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Energy Crisis.

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Gas rich Victoria to import gas..
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A report from Robert Gottliebsen in The Aust today.

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Getting gas-rich Vic to import costly LNG is ludicrous

I have obtained access to one of the most secret, but nation-changing documents in Australia – the Exxon estimates of Victoria’s massive low-cost, onshore, likely carbon neutral gas reserves that do not require fracking.
They are near the Longford, Gippsland, treatment plant and the east coast pipeline network. The best-case Exxon estimate is that the reserves total 4.996 trillion cubic feet (TCF) of gas or some 60 per cent of the last 50 years of Bass Strait production.
But there is a “high” estimate of reserves at 12.6234 TCF that makes the Victorian reserves second only to the North West Shelf.

The “secret” report titled ‘Onshore natural gas from lignite’ was prepared in 2014 by Gippsland Gas (then chaired by John White who was the chief executive of the company that won the contract to build the ANZUS frigates) and Exxon.
It was based on Exxon’s Houston researchers’ extensive technical review of the Gippsland Basin.
Houston studied oil exploration wells that been drilled in the 1950s and 1960s (some by Woodside) plus drilling conducted in earlier decades to map brown coal reserves.

Exxon found that many of these wells had encountered gas dissolved in water deep below the normal aquifers.

At the time, the drillers did not value the gas.
Exxon then took their Houston research to world-renowned gas and oil reserve estimator MHA Petroleum Consultants, now part of the giant Sproule group.
The MHA estimated a potential gas reserve bonanza, which now could replace the requirement to develop more expensive gas in Bass Strait.
The Gippsland Gas/Exxon revelations were first disclosed to the Denis Napthine Coalition government before the 2014 Victorian election.
Scared of Green votes, Napthine kept the lid on the discovery.
The ALP’s Daniel Andrews became premier after the election and banned further exploration and development of the gas, again for green reasons.
To conceal its existence, he spent large sums on an “expert” committee commissioned to check whether there was any likelihood of discovering onshore gas in Victoria.
The committee was forbidden to look at the area covering the massive Exxon discovery and other promising gas areas and dutifully reported that there was unlikely to be onshore gas in Victoria.
The local press, often with deep green views, did not disclose the obvious community deceit.
The Gippsland Gas and Exxon report told the government that water produced from the lignite could be used in agricultural activities to help grow carbon-absorbing plants “to a promote zero net emissions framework”.

Woodside, which is now a joint venture partner with Exxon, last week called for more exploration in Victoria, presumably knowing that the required gas has already been found by its Bass Strait partner and the reserves estimated by MHA.
Woodside say that if Victoria cannot explore for gas, then the only alternative is, what I regard as one of the most ludicrous proposals ever conceived in Australia – that gas-rich Victoria import high-cost liquefied natural gas.
The Victorian government itself wants gas being exported from Queensland to be sent to Victoria and NSW in the full knowledge that, subject to the tests, the state’s abundant low-cost gas can supply domestic demand on the East Coast of Australia.
And the Victorian gas, unlike Queensland, does not require fracking.
However I emphasise that the Gippsland Gas/Exxon report reveals that further work needs to be done, not to determine the reserves, but to make sure that production and permeability will duplicate the first test wells.
But they were so confident that they planned to spend $200m (in 2014) on the project, arranged for BlueScope and other major gas users to pencil intent contracts and signed six agreements with local landholders who would benefit from the development.

Those Gippsland farms would have become droughtproof had the gas development proceeded.
The report sets out that Exxon planned to drill six holes to test for gas saturation and coal permeability.
Each well would have taken between two and four weeks and a detailed drilling plan been established.
But faced with the antics of the Victorian government, Gippsland Gas and Exxon concluded that developing the gas was just too hard and they had better things to do.
As result, the leases are now owned by the Victorian Government.
Australia-wide the Greens do not want any more gas development and there will be similar sentiments in the inner suburbs of Melbourne.
But subject to the saturation and permeability tests, Australia has gas reserves with production costs at a small fraction of the current price.
Release of this gas would save large numbers of Australian industrial companies and slash the cost of gas to consumers on the east coast, reducing Australia’s inflation.
Snowy Hydro has now been forced to restrict using its gas-fired power stations.
These could be resumed and provide valuable back-up to make renewable energy more reliable.
And although it’s heretical to mention it, a new gas-fired power station that can be turned on when renewables are interrupted would enable massive reductions in carbon because Yallourn brown coal would be shut down much faster that is currently likely.
 
The liberals sold of gas, made no money from mining and now we suffer.
 
I'm not a liberal supporter but I thought the gas problem started with Krudd and Gillard?
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Nope. The state liberals sold off our power.
The Howard government refused to tax the mining industry and basically sold off our resources for nothing.

Other countries taxed mining companies, invested the money and are set up for life.
Liberals work for big business not for the interest of Australia.
 
Nope. The state liberals sold off our power.
The Howard government refused to tax the mining industry and basically sold off our resources for nothing.

Other countries taxed mining companies, invested the money and are set up for life.
Liberals work for big business not for the interest of Australia.
I can remember an article where the then treasurer Wayne Swan was to tax the gas miners on their profits, so the companies just moved their profits off-shore and no tax was paid, Mr Swan should have taxed them per megalitre produced instead......they were too smart for him.
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Funny how Australia has just a handful of coal fired power station but somehow we are going to save the world, Fhina has 1000 and is building more..
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Beijing's dirtiest secret: With 1,000 coal-fired power stations (and climbing) China's energy pollution mocks the world's bid to combat climate change - as series of Mail exposes reveals​

By DAVID ROSE FOR THE DAILY MAIL

PUBLISHED: 07:00 AEST, 25 September 2021 | UPDATED: 00:18 AEST, 26 September 2021



The billowing clouds of steam and smoke are visible from miles away. As night falls and the lights turn the sky neon bright as far as the eye can see, the chimneys keep remorselessly pumping out their toxic fumes.
This is the Ningdong Energy and Chemical Industry Base, one of the biggest industrial complexes in the world.
Sprawling in semi-desert far to the west of Beijing, it covers an area so vast — 341 square miles, more than two thirds the size of Los Angeles — it is almost unimaginable.
Pupils cover their noses after school in heavy smog on December 23, 2015 in Binzhou, China

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Pupils cover their noses after school in heavy smog on December 23, 2015 in Binzhou, China
Much of The Base, as it is known locally, is home to mines, which produce 130 million metric tonnes of coal a year — about the same as the annual total dug from all 233 deep mines still in use in Britain when coal was our biggest energy source in the 1970s.
The coal — the most polluting of all fossil fuels — is fed into an array of huge power stations at the complex, which have the capacity to generate 17.3 gigawatts. That would be enough to satisfy a third of the UK’s peak demand for electricity.
Also to be found at The Base are 32 companies that use coal to make chemicals, so generating still more carbon pollution.
And on top of all this is the showpiece: the world’s largest coal-to-liquid (CTL) plant, run by the state-owned Shenhua Ningxia Coal Industry Group.
Simply burning coal is dirty enough, producing more carbon dioxide than any other method of generating electricity — almost twice as much as burning natural gas. But making oil from coal is far worse: it can double the amount of CO2 pumped into the atmosphere from every unit of energy.
Yet China’s Shenhua group — now restructured as part of China Energy — has been investing heavily in this hugely polluting CTL plant.
No Western journalist has ever been allowed to visit the site. But in 2017 a Chinese researcher, Xing Zhang, was given a tour by the firm’s vice chairman, Dr Yao Min.
Her findings, written up in a blog for the International Energy Agency (IEA), revealed that Shenhua had by then invested 55 billion yuan — or £6.2 billion — in the CTL plant alone. Each year, the plant turns 20 million tonnes of coal into four million tonnes of oil products; 2.7 million tonnes of diesel; a million tonnes of naptha petroleum; and 340,000 tonnes of liquid gas.
And The Base is not China’s only large CTL plant. There are at least six others in the country that are already built or under construction — and China says it plans to build still more in nations where it has lavished investment, such as Pakistan.
Since 2018, our emissions have continued to fall while China¿s have increased

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Since 2018, our emissions have continued to fall while China’s have increased
From 1990 to 2019, China¿s accumulated emissions amounted to 167 billion tonnes of CO2. Britain¿s were just 14 billion tonnes

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From 1990 to 2019, China’s accumulated emissions amounted to 167 billion tonnes of CO2. Britain’s were just 14 billion tonnes
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By 2018 China was well ahead, with 6.84 tonnes of CO2 emitted per capita, against 5.3 tonnes in Britain
Yet The Base accounts for just a fraction of China’s coal dependency. Its coal power station fleet grew five-fold between 2000 and 2020, and now accounts for almost half the world’s consumption — more than three times its closest rival, the U.S. It is said to have 1,080 separate plants with a total capacity last year of 1,005 gigawatts — and is building more.
Britain, in contrast, has just four coal-fuelled plants left, with a joint output of 5.4 gigawatts. This week, in his apocalyptic climate change speech to the United Nations, Boris Johnson urged China — by far the world’s worst emitter of greenhouse gases, producing as much as 28 per cent of the global total — to end its domestic use of coal.
Mr Johnson is only too aware that if Cop26, the UN climate conference to be held in Glasgow in November, is not to be regarded as a dismal failure, China must be persuaded to make meaningful cuts in CO2 emissions.
But far from carbon emissions slowing down in China, they are increasing ever more rapidly.
This is a country with a mind-boggling pace of development. Between 2011 and 2013, China used more cement than the U.S. did in the entire 20th century. It produces almost 60 per cent of the world’s steel and its oil refinery capacity has tripled since 2000.
Even though it promised last week to stop building coal power stations abroad, China continues to do just that at home. Last year, its coal-powered capacity rose by 38 gigawatts, while the rest of the world cut capacity by 17 gigawatts.
China has a further 105 gigawatts of new coal capacity in the construction pipeline — more than the entire generating capacity of the UK from all sources, including nuclear and renewables.
Last month, the Workers’ Daily reported that in coal-rich Inner Mongolia, 38 mothballed coal mines have been reopened, with an annual production of 60 million tonnes. Last year, Inner Mongolia dug up more than a billion tonnes of coal — and this did not even make it China’s biggest coal province: that honour belonged to Shanxi.
 
Nope. The state liberals sold off our power.
The Howard government refused to tax the mining industry and basically sold off our resources for nothing.

Other countries taxed mining companies, invested the money and are set up for life.
Liberals work for big business not for the interest of Australia.
Interesting view. Norway did very well investing profits from its oil drilling and is in a good financial position. Australia has a Future Fund which as of the March Quarter this year has assets of $201 billion which makes it something of great value that we all own. It was funded largely from the sale of Telstra - Keating sold the Commonwealth Bank at $5 a share (now worth over $90) and we've got nothing to show for it. The fund has a target growth of just over 6% but generally exceeds that.

As to the mining industry Australia makes a fortune (you could argue we should make more but we certainly haven't given it away for nothing). Aside from the employment (the industry provides a lot of well paying jobs - many $200k +) which leads to more taxes, general spending in a community surrounding mines and helping local small businesses, the bottom line of the Australian budget depends heavily on the price of our mineral exports. Chalmers acknowledged this in his update yesterday - it's a huge saving grace in our current economic difficulties and is reducing our budget deficit by a significant amount. The state governments of NSW, Queensland and WA couldn't function without their mining royalties. Add to that all our superannuation funds are making a fortune from their mining shares so with compulsory superannuation most of us a benefitting.

Overall I'd agree with the view that we could have driven a tougher bargain particularly in the current climate. But to say we are giving it away for nothing is just plain wrong.

As to selling off power assets that's a different question. Governments of both political persuasions have sold off just about everything governments own so we are stuck with the situation. I think it was a mistake to sell some of the assets but we can't unscramble that egg.

Cheers
 
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To those who think we need to take more from resource companies in tax, exploration costs are massive as is building a working mine, the resource scene in this country comes about by investors who keep stumping up in cap raisings for smaller companies to survive and keeping drilling to find something economic to mine, then you have the govt red tape and native title hurdles to overcome all the while burning investors cash, take gold mining for example, the cost of drilling to find and then prove up a economic resource is massive and long winded, diamond core drilling costs 200$ per meter with some holes needing to go 400 meters or more , anybody thinking its easy needs to pull the wallet out and try investing in a resource spec.
 
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