Coal Seam Gas

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CSG is a naturally occurring methane gas which is known as Coal Bed Methane (CBM). It is a-by product of ancient plant matter that has formed over millions of years by the same natural processes which produce coal. Not long ago this gas was identified as a major problem in the underground coal mining industry due to it’s high flammability despite this, it is now recognised as a very profitable resource.

The coal seams are generally filled with water and it is the pressure of the water that keeps the gas as a thin film on the surface of the coal. A combination of water and ground pressure traps the gas in the fracture of the coal seam.

As an end-use product, CSG is the same as natural gas. In Australia it is used in natural gas appliances such as heaters and stoves it is also used in various industries for the generation of electricity.


Coal seam gas is recovered by drilling a well (borehole) into the coal seam and fracturing it with high-pressure water and sand. Water is then pumped out, leaving the sand in the small fractures. The sand keeps the fractures open, allowing gas to flow from the coal seam to the well.

An operating coal seam gas field involves a network of gas production wells connected to a buried pipeline system that transports the gas and produced water to a central processing facility before sending it on to the market.


A 280-KILOMETRE pipeline from Coolah (a small rural town situated four hours north-west of Sydney) to supply the State's first liquefied natural gas export terminal in the Port of Newcastle will make numerous crossings of creeks and rivers in its path through the Hunter.

A project application lodged with the NSW Department of Planning, said that the high-pressure gas pipeline would stem from the Narrabri to Wellington pipeline adjacent to Coolah, linking the proposed terminal at Kooragang Island to the company's Narrabri coal seam gas project.

The pipeline to Newcastle would run from Coolah, crossing the Hunter River for the first time east of Denman, cut through Lake Liddell and travel through the areas of Dyrring, Mitchells Flat, Elderslie, Stanhope, Hillsborough, Gosforth and Maitland Vale, before passing through Largs, Morpeth, Woodberry, Tarro and Hexham. The pipeline would cross seven highways and five railway lines it would also supply natural gas to Hexham, which would enable it to tie into the existing NSW gas grid and improve security of supply for Newcastle and Sydney.

Basically CSG deposits can be found wherever there are coal reserves. In NSW these reserves stretch from Casino in the far north through the Gunnedah Basin and into the Hunter Valley and Blue Mountains. Coal resources continue through the Sydney Basin and into the Southern Coal Fields around the Illawarra and Central Tablelands. Nearly all of this area, including under the sea between Sydney and Newcastle, is subject to petroleum exploration licences. The vast majority of the NSW population lives on top of coal reserves.


The coal seam deep within the drilled borehole contains water as well as methane gas. The gas is trapped within the coal seams by the pressure of the surrounding water, so to extract gas the water must first be pumped out. This means that large quantities of water are normally an inevitable by-product of coal seam methane gas production.


This water has been underground for a long time, particularly in the deeper seams. Since it is effectively trapped in layers of solid rock, very little fresh water has penetrated over time. As a result, the water has taken some of the chemical properties of it’s porous surroundings and is often quite salty. Of the dissolved salts present in the water, sodium is the most prevalent.

This has particular implications if using the water for...
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