Case Study: Factory Drilling Australia's Unconventional Coal Seam Gas

Abstract

The Queensland Curtis Liquefied Natural Gas (QCLNG) project is the world's first project to convert coal seam gas (CSG) into liquefied natural gas 1 . The project involves drilling thousands of wells in the Surat basin, installing an underground 540 km long pipeline to Gladstone and the building of a plant on Curtis Island to liquefy the natural gas. The project, which has been under construction since 2010, is on schedule to provide LNG for export from the end of 2014.The multi-billion-dollar investment by QGC, the Australian business of BG Group, is one of Australia's largest current capital infrastructure projects. Schlumberger has been contracted to deliver on the drilling and completion phase of this critical project.The "Factory Drilling*" project operates nine rigs using a multidisciplinary team consisting of project management staff utilising/coordinating logistics, warehousing, wellsite management, cementing, wireline, bits, solids control and directional services/personnel. The project has overcome significant challenges in the business development and start-up phases. Through the application of the "excellence in execution" philosophy, records have been broken and new performance benchmarks set in this unconventional CSG market.Since the start of the project in early 2012, using the team's project management abilities and incorporating LEAN (the identification and steady elimination of waste from operations) initiatives, the project has drilled and completed more than 1000 wells, some in as little as 2.15 days (drilling time) and 1.04 days (completion time).The optimisation initiatives have contributed towards reaching a state where the project is currently performing very close to the technical limit, yet challenges are still ahead to maintain and mature the safety culture and improve the operational efficiency even further.

Economic Synergies from Tighter Agri-Business and Coal Seam Gas Integration

“…Australia has an abundant supply of CSG resources estimated to be around 168,600 Petajoules (PJ) in 2012 [5], with potentially rich CSG areas, yet to be explored [6]. With growing demand for low-cost gas production, Queensland is playing a key role in Australia's CSG exports with the construction of three CSG to liquefied natural gas (LNG) facilities (each with two LNG trains), worth approximately ~ $USD60 billion [7][8][9] of infrastructure investment.…”

Coexistence Opportunities for Coal Seam Gas and Agribusiness

“…The upsurge in international demand for low‐cost gas has driven the development and expansion of the coal seam gas (CSG) industry in Queensland and has facilitated its international export through the three ∼$USD50 billion CSG to liquefied natural gas (LNG) projects constructed at Gladstone (Smith et al. ; O'Kane ). However, CSG development in Australia has been shadowed by public concerns associated with environmental issues (management of CSG associated water and salt) and land‐use conflict between new CSG developments and already existing farmland (Khan and Kordek ).…”