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Gladstone LNG - The CSG Story

by Steven Randall

 This aerial view of Curtis Island off Gladstone gives us a very visual insight into what $90 Billion looks like in the LNG industry.


This is the Coal Seam Gas story - the resources that is bringing one of the largest gas industry production sites in the world.. 

 In very simple terms, Coal Seam Gas is natural gas that exists in the large reserves of coal deep underground, and is released by drilling wells 300 - 600 meters deep, then fitting wellheads to the holes and drawing gas off.    Shale Rock is the material (very hard in nature) that often requires cracking open the seams or deposits of coal, usually with very high pressure fluids or chemicals - a process we might know as Fracking.

Australia has large reserves of coal seam gas, especially in Queensland, New South Wales and Victoria, while large shale gas deposits exist across the Northern Territory, South Australia and Western Australia.

Coal Seam Gas is currently being extracted from the Bowen and Surat Basins in Queensland and the Camden Valley in New South Wales, with numerous exploration wells across the Liverpool Plains and Hunter Valley.

The first complex to consider is the Australia Pacific LNG plant on Curtis Island.  

Australia Pacific LNG is a joint venture project between Conoco Phillips (37.5%), Origin Energy (37.5%), and Sinopec (25%). The project is developing Australia's largest position of coal seam gas (CSG) resources, which have a life expectancy of up to 30 years, and has an initial budget of over  A $24 Billion.

There are two off take agreements for the LNG, 7.6 mtpa to JV partner Sinopec, and     1 mtpa to Kansai Electric, both for 20 years.    Facilities like this new regasification plant ..

owned by Sinopec in Shandong China,  will take much of this new LNG from Australia Pacific LNG, as China works hard to meet the double challenges of increasing energy needs for it's 1.4 billion people, and the rapidly growing but deadly smog seen across many Chinese cities.

Over the next 5 - 20 years China's demand for LNG will steadily increase, as they transition from coal towards cleaner fuels and renewable energy.

Kansai Electric of Japan is currently supplying power to the second largest industrial region in the nation, and is increasing it's import of LNG.


This Large capacity power station outside of Osaka is one of three run by Kansai supplying both industrial and residential clients, and being supplied with Australian LNG.

There are major questions about the current and future use of Nuclear power in Japan after the Fukushima Disaster, and LNG with be a major part of the fuel mix for power generation for many years to come.

Next time, we will have a detailed look at the other two LNG  plants at Gladstone, as we continue to explore the industry and it's global connections.


For more information about the Australian and Asian LNG industry, you can find the Asia Pacific LNG Terminals map at the link below...



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