 'Disappointing': Last-minute pipeline, land-clearing changes rile foes, Sydney Morning Herald, Mar. 7, 2019
  8. Hunter pipeline to slash costs of Queensland gas transport, Australian Financial Review, Oct. 23, 2019
  9. Billy Jupp, Quirindi farmers slam Hunter Gas' push for federal government backing for Queensland Hunter Gas Pipeline, Moree Champion, Sep. 2, 2020
  10. Billy Jupp, Farmers claim Hunter-Queensland Gas Pipeline Project meeting raises more questions than answers, Hunter Valley News, Jun. 30, 2020
  11. Narrabri Gas Project opposition flag water, environment, health worries, Narrabri Courier, Jul. 23, 2020
  12. 12.0 12.1 The coal seam gas debate, Parliament of Australia, accessed February 2018
  13. Unconventional Gas Facts: About Coal Seam Gas, Lock The Gate Alliance, Aug. 14, 2015
  14. Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M. Tignor and H.L. Miller (eds.)"Climate Change 2007: Working Group I: The Physical Science Basis: 2.10.2 Direct Global Warming Potentials", IPCC Fourth Assessment Report: Climate Change 2007, Cambridge University Press, 2007.
  15. "Methane," U.S. Environmental Protection Agency information page, accessed July 2010

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