NSW gives greenlight to Santos’ controversial coal seam gas project

AUSTRALIA’S New South Wales government has backed Santos’ A$3.6bn (US$2.54bn) Narrabri gas development project, which could see 850 coal seam gas wells drilled in a push to boost the state’s energy security.

In the face of widespread opposition, the Department of Planning, Industry and Environment concluded that the economic and energy-related benefits of the project outweigh its impacts, and with a series of conditions to protect the environment, it has recommended that the project is ready for approval by the Independent Planning Commission (IPC).

The project would produce up to 200 TJ of gas per day over at least 20 years, which the government says would supply up to 50% of the state’s projected demand. This follows warnings earlier this year from the Australian Energy Market Operator, which manages the country’s power and gas systems, that unless more projects are developed and pipeline capacity increased, the country’s southern states could see gas supplies fall short of winter demand from 2024.

The department said in its study of the project that despite a wealth of gas resources, New South Wales currently imports 95% of its gas from other states, with the remainder coming from the Camden Gas Project in Sydney which is scheduled to close in 2023. Gas exports to international markets have contributed to domestic prices nearly doubling in the last decade. Santos has committed to sell all the gas to the domestic market.

The project is keenly opposed, with the report noting that 98% of the 23,000 submissions received were against the project. These largely focussed on concerns about further contribution to climate change and impacts on water, air, health and safety.

The department reasons that the project has been designed to minimise such impacts and that investing in gas will help phase out the use of dirtier coal.

Santos CEO Kevin Gallagher said: “We are confident that we have relied upon the best science to confirm that the Narrabri Gas Project can be developed safely and sustainably, without harm to water resources or the environment. However, a consent decision is one for an independent umpire, the IPC”.

The IPC has until early September to hold public hearings and issue a decision.

The Lock the Gate Alliance – a coalition of supporters and local groups including farmers concerned about mining and resource development – has called on the IPC to refuse approval of the project.

“It is inconceivable after the last three years of record drought and climate change being at the forefront of everyone’s minds that our government would even contemplate supporting, let alone approving, a project that puts our only secure water supply at risk,” said Lock the Gate’s David Chadwick.