Thousands of New South Wales residents marched against coal seam gas mining over the weekend.
3,000 people have marched in the New South Wales coastal town of Murwillumbah, in protest against coal seam gas (CSG) mining. Another 1,000 protestors held a rally in Sydney’s inner-west, and more rallies are likely across the country in the week ahead.
That follows the NSW state government’s comments that CSG mining is inevitable. Protestors are concerned that governments are not doing enough to protect the environment from coal seam gas mining, and fears that CSG miners have unlimited access to any part of the state, including water catchment areas and prime agricultural land.
There are also fears that problems like those already experienced in Queensland will affect farmers and other land owners in NSW. Gas wells that leak, contamination and depletion of the water supply, and heavy-handed dealings by the major CSG companies are all issues that have been raised in that state. Farmers have also complained about not being compensated adequately, while the value of their land has fallen, due to the presence of gas wells.
There are more than 450 CSG wells drilled each year in Queensland by companies including Santos Limited (ASX: STO), Origin Energy (ASX: ORG) and Drillsearch Energy (ASX: DLS), with many already producing. Queensland’s Bowen and Surat Basins alone contain massive gas resources – in fact so much, that there are plans for multiple liquefied natural gas (LNG) plants in Queensland, with much of the gas coming from CSG wells. 70% of the gas used in the state currently comes from CSG.
With south-eastern Australia’s main gas supply from South Australia’s Cooper Basin due to decline in a few years (according to AGL Energy), new sources of energy need to be found. Because of the large coal deposits in Queensland and New South Wales, supplies of CSG are plentiful, and its close location to major markets means it’s a cheaper alternative than other gas resources such as Western Australia’s Northwest Shelf. The other issue is CSG is mainly made up of methane, a greenhouse gas that retain 20 times more heat in the atmosphere than carbon dioxide and contributing to global warming (again, according to AGL Energy), so its better for the environment to be captured and used.
You can see why there’s pressure on the NSW government to allow CSG mining to go ahead. Let’s hope they’ve learnt a thing or two from Queensland’s experience.
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Editor’s note: The original version of this article included Beach Energy (ASX: BPT) as a Coal Seam Gas producer. Beach does not produce Coal Seam Gas.
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Motley Fool writer/analyst Mike King owns shares in Drillsearch. The Motley Fool’s purpose is to help the world invest, better. Take Stock is The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, whilst it’s still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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