The following Frequently Asked Questions aim to provide the public with easily accessible and comprehensive responses to a range of questions asked by the public in relation to a variety of Energy Resources activities. If you have a relevant question not answered in the following Frequently Asked Questions, please contact the Energy Resources Division.
Find Out The Facts About Offshore Oil and Gas
A public information guide outlining the opportunities and concerns associated with offshore drilling for oil and gas is now available.
The guide is the latest in The Facts series produced by the State Government.Renewed interest in drilling in the Great Australian Bight has prompted the publication of the guide, which outlines the 40-year history of offshore exploration in South Australia, as well as clearly setting out the environmental, safety, regulatory and approval processes.
Designed with the assistance of the National Offshore Petroleum Safety and Environmental Management Authority, the guide is available below.
|The Facts - Offshore Oil and Gas Exploration in South Australia|
|Download The Facts about offshore oil and gas exploration in South Australia (PDF 3.4MB)|
Find Out The Facts About Fracture Stimulation
Decades of experience in South Australia has demonstrated fracture stimulation to be safe and compatible with multiple land use, at more than 750 well locations in the Cooper, Officer and Arrowie basins in the north of South Australia.
Fracture stimulation is a process that reaches oil and gas deep beneath the earth's surface, using a high-pressure mixture of water, sand and a small amount of additives.
The mixture and pressure cause the rock to fracture. Oil or gas that had been trapped in the rock flows into the cracks, and then to the wells and up to the surface.
The impact to the surface and deep underground is minimal. The surface foot-print for deep gas wells are smaller than for shallow coal seam gas extraction and fewer wells are required as deep gas wells flow at higher pressure than shallow wells.
The deep gas reserves in South Australia are quite different to the shallow intensive coal seam gas (CSG) reserves found in Queensland and New South Wales.
South Australia’s prospective gas resources are deep – predominantly 2-4 km below the surface – are separated from fresh water supplies by impermeable rock layers, and hence pose significantly lower potential risks to shallow aquifers.
Fewer wells, pipelines and roads are required to produce deep gas at high pressure than are required for the development of shallow coal seam gas.. Multiple wells can be drilled from a single pad into a deep gas resource, greatly reducing the surface footprint which ensures minimal impact on the environment above ground and on underground water supplies.
Shallow coal seam gas resources, as explored for and developed in Queensland and New South Wales, are of lower pressure and generally located at depths less than 1,000m below surface.
All South Australian fracture stimulation operations have to date been restricted to the Cooper, Officer and Arrowie basins in the north of South Australia.
To date, there are more than 750 fracture stimulated wells in the State, predominately in the Cooper Basin.
In 2013/2014, the Cooper-Eromanga basins produced and generated 17.4% of Australians oil production.
Fracture stimulation has been safely used to enhance flows from both conventional and unconventional reservoirs in more than 750 wells in South Australia since 1969. There is no evidence of adverse impacts on aquifers within the Great Artesian Basin and other shallower aquifers from these fracture stimulation operations.
Fracture stimulation has been used safely in South Australia since 1969, in both conventional and unconventional wells.
More than 750* wells have been fracture stimulated in the north of South Australia, predominately in deep sandstone reservoirs of the Cooper Basin in South Australia.
No fracture stimulation is allowed without detailed assessment to inform stakeholders ahead of consultation.
South Australia has vast, prospective natural gas in unconventional reservoirs that could ensure our State's sustained well-being for decades to come. In 2013, 52% of the State’s electricity was generated from natural gas.
There is increasing evidence that using gas as an energy source is much better for the environment than using coal.
According to the Energy Information Administration (EIA) and other estimates, the Cooper Basin alone is estimated to contain more than 200 trillion cubic feet of recoverable gas in unconventional reservoirs, or enough to supply Australia for 200 years.
Fracture stimulation provides an economically viable way for petroleum companies to access South Australia’s gas reserves. It is regulated using best practice frameworks for environmental protection and petroleum production has generated more than $42 billion dollars for our State’s economy.
International evidence and the experience in South Australia since 1969 demonstrate that fracture stimulation can occur in our oil and gas fields without harm to social, natural and economic environments.
In South Australia, recognised, leading-practice, industry standards are used for all upstream petroleum operations, in order to manage all potential risks in ways that meet community expectations for outcomes. No petroleum projects are allowed to commence unless it can be demonstrated to regulatory authorities that these standards can and will be met.
Under South Australian legislation it is an offence to contaminate or adversely affect aquifers as a result of petroleum exploration and production activities.
The mixture used in fracture stimulation in South Australia is more than 99% sand and water. The small amount of other additives – approximately 0.5% of the total mixture – is made up of chemicals commonly used in hair products, food processing and household cleaning products.
On average, fracture stimulation uses around 7.5 megalitres per well. This equates to about three Olympic swimming pools or the volume required to produce 10 tonnes of wheat.
As part of petroleum development, companies must use water sources in ways that minimise all negative impact on other water users, including water required for agricultural and environmental needs.
Water use must be under taken in accordance with principles set out in the relevant Regional Natural Resource Management (NRM) Plan and the relevant Water Allocation Plan (WAP).
South Australian law prohibits any drilling or well operations that will contaminate underground aquifers.
Prior to any well operations being undertaken such as fracture stimulation, appropriate baseline studies must be undertaken. As part of these baseline studies the existing overall health of the environment needs to be evaluated, including shallow aquifers.
In South Australia, fracture stimulation in deep gas resources pose significantly lower risks to shallow aquifers, as these resources are located2-5 km below surface, which is quite different to the proximity of shallow coal seam gas resources to potable aquifers in Queensland and New South Wales. Coal seam gas targets in Queensland and New South Wales are located less than 1km below surface.
Historical evidence demonstrates that farming and petroleum exploration and production can and does co-exist in South Australia.
The Limestone Coast region in the South East of South Australia has a long history of gas exploration and production compatibly coexisting within strong agricultural operations. Indeed, more than 100 oil and gas exploration wells have been drilled over the last 100 years in this region without deleterious impacts on social, natural and economic environments. No damage to water is evidenced from this long history of petroleum exploration and production operations.
The South Australian Government recognises that people feel very strongly about their land and the homes and farming activities that may occur on it. It works closely with local communities to identify potential issues and ensure any project application addresses these issues.
While some interruption of very local farming activities must occur during petroleum well operations, the ‘footprint’ for petroleum operations is small and petroleum well bores are largely no more than the diameter of an A4 piece of paper.
The Petroleum and Geothermal Energy Act 2000 states that approval can only be given once the company can demonstrate that all risks to the health and safety of the community and to the environment are either completely avoided, or reduced to a level that is as low as reasonably practicable and acceptable to the community and other land users.
This process requires extensive consultation with stakeholders including land owners, cultural heritage and native title groups, community groups and government agencies.
The Department of the Premier and Cabinet carefully assesses each project application on its merits to ensure that only environmentally sustainable projects are granted land access.
To ensure protection of potable aquifers and hence other land users’ access to that water, the approval process also requires that background sampling and analysis of aquifers are undertaken before drilling activities commence.
Regular ongoing sampling is then undertaken at appropriate intervals to demonstrate that no contamination is occurring. Furthermore, prior to the completion of the well, the licensee must demonstrate that cement integrity behind the casing is adequate.
In South Australia, all oil and gas exploration and production activities are regulated by the Department of State Development under the Petroleum and Geothermal Energy Act 2000 (PGE Act).
The objectives of the PGE Act and its Regulations are to ensure that all risks to the health and safety of the community and to the environment are either completely avoided, or managed and reduced to a level that is as low as reasonably practicable and acceptable to the community.
All activities regulated under the PGE Act are also subject to the provisions of other state environmental regulation such as the National Parks and Wildlife Act 1972; the Natural Resources Management Act 2004 (NRM Act); the Work, Health and Safety Act 2012; and the Environment Protection Act 1993. This in turn creates another layer of protection.
The PGE Act and its associated Regulations can be readily accessed through the South Australian legislation website www.legislation.sa.gov.au.
Regulated activities under the PGE Act cannot be carried out unless there is an approved Statement of Environmental Objectives (SEO) in place, prepared on the basis of an Environmental Impact Report (EIR).
The EIR identifies all potential risks relating to the activity and describes the appropriate risk mitigation strategies.
The SEO identifies the environmental objectives to be achieved and the criteria to be used to assess achievement of the objectives.
These documents are required to be developed in consultation with potentially affected stakeholders (including farmers) with the right to be consulted with and to raise any issues and concerns (including those associated with other uses of the land).
A comprehensive and extensive public consultation process is then undertaken in relation to SEOs to demonstrate how all risks are addressed to as low as reasonably practicable.
Only when community concerns have been adequately addressed and all significant risks are effectively managed does the government then consider granting approval.
A timely notice of entry must also be provided to landowners in regards to land access conditions, and terms for entry to land include compensation for any deprivation or impairment of the use and enjoyment of the land.
Under the Petroleum and Geothermal Energy Act 2000, approval will only be granted once the community are adequately satisfied that all risks to the environment, other land users and the precious water resources are manageable.
The notice of entry to land process also provides the landowner with rights to dispute entry and to seek resolution on terms of entry.
The legislation also states that companies must make sure potentially affected people, enterprises and organisations are provided with all the relevant information necessary to reach informed views before any approvals can be made.
The South Australian Government has established the Oil and Gas Roundtable to ensure all people affected by oil and gas operations – from residents and farmers to geologists, environmentalists, academics and regulators (for all forms of social, natural and economic environmental protection) – are updated and can comment on proposed activities.
Strict monitoring, reporting and regular maintenance based upon recognised, leading-practice industry standards are imposed on licensees to demonstrate compliance with regulatory requirements.
Licensees must also demonstrate compliance with relevant Statement of Environmental Objectives (SEOs). This includes public access to risk management strategies and industry performance outcomes.
Furthermore, timely and effective notice of entry to inform potentially affected people, enterprises and organisations must be given – and is open to a dispute resolution process that culminates in a court of law. Fair compensation is required to be paid to affected people, enterprises and organisations both to be able to reach informed views, and to offset any loss or deprivation. All these steps must be concluded and agreed upon before an activity commences, or activities are not allowed to be undertaken.
If these conditions are not met then the government can impose regulatory enforcement sanctions.
|Unconventional Gas in South Australia||Underground Coal Gasification in South Australia|
|Download the brochure about unconventional gas in South Australia (PDF 1.9 MB)||Download the brochure about Underground Coal Gasification in South Australia (PDF 351 KB)|
Review of Hydrofracturing and Induced Seismicity
Geoscience Australia recently released a report on hydraulic fracture stimulation and induced seismicity, designed as a resource for all stakeholders.
COAG Energy Council UPR Frequently Asked Questions
On 27 June 2018, the Council Of Australian Governments (COAG) Upstream Petroleum Resources (UPR) working group published a set of Frequently Asked Questions about onshore gas development in Australia which is available on its website.