NEWS
NEWS
KUNUNURRA, WESTERN AUSTRALIA — (July 15, 2020)
An American-owned oil and gas company says its extensive experience with fracking in the United States puts it in a strong position to kickstart an unconventional gas industry in Western Australia’s Kimberley region.
Bennett Resources, a subsidiary of Texas-based Black Mountain, announced yesterday that it had submitted its referral to WA’s Environmental Protection Authority to assess plans to drill and frack six wells on its newly acquired acreage on Noonkanbah Station, near Fitzroy Crossing.
The Government announced it was lifting its moratorium on fracking in November 2018 at the conclusion of the WA scientific inquiry, which found fracking posed a low risk to human health and the environment.
Black Mountain chief operating officer Ashley Zumwalt-Forbes said the company was excited at the prospect of having the first fracking program since the moratorium was lifted.
ASHLEY ZUMWALT-FORBES
“Collectively the team has drilled and fracked over 2,700 wells across the US and internationally.
“I view us very much as technical experts who roll out industry best practices and have a very safe, efficient campaign.”
The US Energy Information Agency reported in 2013 that the Canning Basin, which covers 530,000 square kilometres of the Kimberley and Pilbara regions, has the largest unconventional gas potential in Australia, and the eighth largest in the world.
Ms Zumwalt-Forbes, a former manager with ExxonMobil, said fracking unconventional gas in the basin could help address energy shortages in eastern Australia.
ASHLEY ZUMWALT-FORBES
“But we realised there’s a real opportunity to produce more gas locally and get it into the domestic market, particularly right now with all this discussion around the possibility of a west-east pipeline.
“Piping gas from the Canning Basin to the east coast of Australia will provide a level of security of supply and price that simply can’t be matched by LNG imports.”
There has been a lot of speculation about the feasibility and cost of building a trans-Australia gas pipeline over the years, with the idea recently put back on the agenda by the Federal Government.
It’s hoped a proposal to link the gas fields in northern WA to manufacturers along the east coast could snap the economy out of a post-pandemic funk.
Ms. Zumwalt-Forbes said although the eastern states were Black Mountain’s preferred target market, the project’s success was not dependent on a trans-Australia pipeline being built.
She said there was also an opportunity for Canning Basin gas to flow south to the Pilbara to existing LNG facilities on the North West Shelf as well as identifying potential international export markets.
Bennett Resources plans to begin a seismic campaign over its acreage EP 371 during the next 12 months, with drilling expected to start by 2022.
The proposed fracking program follows on from previous unconventional gas exploration by Buru Energy and Mitsubishi in 2015.
Ms Zumwalt-Forbes, a former manager with ExxonMobil, said fracking unconventional gas in the basin could help address energy shortages in eastern Australia.
Ms Zumwalt-Forbes said that program was undertaken with the full support of the Yungngora and Warlangurru traditional owners from Noonkanbah Station, who have also recently signed agreements with Bennett Resources.
“Thomas Skinner, a member of the Yungngora traditional owner group, was quite influential in getting the initial moratorium raised and the folks who actually live … where we intend to operate have been nothing but incredibly supportive of the project,” she said.
Mr Skinner has been contacted for comment.
He told ABC after the moratorium was lifted in 2018 that fracking exploration would open economic opportunities for local people and would be welcomed by the community as long as companies acted responsibly.
This relationship is in stark contrast to the 1970s, where a clash between the Noonkanbah community and a different oil company led to riots and strikes.
Fracking has been a sensitive issue across Australia and particularly in the Kimberley with concerns over how the practice of hydraulic fracturing could negatively impact the environment and water resources.
Kimberley Frack Free Coordinator Shaun Clark said it was inappropriate to push ahead with a proposal in the region before the State Government had finalised the new Code of Practice laws and reforms to oversee hydraulic fracturing activities in WA.
Lock the Gate Alliance spokeswoman Simone van Hattem said this proposal to frack in the Kimberley was out of step with community sentiment.
“All across this state, communities at risk of fracking have been loudly and proudly declaring themselves ‘gas field free’,” she said.
“This company will have a serious fight on its hands if it truly proceeds with plans to frack this iconic part of Australia.”
Roberto Aguilera, an energy economist at Curtin University, said on face value Bennet Resources’ proposal looked promising.
“There has been some activity in the Canning Basin by adventurous smaller companies that were backed by bigger international players but that was nearly 10 years ago,” Dr Aguilera said.
“The difference now is there has been much experience acquired in the US shale sector, so a company that has that experience in terms of assessing the resource and applying the technology to economically extract the resource would have an advantage today.
ROBERTO AGUILERA
Energy Economist at Curtin University
But Dr Aguilera said there would still be a lot of financial, logistical and social licence challenges for Bennett Resources to get a project up and running in the remote Kimberley.
“There’s no doubt that in a remote region like the Canning Basin the production costs are going to be higher than what they are in the US where there is very developed infrastructure,” he said.
“But we’re also dealing with a higher priced environment compared with the US that means that price would probably cover the costs — whether we’re talking about the price of LNG in Asia or the higher natural gas prices on the east coast if it were to be delivered over there.”
Dr Aguilera said although the future of the five-billion-dollar pipeline proposal was uncertain the volumes of unconventional gas available and potential shortages of LNG over time would allow such an investment to prove its worth over the decades to come.
However, he acknowledged social licence challenges and its impact on government policy could also be a limiting factor on the continued expansion of an unconventional gas industry in Australia.
Ms Zumwalt-Forbes agreed the oil and gas industry needed to do a better job of educating the public about fracking.
“I live in Fort Worth, Texas, which is probably the best example of fracking that has been done in an incredibly responsible way in an urban setting,” she said.
“You can certainly expect us to be open and transparent with decisions and timelines and everything down to what we’re pumping down hole.
“I intend to prove that to the local community, in the Kimberley, and more broadly to Australia.”
Fracking is still banned across 98 per cent of WA, with exploration permits only allowed on existing petroleum leases in the Kimberley, adjacent to the Dampier Peninsula area, an area north-east of Carnarvon, and an area between Geraldton and Gingin.
National parks, the Dampier Peninsula in the Kimberley, and public water source areas have also been declared off limits to fracking.
A range of proposed reforms, including veto powers giving landowners and native title holders rights to refuse fracking, are yet to be legislated in parliament.
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