Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

After Senator Mason’s contribution, I think this may be somewhat of an anticlimax. I refer to an Australian Stock Exchange announcement of 31 January entitled ‘Bloodwood Creek Environment Update’. It comes from the company Carbon Energy. It begins:

Carbon Energy Limited … advises that it has received a notice from the Queensland Department of Environment and Resource Management (DERM) extending the date for a final decision on the Company’s amended Environmental Authorities to 11 February 2011.

This statement goes on to refer to the underground coal gasification program that this company is involved in on the Darling Downs. I draw the Senate’s attention to the last couple of paragraphs of the statement:

The Company also notes recent media commentary referencing unsubstantiated accusations by a former employee of Carbon Energy, Mr John Wedgwood, regarding environmental compliance at the Company’s site.

It goes on to note that Mr Wedgwood is no longer working with the company, although throughout his employment he was responsible for the company’s environmental compliance. It is not the matter of the dispute between Mr Wedgwood and the company Carbon Energy that has motivated me to speak tonight, but rather the program for underground coal gasification that the company is involved in, which involves both of those parties.

Underground coal gasification involves burning the coal seam underground in the presence of steam and oxygen. The resulting chemical reaction produces ‘syngas’, which is a mixture of methane, carbon monoxide and carbon dioxide. This gas is usually used for running a gas-fired power station, which would be built nearby. The Carbon Energy plant at Kogan was part of a three-plant trial of underground coal gasification allowed by the Queensland government. The other two were Cougar at Kingaroy and Linc Energy at Chinchilla. Cougar has been shut down by the state government because of pollution issues.

The Carbon Energy plant at Kogan hit problems on 2 December 2008, according to information I have been given. This is the order of the events of those problems, which is effectively similar to what is outlined in a Carbon Energy interim board report which I have circulated to the whips of the government and opposition and which I seek leave to table.

Leave not granted.

I should say to the chamber what is obvious: we are way ahead of schedule here tonight and I was expecting to be speaking in an hour or two’s time. I circulated this 100-plus page document only a short while ago, and Senator Abetz, on behalf of the opposition, has asked for more time to look at it. Under those circumstances, I hope that it will be considered for tabling when the Senate next resumes.

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

Senator Brown, if you will allow me to interject for the Hansard, yes, that is what we will be doing.

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Thank you.

John Hogg (President) Share this | Link to this | Hansard source

Interjections are normally disorderly, but I will allow it on this occasion.

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

You are most gracious, Mr President. Thank you.

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

There was a blockage in the vertical injection well that carried air onto the coalface, which made it difficult to maintain ignition in this project. The company decided to drill down a second injection well to connect up with the first injection well in order to bypass the blockage and get air to the ‘reactor’—that is, the ignition site—of the project, which effectively burns coal underground. Instead of connecting with this pipe, the second injection well hit gasification and a ‘huff and puff’ explosion occurred. Hydrogen and steam blew back up the pipe. By inference, the reactor had moved from its original position, which it definitely is not supposed to do. I repeat that a reactor is an underground conflagration. That situation is called a ‘nightmare scenario’ in underground coal gasification circles, because it means it is out of control. During this time, bubbles of carbon monoxide and carbon dioxide were observed on water at the surface 100 metres from the plant. This gas had probably made its way to the surface through cracks and fissures that were probably created by that explosive process called ‘huff and puff’.

The second reactor also began to die—that is, to cease to burn—and so the company drilled a third injection well. They pressurised this to 3,600 kPa, nearly twice the hydrostatic pressure. The pressure inside the chamber should be just slightly below that of the outside hydrostatic pressure. Otherwise, if the inside pressure is too low, underground water will flow in. It will flow out if the inside pressure is too high. Water flowing through and out of the chamber means the contaminants created by the chemical reactions—and these include benzene, toluene, xylene and phenolic compounds—will get into the local aquifers. In this case, I am told, the reactor continued to die and was finally shut down in about April 2009. The five-megawatt power station built to run on the gas produced by the plant did not work because there was no gas. The Department of Environment and Resource Management was not told about most of this—that is, the explosive event and the over-pressurisation. I understand it was also not told that much of the underground water monitoring system did not work.

These are allegations which I have not personally been able to attend to, but I am sufficiently concerned about the matter to draw it to public notice. From Mr Wedgwood’s allegations, but also from the company work, I am concerned that there were possible specific breaches of the environmental management plan. The plan called for two key items—firstly, operating the gasification face below local hydrostatic pressure. This is the principle, as I have already said, that the pressure fed into the reactor at the face of the panel should not exceed the hydrostatic pressure of the groundwater surrounding the gasification process. The theory was that no contaminants would be driven out into the water table, as water was always coming into the chamber as a result of the pressure difference.

However, in reality, the pressure could go anywhere because the reactor was not across the panel face, having followed several unpredicted paths, including back up the horizontal injection well where it was struck during the drilling of the second vertical well. The hydrostatic pressure was not known. The water report submitted to the government was tendered without a definite baseline, permitting flexibility as to authorised levels. Even estimations of hydrostatic pressure levels were exceeded, especially when trial results were needed for Australian Stock Exchange announcements in regard to targeted gas production rates. It was also consistently exceeded when the failing vertical injection wells—the first and especially the last one—would not establish an air path to connect with the reactor. The result of these activities would be the driving of contaminants into the water table, and that is a matter of considerable concern.

Secondly, there is the reactor shutdown process, which required that the panel would be shut down by a process that flushed steam across the panel reactor face and steadily lowered the chamber pressure until the gas coming up the product well proved that there was no more production or remaining contaminants in the chamber. In reality, a number of unstructured reactor chambers linked by a number of unknown paths simply died by ceasing to produce gas. When the production air was turned off, groundwater would have entered and exited in an uncontrolled manner via multiple points along the faces of the chambers and any associated linking fissures.

The problem here is that, if these assertions are true, contamination of the groundwater is indeed possible. There is possible continuing contamination underground which has not been removed. The reactor that was supposed to produce energy got out of control. These are matters of considerable concern, and many people on the Darling Downs have a great deal of concern about the rapid spread of the coal extraction process that this involves. It is a matter that should be under public investigation and I hope the Queensland authorities are well acquainted with these facts in the ongoing investigation.