Department of State Development

Find out the facts about fracture stimulation and how it can be used to unlock the full potential of South Australia's resources.

Decades of experience in South Australia has demonstrated fracture stimulation to be safe and compatible with multiple land use, at more than 750 well locations in the Cooper, Officer and Arrowie basins in the north of South Australia.

Fracture stimulation is a process that reaches oil and gas deep beneath the earth's surface, using a high-pressure mixture of water, sand and a small amount of additives.

The mixture and pressure cause the rock to fracture. Oil or gas that had been trapped in the rock flows into the cracks, and then to the wells and up to the surface.

The impact to the surface and deep underground is minimal. The surface foot-print for deep gas wells are smaller than for shallow coal seam gas extraction and fewer wells are required as deep gas wells flow at higher pressure than shallow wells.

Fracture Stimulation Diagram

The deep gas reserves in South Australia are quite different to the shallow intensive coal seam gas (CSG) reserves found in Queensland and New South Wales.

South Australia’s prospective gas resources are deep – predominantly 2-4 km below the surface – are separated from fresh water supplies by impermeable rock layers, and hence pose significantly lower potential risks to shallow aquifers.

Fewer wells, pipelines and roads are required to produce deep gas at high pressure than are required for the development of shallow coal seam gas.. Multiple wells can be drilled from a single pad into a deep gas resource, greatly reducing the surface footprint which ensures minimal impact on the environment above ground and on underground water supplies.

Shallow coal seam gas resources, as explored for and developed in Queensland and New South Wales, are of lower pressure and generally located at depths less than 1,000m below surface.

Cooper Basin in SA and Qld

Shales, siltstones, tight sandstones and deep coals

Deep gas targets 2,000 to 5,000m

Remote and separated from potable water resources

Modest surface footprint as well drilled from pads with single road and flow-line into multiple wells

Fewer wells required than for shallow coal seam gas

Land access enabled with risks well managed

Vs

Surat-Bowen basins, Qld

Shallow coal seams

Gas at less than 1,000m

Close proximity to potable water resources

Can be an expansive surface foot-print

Associated with thousands of wells

Land access enabled with risks well managed

Vs

Several basins, NSW

Shallow coal seams

Gas at less than 1,000m

Close proximity to potable water resources

Can be an expansive surface foot-print

Associated with thousands of wells

Land access very limited with manageable risks

All South Australian fracture stimulation operations have to date been restricted to the Cooper, Officer and Arrowie basins in the north of South Australia.

To date, there are more than 750 fracture stimulated wells in the State, predominately in the Cooper Basin.

In 2013/2014, the Cooper-Eromanga basins produced and generated 17.4% of Australians oil production.

200 tcf gas
= 200 year supply

Early indications show that the Cooper Basin could potentially produce more than 200 trillion cubic feet. That's more than two centuries of supply if used in Australia alone.

700+

Fracture stimulated wells*

The Cooper-Eromanga basins are Australia's leading onshore oil production basins and generates 17.4% of Australia's oil production (2013/2014).

Santos's Moomba 191 shale well in the Cooper basin is Australia's first commercial unconventional gas well, which started flowing gas in October 2012.

$42 Billion

The South Australian Cooper-Eromanga basins have produced more than 5 trillion cubic feet of gas and more than 340 million barrels of petroleum liquids since 1969 with a present sales value of $AUD 42 billion*.

* To end June 2014

Fracture stimulation has been safely used to enhance flows from both conventional and unconventional reservoirs in more than 750 wells in South Australia since 1969. There is no evidence of adverse impacts on aquifers within the Great Artesian Basin and other shallower aquifers from these fracture stimulation operations.

Fracture stimulation has been used safely in South Australia since 1969, in both conventional and unconventional wells.

More than 750* wells have been fracture stimulated in the north of South Australia, predominately in deep sandstone reservoirs of the Cooper Basin in South Australia.

No fracture stimulation is allowed without detailed assessment to inform stakeholders ahead of consultation.

Fracture stimulation has been used safely in South Australia since 1969, in both conventional and unconventional wells.

More than 700* wells have been fracture stimulated in the deep sandstone reservoirs of South Australia’s Cooper Basin.

No fracture stimulation allowed outside the Cooper Basin without detailed assessment to inform stakeholders ahead of consultation.

45
Years of fracture stimulation
(fracking) in South Australia
0 Negative impacts identified

Water resources

Soil

Native vegetation and fauna

Landscape and heritage

Air quality

Health and wellbeing of people and enterprise

Explorers are searching for viable gas plays in other regions – the Officer, Pedirka, Arckaringa and Warburton basins in the far north, and the Otway Basin in the south east.

Map of South Australian unconventional basins

No fracture stimulation operations have been proposed in the South East of South Australia.

Prior to any well operations being approved, appropriate baseline studies must be undertaken. As part of these studies the existing overall health of the environment needs to be evaluated.

Until a proposal is made and the process pursuant to the Petroleum and Geothermal Energy Act 2000 (PGE Act) is followed to demonstrate how all significant risks (identified in consultation with all potentially affected stakeholders, including the public) will be avoided, fracture stimulation is not permitted in the South East.

South Australia has vast, prospective natural gas in unconventional reservoirs that could ensure our State's sustained well-being for decades to come. In 2013, 52% of the State’s electricity was generated from natural gas.

There is increasing evidence that using gas as an energy source is much better for the environment than using coal.

According to the Energy Information Administration (EIA) and other estimates, the Cooper Basin alone is estimated to contain more than 200 trillion cubic feet of recoverable gas in unconventional reservoirs, or enough to supply Australia for 200 years.

Fracture stimulation provides an economically viable way for petroleum companies to access South Australia’s gas reserves. It is regulated using best practice frameworks for environmental protection and petroleum production has generated more than $42 billion dollars for our State’s economy.

Wells drilled and fracture stimulated from 1969 to 2014

Wells drilled from 1969 -2014

International evidence and the experience in South Australia since 1969 demonstrate that fracture stimulation can occur in our oil and gas fields without harm to social, natural and economic environments.

In South Australia, recognised, leading-practice, industry standards are used for all upstream petroleum operations, in order to manage all potential risks in ways that meet community expectations for outcomes. No petroleum projects are allowed to commence unless it can be demonstrated to regulatory authorities that these standards can and will be met.

Under South Australian legislation it is an offence to contaminate or adversely affect aquifers as a result of petroleum exploration and production activities.

There is no evidence to date that fracture stimulation in Australia has led to any serious environmental contamination or harm.


Since 1969, fracture stimulation in South Australia has been proved to be safe and without harm to social, natural or economic environments.


100+Wells
100Years

Over 100 oil and gas exploration wells have been drilled over the last 100 years in the Limestone Coast region which successfully co‑exists within a strong agricultural area.

Risks associated with fracture stimulation are considered to be similar to conventional drilling.

The mixture used in fracture stimulation in South Australia is more than 99% sand and water. The small amount of other additives – approximately 0.5% of the total mixture – is made up of chemicals commonly used in hair products, food processing and household cleaning products.

Fracture fluids are required (using a mix of water, sand and additives) to improve movement within pipe, stop the growth of bacteria, clean the well and remove oxygen to prevent corrosion.

Water and sand 99.51%

Additives0.49%

Commonly found in

Household cleaning products

Hair products

Food additives

On average, fracture stimulation uses around 7.5 megalitres per well. This equates to about three Olympic swimming pools or the volume required to produce 10 tonnes of wheat.

As part of petroleum development, companies must use water sources in ways that minimise all negative impact on other water users, including water required for agricultural and environmental needs.

Water use must be under taken in accordance with principles set out in the relevant Regional Natural Resource Management (NRM) Plan and the relevant Water Allocation Plan (WAP).

South Australian law prohibits any drilling or well operations that will contaminate underground aquifers.

Prior to any well operations being undertaken such as fracture stimulation, appropriate baseline studies must be undertaken. As part of these baseline studies the existing overall health of the environment needs to be evaluated, including shallow aquifers.

In South Australia, fracture stimulation in deep gas resources pose significantly lower risks to shallow aquifers, as these resources are located2-5 km below surface, which is quite different to the proximity of shallow coal seam gas resources to potable aquifers in Queensland and New South Wales. Coal seam gas targets in Queensland and New South Wales are located less than 1km below surface.

Historical evidence demonstrates that farming and petroleum exploration and production can and does co-exist in South Australia.

The Limestone Coast region in the South East of South Australia has a long history of gas exploration and production compatibly coexisting within strong agricultural operations. Indeed, more than 100 oil and gas exploration wells have been drilled over the last 100 years in this region without deleterious impacts on social, natural and economic environments. No damage to water is evidenced from this long history of petroleum exploration and production operations.

The South Australian Government recognises that people feel very strongly about their land and the homes and farming activities that may occur on it. It works closely with local communities to identify potential issues and ensure any project application addresses these issues.

While some interruption of very local farming activities must occur during petroleum well operations, the ‘footprint’ for petroleum operations is small and petroleum well bores are largely no more than the diameter of an A4 piece of paper.

The hole drilled in the ground is equal to the width of a standard A4 page.

The Petroleum and Geothermal Energy Act 2000 states that approval can only be given once the company can demonstrate that all risks to the health and safety of the community and to the environment are either completely avoided, or reduced to a level that is as low as reasonably practicable and acceptable to the community and other land users.

This process requires extensive consultation with stakeholders including land owners, cultural heritage and native title groups, community groups and government agencies.

The Department of State Development carefully assesses each project application on its merits to ensure that only environmentally sustainable projects are granted land access.

To ensure protection of potable aquifers and hence other land users’ access to that water, the approval process also requires that background sampling and analysis of aquifers are undertaken before drilling activities commence.

Regular ongoing sampling is then undertaken at appropriate intervals to demonstrate that no contamination is occurring. Furthermore, prior to the completion of the well, the licensee must demonstrate that cement integrity behind the casing is adequate

Recognised industry best practice for facility integrity and safety must be adhered to in well design, construction, maintenance, and monitoring to ensure there will be no loss of containment that may result in contamination of the environment, including water supplies, soils, flora and fauna.
Casing and cement are pressure tested for leak-tightness before wells are put to use.
Operators monitor the containment of wells using high-tech monitoring tools during the fracture stimulation process and ongoing integrity testing.

In South Australia, all oil and gas exploration and production activities are regulated by the Department of State Development under the Petroleum and Geothermal Energy Act 2000 (PGE Act).

The objectives of the PGE Act and its Regulations are to ensure that all risks to the health and safety of the community and to the environment are either completely avoided, or managed and reduced to a level that is as low as reasonably practicable and acceptable to the community.

All activities regulated under the PGE Act are also subject to the provisions of other state environmental regulation such as the National Parks and Wildlife Act 1972; the Natural Resources Management Act 2004 (NRM Act); the Work, Health and Safety Act 2012; and the Environment Protection Act 1993. This in turn creates another layer of protection.

The PGE Act and its associated Regulations can be readily accessed through the South Australian legislation website www.legislation.sa.gov.au.

South Australia has been independently assessed as one of the top three resource regulatory regimes in the world for shale and tight gas by international mining and energy law expert Dr. Tina Hunter.
Legislation & Regulations
  • Petroleum and Geothermal Energy Act 2000
  • PGE Regulations 2000
  • National Parks and Wildlife Act 1972
  • Natural Resources Management Act 2004
  • Work Health and Safety Act 2012
  • Environment Protection Act 1993
Licence

Risks must be reduced to as low as reasonably practicable using international standards

Regulated activities under the PGE Act cannot be carried out unless there is an approved Statement of Environmental Objectives (SEO) in place, prepared on the basis of an Environmental Impact Report (EIR).

The EIR identifies all potential risks relating to the activity and describes the appropriate risk mitigation strategies.

The SEO identifies the environmental objectives to be achieved and the criteria to be used to assess achievement of the objectives.

These documents are required to be developed in consultation with potentially affected stakeholders (including farmers) with the right to be consulted with and to raise any issues and concerns (including those associated with other uses of the land).

A comprehensive and extensive public consultation process is then undertaken in relation to SEOs to demonstrate how all risks are addressed to as low as reasonably practicable.

Only when community concerns have been adequately addressed and all significant risks are effectively managed does the government then consider granting approval.

A timely notice of entry must also be provided to landowners in regards to land access conditions, and terms for entry to land include compensation for any deprivation or impairment of the use and enjoyment of the land.

Under the Petroleum and Geothermal Energy Act 2000, approval will only be granted once the community are adequately satisfied that all risks to the environment, other land users and the precious water resources are manageable.

The notice of entry to land process also provides the landowner with rights to dispute entry and to seek resolution on terms of entry.

The legislation also states that companies must make sure potentially affected people, enterprises and organisations are provided with all the relevant information necessary to reach informed views before any approvals can be made.

The South Australian Government has established the Oil and Gas Roundtable to ensure all people affected by oil and gas operations – from residents and farmers to geologists, environmentalists, academics and regulators (for all forms of social, natural and economic environmental protection) – are updated and can comment on proposed activities.

No petroleum operations are allowed without stringent assessment.

Operators must give timely notice of entry to affected landholders.


14Years
14,000notices of entry issued for operations
0

legal objections from people or enterprises

Strict monitoring, reporting and regular maintenance based upon recognised, leading-practice industry standards are imposed on licensees to demonstrate compliance with regulatory requirements.

Licensees must also demonstrate compliance with relevant Statement of Environmental Objectives (SEOs). This includes public access to risk management strategies and industry performance outcomes.

Furthermore, timely and effective notice of entry to inform potentially affected people, enterprises and organisations must be given – and is open to a dispute resolution process that culminates in a court of law. Fair compensation is required to be paid to affected people, enterprises and organisations both to be able to reach informed views, and to offset any loss or deprivation. All these steps must be concluded and agreed upon before an activity commences, or activities are not allowed to be undertaken.

If these conditions are not met then the government can impose regulatory enforcement sanctions.

Regular maintenance, sampling, monitoring and reporting

Public access to risk management strategies and industry performance outcomes

Timely notice of entry for all affected stakeholders

Fair compensation to affected land-owners

Regulatory Enforcement
  • Prevent and stop specific operations
  • Request restitution or rehabilitation
  • Levy fines
  • Cancel licence
  • Prosecute
  • Inspections for compliance
  • Mandatory reporting

Visit http://petroleum.statedevelopment.sa.gov.au

The South Australian State Government's submission to Parliament's Natural Resources Committee (NRC) Inquiry into Unconventional Gas (Fracking)
Download PDF | 1.7MB
View the Public Information Guide for facts about natural gas and fracture stimulation in South Australia
Download PDF | 2.7MB

For FAQs on gas and oil in unconventional reservoirs and fracture stimulation in South Australia, visit: Unconventional Gas FAQs

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