Research indicating that coal seam gas is a low emission energy source is being questioned — but the NSW Government told a parliamentary inquiry hearing in Sydney last week that this wasn't of great consequence in planning for the state's clean energy future.
After a week in which the reliability of the research used by both the CSG industry and NSW government to promote CSG as a clean energy option was scrutinised, Mark Paterson from the NSW Department of Trade and Investment maintained that it was "likely" that coal seam gas would produce lower emissions than coal and that it was therefore a critical transitional fuel.
When quizzed by Greens MLC Jeremy Buckingham on how much weight had been given to the question of fugitive emissions in the government's submission to the parliamentary inquiry, Paterson said it was "one small part of the overall considerations the government would have." He continued, "Is it influential in itself? No."
"We haven't modelled an unlikely proposition to inform the government's submission," said Paterson when pressed by Buckingham on what the government would do if new data indicated that CSG would produce higher than expected emissions.
Brad Mullard from the Mineral Resources and Energy office in the NSW Department of Primary Industries said that previous production in other markets indicates CSG would have lower emissions than coal.
This comes following claims last week from renewable energy research group Beyond Zero Emissions (BZE) that the NSW government is using outdated research to justify CSG as a transitional energy source.
BZE say they commissioned a report into the "true emissions impact" of the CSG industry from Worley Parsons, a company that has a multi-million dollar contract with Queensland Gas Company (QGC). BZE allege the report has been suppressed by Worley Parsons to protect their contract with QGC.
BZE said in a statement: "There is no Australian field data on fugitive emissions," and "the American Petroleum Industry data that the industry and government rely on is outdated and superseded".
Also raising questions about emissions from CSG is multi-national financial advisory group Merrill Lynch who last week warned clients to be wary of advice from the CSG industry when making investment decisions.
In a briefing document sent to clients, Merrill Lynch say that the emissions intensity of unconventional gas sources may be substantially greater than industry reports claim and that this should be considered as a factor that "may directly impact future earnings in terms of carbon liability".
"Accurate measurement is important because methane (CH4) has far greater GHG impact than CO2 itself, tonne-for-tonne. CH4 emissions arise from the initial stages of drilling, fraccing, completing and bringing a well on-line, and also from compression and potential leakage from pipelines and other facilities," the document explained.
Despite these concerns around the available research, the state government is in what Mullard described as "very advanced stages" of policy development to regulate the CSG industry. "We are looking at developing standards to make sure what we have in place in NSW is in line with global best practice," he said.
Paterson told the inquiry that the government was using the current science and had responded accordingly. Paterson referred to a state-wide moratorium on the use of fracking to stimulate gas flow, introduced in NSW earlier this year.
Mullard would not comment on whether the temporary ban on fracking, set to expire at the end of the year, would be extended.
Drew Hutton, environmentalist and president of Lock the Gate Alliance also provided testimony at the inquiry hearing in Sydney. Hutton said that public pressure for a more critical consideration of the environmental and economic viability of the CSG industry continues to mount and that imposing a moratorium while obtaining independent scientific assessment about the impact of the industry remained essential.
Hutton raised concern about the conversion of CSG into liquefied natural gas for export, saying that the process raises overall life-cycle emissions from CSG production by a further 20 per cent.
"The liquification process is heavily energy intensive," said Hutton, echoing the concerns of BZE and Worley Parsons about existing research, "A lot of APPEA's (Australian Petroleum Production and Exploration Association) research is out of date and using methodologies that underestimate fugitive emissions."
Mullard countered that CSG is a necessary and important part of the state's future energy mix, "The more gas you have, the more renewables you can have," he said explaining, "It can come on stream very quickly from shortfalls when sun isn't shining or wind blowing."
"You actually need gas."
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