CSG development is launching a new era of economic activity across Queensland’s regional areas as key players enter the market. The industry is attracting billions of dollars of investment in gas reserves as the Queensland Government strives to meet targets to increase gas use in electricity generation from 13 - 15 per cent by 2015.

Traditionally water from CSG production has been disposed of within evaporation ponds, however industry is looking at alternate water management strategies from agricultural irrigation to water supply for local townships, industrial use such as power stations or stock watering.

“We need to be mindful of not only producing gas, but managing the water through an integrated water management strategy,” said Senior Environmental Scientist Benita Blunden from environmental and engineering consulting firm URS Queensland.

The identification and implementation of a sustainable management and disposal of CSG water is a key issue given the nature of the water produced. It is often difficult to predict the level of supply, and quality of water produced, all of which is complicated by the current regulatory frameworks.

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The legislation enabling beneficial reuse of CSG water for commercial purposes, combined with a short history of CSG production in Queensland, is difficult. In particular, the current water trading frameworks, the inability to store water for use within underground aquifers and the involvement of multiple regulatory agencies.

Specifically, CSG water is classed as regulated waste under the current legislation and the industry needs approval to transfer the waste into water. Given there are several Acts to understand and refer to, there is no certainty if, and when, a companies water management plan will be approved. This is also complicated by the water storage process that involves both water production in large volumes that need to be disposed of or managed appropriately; and, the considerable cost of water pipelines given there is a decrease in water over time; and that there is no definitive timeframe provided for the approvals process.

In essence, a domino effect is created: companies drill wells into the coal seam bringing large water volumes to the surface that require immediate management yet current approvals for beneficial reuse can take between 12 - 18 months.

Legislation and beneficial reuse processes are adequate for the traditional oil and gas environment, however industry must collaborate to determine what can be done collectively with the water created from CSG extraction.

Industry has been collaborating to determine a process for moving forward and optimising the economic and environmental benefits of a proactive CSG water management strategy. Within Queensland, CSG industry members have met to discuss a process for moving forward. Critical to this was:

  • The establishment of key terms of reference;
  • The circulation and agreement of a terms of reference;
  • The request to APPEA to facilitate communication between industry and government; and,
  • The development of a communication process between the industry Water Management Taskforce (comprising industry members), APPEA and the Government.

No doubt as the market for CSG continues to prosper, we are likely to see a continuation of industry and government participation to maximise outcomes and efficiencies.