In 2012, Santos’ Moomba-191 well in the Cooper Basin became the first commercially producing shale well in Australia. The Moomba-191 shale well was another milestone for Santos’ Cooper Basin unconventional gas program, which began in 2004.
The well was only 350 metres from the existing pipeline network and eight kilometres from Moomba’s gas processing plant, which enabled it to be brought on line quickly, illustrating the importance of Santos’ existing infrastructure position in commercialising the region’s significant resource potential.
Further exploration has been undertaken in the area, including an ongoing vertical well appraisal program and Santos’ first horizontal shale well.
Shale gas is natural gas. It is found in hard, dense underground rocks called shale (in the past shale was called slate).
Shale gas is odourless, colourless and mostly methane, exactly the same as natural gas used in homes and businesses.
Shale gas was first extracted in the United States in 1821, but it is only in the last decade that advances in technology have made production viable on a large scale.
As a result, shale gas has grown from 1% of the United States’ natural gas production in 2000 to over 26% today.*
The United States Energy Information Administration has estimated that Australia could have 437 trillion cubic feet of recoverable shale gas, the equivalent of over 200 years of production at current rates.
*U.S. Energy Information Administration (EIA)
The benefits of shale gas are much the same as for natural gas in general. Natural gas is widely used in electricity generation. Because it can be quickly started and stopped, natural gas can be used for both baseload and peaking power, and to fill gaps in renewable power generation when wind or sunshine are not available.
Natural gas is also used for cooking, heating houses and buildings and heating water. In addition, natural gas fuels many industrial operations, including glass and steel foundries and aluminium and nickel smelters. It is also compressed for use as a transport fuel.
Natural gas is also a key ingredient in fertilisers and a wide range of industrial products, including plastics and polymers, textiles, paints and dyes.
Shale gas was formed over tens of millions of years from the compressed remains of organic material such as plants. Over time, increases in heat and pressure trapped this organic material in dense shale formations and it decomposed to form natural gas.
Shale formations are typically 2,500 to 4,000 metres below the earth’s surface and separated from other underground layers.
The parts of Australia most likely to hold commercial shale gas deposits are in:
Currently shale gas exploration and appraisal programs are underway in Western Australia, South Australia and the Northern Territory.
To produce shale gas, we drill wells deep underground into the shale. These wells are surrounded by steel and concrete to ensure they are separate from other underground layers, such as water aquifers.
Because the shales are hard and dense, we need to fracture them to create pathways for the gas to escape, using a process called hydraulic fracturing. This involves pumping a mixture of water, sand and small quantities of chemicals into the shale at pressure. The water and chemicals are then pumped out and the sand remains in the shale, holding open the fractures to allow more gas to be released.
The gas is then pumped through a network of pipes to stations where it is compressed, purified and sent on to customers.