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NSW government approves CBM flow test pilot programme

World Coal,

An exploration pilot programme to flow test gas from coal seams at Gloucester has been approved by the New South Wales (NSW) government.

AGL Energy Ltd said in a press release that it welcomed the approval as it looks to develop coalbed methane (CBM) reserves in the area.

The company confirmed that it had received approval  from the Office of Coal Seam Gas for the Waukivory Pilot and the Environment Protection Licence from the Environment Protection Authority.

Resources and energy minister, Anthony Roberts, said that the license (PEL 285) was awarded “due to AGL's performance in relation to compliance, environmental performance, safety, its financial and technical capacity and its high level of community consultation."

A spokesman for Roberts added that, since 2011, the NSW government had introduce stringent CSG regulations, which include banning evaporation ponds, as well as introducing an aquifer interference policy.

"AGL must meet the New South Wales government's strict licence conditions in relation to community consultation, groundwater monitoring and modelling, produced water management, well integrity and fracture stimulation," a statement from the minister said.

AGL will now be able to begin the Waukivory pilot to facture simulate and flow test four existing gas wells that are located within the Stage 1 area of the Gloucester gas project.

Michael Fraser, managing director and CEO of AGL, said that the pilot project was an important step in the development of the Gloucester project, which will secure a local supply of gas for NSW communities and businesses.

“We welcome these approvals from the NSW Government. At present NSW produces less than five percent of its own gas and imports the rest from interstate. However if the Gloucester Gas Project proceeds, we have the potential to bolster that locally produced gas figure to around 20 percent,” Fraser said.

Stage 1 has already been through a full environmental assessment and received approval from the independent NSW Planning Assessment Commission – this approval was further upheld by the Land and Environment Court. Stage 1 is also the subject of Commonwealth approval.

“All of the natural gas produced from the Gloucester Gas Project is for NSW customers and will not be exported,” said Fraser.

Information from the Waukivory Pilot will enable AGL to comply with the terms of the State and Federal approvals. AGL said it would conduct its operations at Waukivory in a safe manner, minimising disturbance to the local community. 

Edited by Sam Dodson

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