e˚˛˝˙ˆ the aust˜lian r˛ˇ˘˛ · investigation into the east coast gas market which...
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AUST�LIANTHEEnergy ReviewO I L – G A S – E L E C T R I C I T Y – R E N E W A B L E S
australianenergyreview.com.au
ISSUE 80, MAY 2017
APPEA 2017 P16NEWS: RENEWABLE ENERGY P8 A DAY IN THE LIFE P23
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NEW restrictions will force Australian liquefied natural gas (LNG) companies to limit overseas exports in an effort to secure domestic supply.
Announced by the Turnbull Government late April to take effect from July this year, the export controls would be a temporary measure to guarantee sufficient domestic gas supply for Australian consumers and put downward pressure on prices.
Prime Minister Malcolm Turnbull said
while progress had been made following his meeting with oil and gas leaders on 15 March and 19 April, requirements had not been met and tougher action had to be taken.
“It is unacceptable for Australia to become the world's largest exporter of liquefied natural gas, but not have enough domestic supply for Australian households and businesses,” Mr Turnbull said.
“That is why the Turnbull Government is introducing the Australian Domestic Gas Security Mechanism which will give the government the power to impose export controls on companies when there
is a shortfall of gas supply in the domestic market.
“Gas companies are aware they operate with a social licence from the Australian people.
“They cannot expect to maintain that licence if Australians are shortchanged because of excessive exports.”
Federal Resources minister Matt Canavan would be in charge of enforcing restrictions based on advice from the Australian Energy Market Operator and Australian Competition and Consumer Commission.
The gloves are off for Prime Minister Malcolm Turnbull who plans to cut domestic gas prices in half. Image: Sahlan Hayes.
Exporters under pressure on domestic supplyTurnbull talks tough
ELIZABETH FABRI
CAMERON DRUMMOND
Wind power to reach 817GW in 2021
TOTAL global wind power generation capacity is expected to reach 817 gigawatts (GW) in 2021, according to latest data from The Global Wind Energy Council (GWEC).
The GWEC Global Wind Report: Annual Market Update reported that growth would be led by Asia, installing 153.5GW between 2017 and 2021 bringing its total wind power generation capacity to 357GW.
Europe was set to install an extra 73.5GW for a total of 234.8GW and North America an additional 61.5GW to bring its total to 159GW.
GWEC’s five year forecast sees almost 60GW of new wind power installed this year, with the annual market expected to rise to about 75GW by 2021.
Wind power penetration continued to rise in 2016, with Denmark utilising the renewable energy source for 40 per cent of its electricity, followed by Uruguay, Portugal and Ireland all with more than 20 per cent penetration.
China topped new wind capacity, installing 23,370MW last year – almost 43 per cent of the global total of 47,915MW.
“Wind power is now successfully competing with heavily subsidised incumbents across the globe, building new industries, creating hundreds of thousands of jobs and leading the way towards a clean energy future,” GWEC secretary general Steve Sawyer said.
“We are well into a period of disruptive change, moving away from power systems centred on a few large, polluting plants towards markets increasingly dominated by a range of widely distributed renewable energy sources.
(CONTINUED ON PAGE 4)
“IT IS UNACCEPTABLE FOR AUSTRALIA TO BECOME THE WORLD'S LARGEST EXPORTER OF LIQUEFIED NATURAL GAS, BUT NOT HAVE ENOUGH DOMESTIC SUPPLY FOR AUSTRALIAN HOUSEHOLDS AND BUSINESSES.”
2 MAY 2017
THE AUST�LIAN ENERGY REVIEWCONTENTS
Renewable Energy 8
NEWS 1
MAY EDITIONOUT NOW
FRANK TUDORHORIZON POWER MANAGING DIRECTOR
A Day In The Life p23
INDUSTRY PROFILESCompanies Gearing Up 18
Heat Exchangers 19
Stainless Steel 21
Two Way Radio Systems 22
SPECIAL FEATURES
Santos 13
APPEA 2017 16
INPEX: Ichthys 10
news p 8
RENEWABLE ENERGY
feature p 12
SANTOS
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3MAY 2017
THE AUST�LIAN ENERGY REVIEW NEWS
ELIZABETH FABRI
ELIZABETH FABRI
DLNG eyes expansion
A FEASIBILITY study looking into a possible expansion of ConocoPhillips Darwin Liquefied Natural Gas (DLNG) is now underway. If successful a second train facility could be built, injecting thousands of jobs into the region.
Scheduled to be complete by the end of this year, the study would explore various LNG process technologies and production rates.
NT Chief Minister Michael Gunner said the oil and gas industry had significantly grown since the commissioning of Darwin
LNG in 2006, and a second train would be a multi-billion investment bringing welcome jobs into the Territory.
“The Territory Labor Government is focused on restoring trust by creating jobs – especially in the private sector – and we believe funding this feasibility study is a good investment,” Mr Gunner said.
“The first train at Darwin LNG created around 2500 jobs during construction and more than 8500 sub-contracts and purchase orders.
“In operation it directly supports more than 250 local jobs and on average around $100 million per year in supply and service opportunities.
ConocoPhillips Australia West External Affairs vice president Kayleen Ewin said the feasibility study was the first step in finding new ways to commercialise the substantial offshore resources in Northern Australia.
“With Darwin LNG, five upstream joint ventures and the Northern Territory Government involved, it is a pioneering example of all of industry and government collaborating on solutions to unlock major investments,” Ms Ewin said.
The Northern Territory Government had contributed $250,000 (about 40 per cent) to the study, with the remainder being financed by ConocoPhillips and upstream resource owners.
THE Turnbull Government has ordered the Australian Competition and Consumer Commission (ACCC) to begin a three year investigation into the East Coast wholesale gas market in an effort to create greater transparency and fairness for customers.
Announced on 19 April, following a meeting between Prime Minister Malcolm Turnbull, Australia’s liquefied natural gas executives and the Australian Energy Market Operator (AEMO), the inquiry will examine how gas suppliers will make more gas available to domestic gas users, and the effect this has on overall market dynamics.
Mr Turnbull said the new measure would “shine light” on transactions with the Australian gas market and help it operate more efficiently.
“This work will run over three years, with regular public reporting, and will give the ACCC and market participants a complete picture of the gas market,” Mr Turnbull said.
The Prime Minister however said while this progress was “encouraging” there was still a lot more that needed to be done.
“The Government remains concerned that the east coast export LNG operators have not yet clearly articulated how Australian households and business will get adequate supply at reasonable prices,” he said.
“The Government has asked the exporters to provide further information, in the context of possible regulatory options to address the short term market issues.”
Treasurer Scott Morrison said the consumer watchdog’s monitoring would hold gas suppliers accountable to make more gas available to the domestic market, and would propose a number of measures to address any issues found.
“As part of this work, the ACCC will scrutinise the pricing, volume and availability of domestic gas compared to gas that is being exported,” Mr Morrison said.
“The ACCC will also examine other parts of the gas supply chain, including storage, transportation and processing of gas, to ensure that actions taken by other industry participants do not undermine the ability of all Australians to access reliable, secure and affordable gas — whether it’s for the generation of electricity, or whether it’s for industry, families and households.”
ACCC chairman Rod Sims said the investigation was an important part of the Government’s plan to make more affordable gas available to industry and consumers.
“Importantly, the inquiry will help verify progress in changes in domestic gas supply and monitor commitments made by gas suppliers to the Government to make more gas available and also ensure gas is delivered at times of peak electricity demand,” Mr Sims said.
The inquiry followed a 2015 ACCC investigation into the east coast gas market which determined there was urgent need for new gas supply from various sources to support the domestic market.
ACCC will release public reports every six months, with its first report due in October, and final report due in 2020.
The existing ConocoPhillips Liquefied Natural Gas Plant in Darwin. Image: ConocoPhillips.
ACCC investigates East Coast market
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IN BRIEF
Drilling commences at 88E’s Icewine-2
PERTH-based 88 Energy has commenced its much anticipated Icewine-2 drilling program to confirm the commercial potential of the HRZ shale discovery in Alaska.
“The spud of Icewine-2 represents another milestone for the company and its shareholders and we now looking forward to a safe operation, above all else,” 88E managing director David Wall said.
The company anticipated that Icewine-2 would undergo production testing in late June or July this year.
Icewine-2 is the follow on from the previous success of the Icewine-1 discovery, which confirmed the potential of the large HRZ shale.
ALASKA
Increase in Permian Basin oil production
CRUDE oil production in the West Texas Permian Basin was expected to increase to an estimated 2.4 million barrels per day (b/d) in May, based on estimates from US Energy Information Agency’s Drilling Productivity Report.
Between January and March this year, oil production in the Permian Basin increased in all but three months, even as domestic crude oil prices fell.
The Permian continued to be attractive to drillers this year. As of 21 April, the number of rigs in the Permian Basin reached 340, or 40 per cent of the 857 total oil and natural gas rigs operating in the US.
TEXAS
ENERGY giant Chevron has been ordered to pay in excess of $300 million in back taxes after losing an appeal against an Australian Tax Office (ATO) ruling that it was avoiding tax on its Australian income.
The ATO accused Chevron of using an intra-company loan as a means of sending profits offshore and not paying relevant income tax to the Australian Government.
A Federal Court dismissed the appeal on 21 April and ordered Chevron to pay back the money.
Chevron said it was disappointed in the decision by the court regarding its financial dispute with the ATO.
“We will review the decision to determine next steps, which may include an appeal to the High Court of Australia,” the company said in a statement.
Chevron ordered to pay $300m tax billOIL
4 MAY 2017
THE AUST�LIAN ENERGY REVIEWNEWS
ELIZABETH FABRI
THE Queensland Government has called on the Federal Government to support a new gas development package that would see new infrastructure built across the State to secure domestic supply.
On Sunday 16 April, QLD Natural Resources minister Anthony Lynham put forward an offer to Federal Resources minister Matt Canavan, and requested a meeting to discuss a jointly funded study into State infrastructure options and funding to support the development of new pipelines.
“Urgent action is required to increase domestic gas supply to protect industry and to secure jobs,” Dr Lynham said.
“Queensland is already ahead of the pace with the measures we have underway, including land on offer where the gas will be for sale in Australia only.
“We are looking at further and larger land releases in the Surat Basin with the same Australian market conditions.”
Dr Lynham said there was a lot more that could be done, and access to new pipelines would open up potential gas producing areas like the Bowen and Galilee Basins, and put downward pressure on a looming east coast gas shortage.
Australian Petroleum Production and Exploration Association (APPEA) director
Rhys Turner said the QLD Government’s willingness to engage with the Commonwealth echoed what the industry had been saying for some time.
“Developing new fields to bring more gas to market is the most important part of the equation right now,” Mr Turner said.
“Exploration is at a 30-year low; regulatory costs and delays are discouraging
development as well as adding to the cost paid by our customers.
“We must also avoid an infrastructure deficit; Queensland has promising gas fields that can be developed in the Galilee and Bowen Basins.
“Unfortunately, there is a real risk that this gas may be stranded because of a lack of pipeline infrastructure.”
QLD pushes on with gas development
Chevron’s Gorgon LNG project.
Mr Turnbull said under Australia’s free trade agreements the Government had a right to protect the local industry from gas shortages, which risks losing 65,000 jobs.
“So this is a national-interest matter and it is a short-term solution to a longer-term problem, I just want to stress that,” Mr Turnbull said.
“The longer-term challenge that we face is that we are not producing enough gas on the east coast and that is because of bans on gas exploration and development in Victoria above all and to a lesser extent in New South Wales.”
He said the Government would not prescribe how the exporter must respond, allowing companies the flexibility to find viable commercial solutions; for example swapping cargoes out of portfolios or on the spot market.
“This action is expected to apply only to east coast exporters and will comply with our international obligations,” he said.
In an interview with ABC, Mr Canavan said the mechanism would be used to protect jobs and industries.
“But if shortfalls don't emerge — if more gas does come back on to domestic markets — we won't need to activate the mechanism and that would be ideal; that would be our preferred outcome,” Mr Canavan said.
Federal opposition leader Bill Shorten wasn’t convinced the mechanism would drive down prices to the level Mr Turnbull had suggested.
“Mr Turnbull’s promised Australia that gas prices will half; I want to hear that promise from the gas companies,” Mr Shorten said.
“If the gas companies won’t verify Mr Turnbull’s extravagant promises of halving gas prices, well then Turnbull has a real case to answer to the Australian people.”
However, Labor shadow energy minister Mark Butler was cautiously optimistic, telling the ABC “it looks like the Prime Minister has finally recognised what we've been saying for some time, that talking to the gas companies and waving his prime
ministerial finger is simply not going to get the job done”.
Australian Petroleum Production & Exploration Association (APPEA) chief executive Malcolm Roberts said restricting exports was “almost unprecedented for Australia”.
“At a time when we need billions in new investment to create more gas supply, any intervention that creates sovereign risk is alarming,” Mr Roberts said.
“There is no doubt the east coast gas market today is tight. For years, APPEA has been warning governments that the political and regulatory barriers to developing new gas supplies must be addressed urgently.
“Over the last five years, the industry has tripled east coast gas production, creating an entirely new supply from coal
seam gas. “The main obstacle to developing more
supply has been the opposition of some State Governments.
“The only solution is more gas, not more regulation.”
Australian Industry Group chief executive Innes Willox welcomed the news, labelling it an “appropriate” and a “welcome response to an extraordinary crisis”.
“Recently Ai Group put detailed proposals to both sides of politics for responsible exercise of the Commonwealth’s power over exports in order to motivate exporters to secure domestic supply, and we have made clear the costs that energy users are facing, and the consequences if nothing is done,” Mr Willox said.
“The Government has listened and followed through with decisive action.”
Royalty tax deters investment: report
A PROPOSED 10 per cent royalty imposed on Australia’s oil and gas industry would damage existing projects and drive away future investment in the sector, according to consultancy firm Wood Mackenzie.
The report, commissioned by industry body the Australian Petroleum Production and Exploration Association (APPEA) found that a 10 per cent royalty tax would harm the major developed liquefied natural gas (LNG) projects of Gorgon, Pluto, Wheatstone, Prelude and Ichthys.
Wood Mackenzie said that based on a long-term flat oil price assumption of $US60 per barrel, reduced internal rates of return (IRR) would challenge the ability for companies to justify taking projects forward.
“It would wrong to think that there will be no effect on existing developments,” the report stated.
“There will be additional investment required for these projects to maintain future production. However any incremental investment that will be required in the future will be put at risk by the introduction of a 10 per cent royalty.
“Not only would the economics of these incremental projects be adversely affected by changes to the fiscal terms, but Australia would be seen as being much more fiscally unstable, with a willingness to let companies invest and then to change the terms after companies have made these massive investments.”
APPEA chief executive Dr Malcolm Roberts said imposing a new tax amounts to a retrospective change to the arrangements that have been in place for 30 years.
“Such a glaring case of sovereign risk would deter footloose international investors,” Dr Roberts said.
“Australia is already a relatively high-cost place to produce oil and gas – adding political risk is likely to make us uncompetitive – Australia competes with 17 other LNG-producing countries.”
CAMERON DRUMMOND
“SUCH A GLARING CASE OF SOVEREIGN RISK WOULD
DETER FOOTLOOSE INTERNATIONAL
INVESTORS.”
Turnbull talks tough(CONTINUED FROM PAGE 1)
Image: Santos.
6 MAY 2017
THE AUST�LIAN ENERGY REVIEWNEWS
SAUDI energy minister Khalid al-Falih said an extension of the OPEC/non-OPEC production cut agreement was likely if global oil inventories did not fall to sufficient levels, Platts reported.
April marked the half way point for the six-month oil production cuts agreed by OPEC and eleven non-OPEC countries totalling an estimated 1.8 million barrels a day.
"There has been a strong level of commitment in the past three months," Falih said at the GCC Petroleum Media Forum in Abu Dhabi on 20 April.
“Unfortunately we still have not reached our goal.”
If stocks remained too high the agreement may be extended to nine or even 12 months from 1 January, he said.
OPEC ministers will meet on 25 May in Vienna to decide whether to extend the production cuts, with a monitoring committee composed of Kuwait, Algeria, Venezuela, Russia and Oman to provide a formal recommendation before that.
"We will have increasing demand for the rest of the year, and I expect we will have an extension of this agreement," Mr Falih said.
"We are still trying to know about the trends of other countries to know that we have a consensus on the extension."
Though many ministers have indicated their support for an extension of the production cuts, Mr Falih said that OPEC was "still communicating with many countries. And we will work to watch the market for April and May to ensure our colleagues in OPEC and outside OPEC will
take the right measures in this regard".The International Energy Agency stated
that it was a case of ‘so far, so good’ for producers.
“Prices have stabilised again recently after falling by about 10 percent in early March, with recent unplanned outages and
rising political tension in the Middle East playing a role,” the IEA stated in an 13 April release.
“For OPEC countries, compliance has been impressive from the start while non-OPEC participants are gradually increasing their compliance rate, although in their case it is harder for analysts to verify the data.”
The IEA believed that extending the output cuts beyond the six month mark would provide further support to prices.
However, while the supply side was expected to tighten throughout the year, IEA predicted that overall non-OPEC production, not just in the US, will soon be on the rise again.
“Even after taking into account production cut pledges from the eleven non-OPEC countries, unplanned outages in Canada as well as in the North Sea, we expect production will grow again on a year-on-year basis by May,” the Agency stated.
“For the full year, we see growth of 485 kb/d, compared to a decline of 790 kb/d in 2016.
“The main impetus comes from the US where monthly data shows that output reached 9.0 mb/d in March, up from a trough of 8.6 mb/d in September 2016.
“We now expect that US production will be 680 kb/d higher at the end of the year than it was at the end of 2016, an upgrade to our previous forecast.”
A TEAM from Curtin University’s WA School of Mines (WASM) has won bronze in the American Association of Petroleum Geologists (AAPG) Imperial Barrel Award competition in Houston, Texas.
The annual Imperial Barrel Award (IBA) is for geoscience graduate students from universities around the world, and simulates the exploration work undertaken by geologists and geophysicists in the oil industry.
Twelve teams – from Canada, the US, Nigeria, Hungary, Columbia, Oman and
Australia – made the final out of 60 that took part in the competition worldwide.
The WASM team of Kirk Gilleran, Mike Maher, Jerome Paz, Jiaojing Bi and Elena Alganaeva were awarded the Stonely Medal and $US5000 for finishing third.
Chevron Professor of Petroleum Geology within the Department of Applied Geology Chris Elders travelled with the team.
“The team placed third after giving an outstanding presentation on their evaluation of the hydrocarbon prospectivity of the Taranaki Basin to a team of judges from Chevron, Shell, Saudi Aramco, Anadarko, ExxonMobil and Schlumberger,” Professor Elders said.
Second place went to Eotvos Lorand University in Hungary, with first place awarded to the home team from the University of Houston.
The team won the right to compete in Houston after winning the Asia Pacific Region heat of the competition – the second time Curtin had won the Asia-Pacific competition in four years of competing.
“To see the team go on to do so well in the international finals is a great credit to the team, the Department of Applied Geology and Curtin’s reputation for Petroleum Geoscience,” Professor Elders said.
OPEC backs extended production cutsREUBEN ADAMS
REUBEN ADAMS
CAMERON DRUMMOND
WASM team takes bronze
WOODSIDE Petroleum has commenced expansion studies at its Pluto LNG project, engaging contractors to develop concept options by mid-year.
The company was looking at a small to medium scale extension of its 4.9 million tonnes per annum facility, lifting capacity by about 20 per cent.
It also flagged projects at its Browse and Scarborough fields, and would assess development concepts in the second half of 2017.
Woodside also reported an 11 per cent drop in March quarter revenue due to adverse weather conditions.
March quarter revenue was $895.4 million, down from the $1.03 billion in the same period last year due Cyclone Blanche and heavy rainfall adding to 21 days of topical system weather impacts – well above the 13 day average.
Woodside chief executive Peter Coleman said the first quarter demonstrated progress against the company’s 2017 priorities.
“We continue to work with the Wheatstone operator on final onshore and offshore commissioning activities ahead of expected first LNG mid-year,” he said.
“Operational performance remains strong with the North West Shelf gas facilities and the Nganhurra FSPO achieving 98 per cent reliability during the quarter.
“Pluto production was approximately 5 per cent lower than expected; a positive outcome given the significant weather impacts experienced during the quarter.”
Exploration spending during the quarter was $36.3m, down from $128.6m in March last year.
Woodside eyes Pluto expansion
OPEC ministers will meet on 25 May in Vienna to decide whether to extend the production cuts.
The WASM team of Kirk Gilleran, Mike Maher, Jerome Paz, Jiaojing Bi and Elena Alganaeva were awarded the Stonely Medal and $US5000 for finishing third.
8 MAY 2017
THE AUST�LIAN ENERGY REVIEWNEWS: RENEWABLE ENERGY
IN BRIEF
Carnegie complete $18m capital raise
CARNEGIE Clean Energy has secured $18 million in funding to go towards a number of projects in its portfolio, including its 10MW Northam Solar Project.
The large-scale solar power station, once operational later this year, would comprise 34,000 solar panels and deliver 24,000 MWh of electricity per annum for at least 25 years.
Carnegie chief executive Michael Ottaviano said the capital raising was three times the amount of the original target and “a clear indication of the support for the expansion of its business into solar, battery storage and microgrids”.
"The capital raised will allow us to accelerate our plans to grow the business rapidly across Australia and the region," Dr Ottaviano said.
WA
SolarQ seeks council approval for 800MW solar farm
NEWLY-formed SolarQ has sought approval from Queensland’s Gympie regional council to construct what it says would be Australia’s largest solar farm.
Stage 1 of the proposed Lower Wonga solar farm would produce 350 megawatts (MW) up to a total 800MW over several stages, with up to 4000MWh of battery storage.
SolarQ said that it would create about 450 jobs during an 18 month construction period and once complete, the project would produce enough electricity to power 127,000 homes.
QLD
THE Palaszczuk Government is taking expressions of interest from the renewable energy industry to develop a 1248 hectare parcel of land in Gladstone into a solar, wind or biofuel mega project.
“This land at Aldoga is equivalent to 160 Suncorp Stadiums and could potentially generate power for up to 130,000 homes,” Deputy Premier and Infrastructure and Planning minister Jackie Trad said.
“Solar, wind or biofuel renewable energies are all possible for this project and we are asking the industry to tell us their ideas for this site.”
The site has potential to support up to 450MW of renewable energy and is located next to Powerlink’s Larcom Creek substation.
QLD land reserved for renewablesQLD
ELIZABETH FABRI
ELIZABETH FABRI
Hydro Tas expansion in worksAUSTRALIA’S largest renewable energy producer Hydro Tasmania could generate enough electricity to power an additional 500,000 homes, under a new expansion project currently at the feasibility stage.
On 20 April, the Federal Government in conjunction with the Tasmanian Government, announced a feasibility study had begun to evaluate a number of pumped hydro energy storage schemes that could deliver up to 2500 megawatts (MW) of storage capacity for the National Electricity Market (NEM) and subsequent expansions at existing facilities.
The study, partially funded by the Australian Renewable Energy Agency (ARENA), was divided into two streams; the first assessing an expansion of the Gordon Power Station, as well as an expansion and possible replacement of the Tarraleah Power Station to increase output by about 40 per cent.
The second study would inspect 13 separate pumped hydro opportunities to test for feasibility.
The study is comprised of four large projects: Mersey Forth-1, Mersey Forth-2, Great Lake and Lake Burbury; each with capacity of around 500-700 MW, together with an alternative of nine small scale sites that total 500MW.
Speaking at a joint press conference
Prime Minister Malcolm Turnbull said the expansion of Hydro Tasmania was a “huge opportunity”, with potential to help Tasmania become “a battery for Australia”.
“We are seeing here in Tasmania the opportunity for this state to provide even more renewable energy, wind and hydro, than it does today,” Mr Turnbull said.
“And we recognize that as the energy system changes, as you get more wind and solar in particular into the mix, you need to have the ability to back that up, to store it or to provide the backup power with gas.
“Tasmania has both the opportunity to double the capacity of Hydro Tasmania with new investment and with pump storage.
The news came a month after the Federal Government announced its plans for $2 billion expansion of Snowy Hydro in NSW.
“We've talked about Snowy Hydro 2.0. This could be Tassie Hydro 2.0,” Mr Turnbull said.
Hydro Tasmania has a long history in the region, recently celebrating 100 years of operation in 2014.
Hydro Tasmania chief executive Steve Davy said if Hydro Tasmania embarked on all the projects, cost estimates would total more than $3 billion.
“We are seeing this as a way of over the next 12 months or so setting up a blueprint about how Tasmania's renewable resources developed over the coming decades,” Mr Davy said.
“Not every power station can built at once.
“The current hydro system was built over many decades.”
LAING O’Rourke subsidiary SunSHIFT has developed a mobile solar farm system for large-scale on-grid and off-grid electricity generation that can be installed and packed down easily within days.
The pre-engineered and pre-fabricated container-sized modules are being trialled at a site in Rutherford, NSW, before the technology enters the global market.
The $2.1 million trial funded by the Australian Renewable Energy Agency (ARENA), would see SunSHIFT complete a pre-commercial deployment of one of its
modular and movable 1 megawatt Block solar photovoltaic (PV) products.
SunSHIFT general manager Will Rayward-Smith said after three years partnering with ARENA, ABB and SunPower, the company was looking forward to showcasing its solar PV technology to the industry.
“Off the back of this demonstration, we will be ramping up manufacturing to meet the strong demand for our product from mining companies, independent power providers, and infrastructure investors active in emerging markets and developing economies,” Mr Rayward-Smith said.
ARENA chief executive Ivor Frischknecht
said the system could help smooth the transition to a renewable energy future as a cleaner and more cost-effective alternative to diesel generators for off-grid users.
“This latest project will provide proof that SunSHIFT can be deployed at scale then effectively packed up and redeployed,” Mr Frischknecht said.
“Quick set up and pack down, along with sizing flexibility, presents several advantages for different applications.
“Projects that only last a handful of years, like construction and mining operations, could benefit from SunSHIFT without having to rely on the typical 20-plus year payback period for solar installations.”
Tarraleah power station. Image: Hydro Tasmania.
Mobile solar farm trial
If the product is successful, ARENA has prearranged a royalty from the profits.
“QUICK SET UP AND PACK
DOWN, ALONG WITH SIZING FLEXIBILITY,
PRESENTS SEVERAL
ADVANTAGES FOR DIFFERENT
APPLICATIONS. "
ELIZABETH FABRI
Turning mineshafts into energy projects
HISTORIC mineshafts in regional Victoria could soon be transformed into renewable energy projects with the State Government committing $100,000 towards a new feasibility study into using empty shafts to generate and store energy.
The study would assess the feasibility of repurposing empty mineshafts using solar powered pumped hydro.
“Solar pumped hydro has the potential to store and generate significant amounts of energy,” Victorian Energy, Environment and Climate Change minister Lily D’Ambrosio said.
“This feasibility study is the first key step towards realising the benefits of solar
pumped hydro for the Bendigo region.”The State Government also invested
$900,000 into developing three two-year pilot community power hubs in Latrobe Valley, Bendigo and Ballarat.
The hubs would be owned and operated by the community and help drive investment into the region and support new projects through offering technical and legal counsel, and start-up funding.
“Interest in community energy projects has increased significantly over the years, with communities wanting greater control over their energy and associated costs,” Ms D’Ambrosio said.
Expressions of interest to host a pilot Community Power Hub close on 19 May with the successful applicants notified in June.
The community power hubs will help create jobs and reduce electricity bills.
Image: Victorian State Government.
Milestones for Lincoln GapELIZABETH FABRI
LINCOLN Gap Wind Farm is a step closer to construction after securing two long-term power purchase agreements with ERM Power in April.
Developed by Singapore-based Nexif Energy, the 212 megawatt (MW) project will be built in Port Augusta, South Australia, and feed into the State electricity grid via the Electranet transmission network.
The project was estimated to cost $450 million, and would be made up of up to 59 wind turbines producing enough energy to power more than 110,000 homes.
Nexif Energy Australia chief executive Zeki Akbas said the deal was a major milestone for the project and propelled it closer to financial closure.
“These long-term agreements will see ERM Power buy LGCs generated by the Lincoln Gap Wind Farm in the coming years helping deliver renewable energy into the grid,” Mr Akbas said.
“It is a vote of confidence in the project, the town of Port Augusta and South Australia at a time when the need for innovative and reliable energy solutions in the State has never been higher.
“The project will also create a substantial number of jobs and stimulate economic activity in the region.”
ERM Power managing director and chief executive Jon Stretch said the
announcement reinforced the company’s commitment to the growth of Australia’s renewables.
“Reducing emissions from the electricity sector is an important part of a long-term plan to reduce greenhouse gas emissions,” Mr Stretch said.
“The need for an orderly transition to low emissions electricity generation is obvious.
“There is a huge opportunity and responsibility to get the transition from fossil fuels to renewables right, given the significant impact on the energy market, economy, jobs and our environment.”
Senvion Wind Energy Solutions has won the building contract for project, with construction set to begin later this year for completion by mid-2018.
Image: Stock.
10 SPECIAL FEATURESINPEX: ICHTHYS
MAY 2017THE AUST�LIAN ENERGY REVIEW
Now more than 90 per cent complete, the $US37 billion Ichthys project is on the home stretch to first production.
Countdown to productionTHE INPEX majority owned project is the largest liquid hydrocarbon discovery in Australia since the 1960s, containing more than 12 trillion cubic feet of gas and 500 million barrels of condensate, with an operating life that extends more than 40 years.
Construction of the Ichthys central processing facility (CPF) — the world’s largest semi-submersible platform — is complete, as is the 336 metre-long Ichthys floating production, storage and offloading facility (FPSO).
Installation of its 890km pipeline, the longest subsea gas export pipeline in the southern hemisphere, which will connect the field to the state-of-the-art onshore facilities once in operation was also ticked off.
The onshore infrastructure construction in Darwin has moved forward rapidly with more than 8000 workers currently on site every day.
Work on the power plant and storage
tanks came to a temporary halt earlier this year when hundreds of workers were stood down due to financial disputes between project sub-contractors.
First production from the project was originally scheduled at the end of 2016, however was pushed back to the September 2017 quarter following
a review of the project’s development schedule.
In the construction phase alone, the project has already created jobs for more than 11,000 Darwin locals, and let more than 4000 contracts and purchase orders for 1100 NT businesses; injecting more than $9.6 billion into the region.
Contract issues
In January this year, CIMIC subsidiary UGL pulled the plug on its $550 million Ichthys power plant contract, eight months ahead of scheduled first production.
The contract between UGL and its joint venture partner CH2M, and Ichthys Project EPC contractor JKC Australia LNG was for the design, construction and commissioning of the Combined Cycle Power Plant (CCPP).
The termination resulted in about 300 job losses, and was believed to be an outcome of delays to the original schedule which led to cost blowouts.
ELIZABETH FABRI
INPEX-led Ichthys LNG Project central processing facility, Ichthys Explorer in South Korea, March 2017.
All images: INPEX.
“OUR PROJECT’S TWO GIGANTIC FLOATING FACILITIES WILL BE LOCATED IN THE ICHTHYS GAS- CONDENSATE FIELD, ABOUT 220 KILOMETRES OFFSHORE WA, FOR 40 YEARS OF CONTINUOUS OPERATION, SETTING NEW BENCHMARKS FOR DURABILITY.”
Progress at Bladin Point near Darwin in April 2017.
11MAY 2017
THE AUST�LIAN ENERGY REVIEW INPEX: ICHTHYS
In a brief statement at the time CIMIC said its “current position in respect of the termination is adequately covered by provisions and it does not have any material impact to its financial performance in 2016 and 2017”, and when approached declined to provide further comment.
JKC Australia LNG project director John Bramley said JKC was “disappointed” the UGL-CH2M JV Consortium had taken this action.
“As a result, construction work on the combined cycle power plant has temporarily ceased, however other activity continues,” Mr Bramley said at the time.
“The engineering, procurement and construction of the combined cycle power plant is approximately 89 per cent complete, and JKC remains committed to delivering this scope of work and the overall Ichthys Project Onshore LNG Facilities.”
A spokesperson for INPEX said the dispute was a matter between JKC and its subcontractors, and the schedule would not be affected.
“JKC is responsible for delivering the engineering, procurement, construction and commissioning of the Ichthys LNG Project onshore LNG facilities and related infrastructure,” the spokesperson said.
“Outstanding works to complete the remaining CCPP scopes are not on the critical path for the start of production.
“Our target remains to start production in the third quarter of 2017.”
However, in March a second contract row made headlines; this time between Ichthys Project subcontractors Laing O'Rourke and Kawasaki Heavy Industries (KHI).
The contract between both parties was for Laing O'Rourke to construct the four cryogenic tanks at the Ichthys project onshore site on behalf of KHI, under EPC contractor JKC.
The conflict was again for financial
reasons, and resulted in 800 job losses; 300 locals and 500 fly-in, fly-out workers.
Laing O’Rourke had been working on site since mid-2013 and claimed KHI had not paid them for several months.
“Laing O’Rourke has made significant efforts to resolve the matter, but direct approaches to KHI in Japan over recent weeks have failed to produce a satisfactory outcome,” Laing O’Rourke said in a statement.
“Laing O’Rourke’s priority is to now attempt to redeploy staff to the company’s significant national pipeline of projects while also assisting sub-contractors impacted by this demobilisation.”
In response to the fallout, Ichthys project managing director Louis Bon told NT News the company was “committed to supporting the health and wellbeing of the workers stood down.”
“While not the employer of the
approximately 800 impacted workers, INPEX takes its role as a major company operating in the Northern Territory seriously,” Mr Bon said.
“These are individuals with important trade skills such as riggers, mechanics and scaffolders.”
Mr Bon said work on the cryogenic tanks was 91 per cent complete and the company was still expected to meet its production target in September.
The 890 kilometre gas export pipeline being laid in August 2015.
An evolving business leader
DICE is a proudly 100 per cent Indigenous owned electrical contracting company in operation for more than a decade.
DICE is now a leading service provider to the construction industry in Darwin, throughout the Northern Territory and now right across Australia.
The company is still an industry leader in the field of electrical contracting, but the name and brand DICE now stands for so much more.
DICE has become a multi-faceted, ever evolving platform delivering work in all aspects of the construction industry.
DICE prides itself on delivering top quality service in all aspects of the electrical trade, including domestic, industrial and commercial installation, maintenance and repairs; hazardous areas installation, maintenance and repairs;
planned preventative maintenance programming; and electrical system design and installation consultation.
DICE also provides a broad range of other services including through its subsidiary businesses. DICE Contracting provides maintenance and building maintenance services, including emergency 24/7 response and resolution.
DICE Renascent is a construction, refurbishment and fitout specialist, while Allgrid Energy provides renewable energy solutions.
DICE’s diverse range of services and collaborative business model allows it to supply high quality products and effective service delivery on projects of all sizes and in all regions, from construction maintenance on defence bases, high end fitouts and refurbishments, through to
delivering affordable energy solutions to the most remote communities in Australia.
“We have had great success introducing affordable renewable energy solutions in remote communities. We’ve been able to achieve over 50 per cent savings for the people and as a result of delivering affordable quality power have contributed to major, positive social impacts,” DICE founder Raymond Pratt said.
An example of this was witnessed after the completion of a solar and storage project in two communities near Tennant Creek in the Northern Territory.
The two communities, now fully occupied, have grown from two permanent adults to over 35 adults and children. The people are now living more independently and have created
two permanent teaching jobs for the 15 students now attending school on country.
DICE continues to embody the vision that the company has a role to play in promoting and encouraging Indigenous business engagement.
It is DICE’s vision to go beyond Indigenous employment, and rather encourage and facilitate Indigenous business ownership.
Where possible DICE chooses to engage, mentor and support local, regional and national Indigenous businesses to help facilitate social wellbeing within remote communities, continual growth in business ownership within the wider community, advancement of Indigenous entrepreneurship, and growth in Indigenous employment.
“SINCE OCTOBER 2014, HUNDREDS OF PEOPLE HAVE WORKED OFFSHORE WITHOUT ANY SIGNIFICANT SAFETY INCIDENTS TO INSTALL THE ICHTHYS LNG PROJECT’S 133,000 TONNE SUBSEA NETWORK.”
12 MAY 2017
THE AUST�LIAN ENERGY REVIEWINPEXProject updates
In April, the Ichthys project’s second largest shareholder Total (30 per cent) came forward stating the project would begin shipping condensate by the end of 2017, and LNG in early 2018.
Total chairman and chief executive Patrick Pouyanne told Reuters the subcontractor disputes were not holding up the start up of production.
"We always said by year-end; you have two things- you have the gas production upstream and then it takes time,” Mr Pouyanne said.
“We have to fill the pipeline and then start the train.”
Mr Pouyanne also confirmed the CPF would begin its 5600km journey from South Korea to the Browse Basin “soon”.
Earlier this year in February, INPEX held a double celebration at the Samsung Heavy Industries (SHI) and Daewoo Shipbuilding & Marine Engineering (DSME) shipyards in South Korea for the official naming of the CPF and FPSO.
Australian Foreign Affairs minister Julie Bishop named the CPF the Ichthys Explorer, while former Northern Territory chief minister Clare Martin named the FPSO the Ichthys Venturer.
INPEX said the commissioning work to test the functionality of the individual equipment was almost complete and Ready for Sail Away (RFSA) would be achieved following the completion of commissioning and assorted authentication work.
The CPF will be permanently moored near the field by 28 mooring lines, and the FPSO will be stationed about 3.5km away.
Each facility has the capacity to accommodate up to 200 workers.
At the subsea level, in January INPEX announced the successful and
safe installation of the network of subsea infrastructure and equipment, which spread across a 400sqkm area in the Ichthys field.
Ichthys Project managing director Louis Bon described the milestone as an “outstanding achievement”.
“Since October 2014, hundreds of people have worked offshore without any significant safety incidents to install the Ichthys LNG Project’s 133,000 tonne subsea network,” Mr Bon said.
“Carrying out this work more than 200km out to sea in water depths of around 250m involves substantial planning and logistical challenges to manage crew changes and equipment transportation.
“Safely completing these complex tasks is a tribute to the world-class processes we have in place and the commitment of our personnel to ensure the protection of our people and the environment.”
The subsea network included a 110 metre Riser Support Structure (RSS) support structure, 139km of flowlines, 49km of umbilicals and flying leads, five manifolds, 2640 tonnes of production and MEG spools, and a subsea distribution hub.
Weighing more than 7000 tonnes, the RSS sits on the sea bed and supports the risers connected to the CPF, giving them an S-shape.
INPEX said once all future developments
have been completed, the structure could carry up to 25 risers.
Onshore, all the 230 prefabricated modules had arrived, and the handover of the operations complex had begun; including the control centre, laboratory, warehouse spaces, administration buildings, fire station, and workshops.
Following this, INPEX will fire-up the first of the five gas turbine generators at its 490MW CCPP.
Entering production
Once INPEX achieves its much anticipated first production milestone, the pipeline will deliver natural gas and some condensate from the CPF to the onshore processing facilities at Bladin Point, near Darwin, which will be processed for overseas export, primarily to Japan.
The CPF is the heart of the Ichthys LNG Project and will be the first semi-submersible production platform to be installed and operated in Australian waters. The largest platform of its kind in the world, the CPF is made up of a hull (110m x 110m) carrying topsides (155m x 125m) as well as living quarters for up to 200 people.
The company’s goal is to produce 8.9 million tonnes of LNG and 1.6mt of LPG per annum, as well as 100,000 barrels of condensate at peak.
The company also plans to have 50 development wells, divided between 12 and 15 drill centres, over the 40 year life of the project for sustained production.
INPEX currently had an interest in 12 exploration blocks in the Basin, and operated six, hinting at further growth for the project moving forward, with space to build up to four additional trains and a pipeline with tie-in points to connect to future fields.
INPEX-led Ichthys LNG Project floating production, storage and offloading facility at South Korea in November 2016.
13MAY 2017
THE AUST�LIAN ENERGY REVIEW SANTOS
Solid March quarter results have been tempered by rising tensions over the Turnbull Government’s domestic gas plan.
Energy securityON 15 March the Turnbull Government held crisis talks with gas industry heavyweights, including Santos, Origin, ExxonMobil and Shell, to address the supply shortages and ballooning prices in eastern markets.
Afterwards, Mr Turnbull called the meeting a success.
“[The] fundamental outcome of the meeting is this: that the producers have given us a guarantee to ensure that gas is available for the national electricity market,” Mr Turnbull said.
“They [the producers] have given us a commitment – a guarantee – that gas will be available to meet peak demand periods in the national electricity market.
“The implementation arrangements are going to be developed with the market bodies and the other industry participants and we’ll be meeting again in a month.”
Two of the east coast LNG exporters, AGLNG and QGCLNG, gave a commitment to become net domestic gas contributors.
The third, Santo-led GLNG, took the matter on notice.
In a subsequent press conference Mr Turnbull was asked if the Government was concerned by the lack of commitment from GLNG.
“We have the ability to control exports,” he said.
“So what we're seeking from the industry - and they understand the context in which their commitments are being sought - what we're seeking from them are commitments that ensure that the domestic gas market is well-supplied.”
“That's fundamental. They understand that. They understand it very well. All of the participants around the table understand it also.”
Santos subsequently made proposals to its partners in the $US18.5 billion GLNG gas export project – including French giant Total SA, Malaysian company Petronas, and Korea Gas Corporation – to increase supplies on the east coast, according to a 24 March article in the Financial Review.
But chief executive Kevin Gallagher said that within GLNG Santos was “just one vote of four, so we've got to work with our partners before we can say what we're going to do”.
"Remember, these guys, along with Santos, have invested billions of dollars building this project,” Mr Gallagher told AFR Weekend.
“We can all have a view on whether that was well spent money or not but the fact is they have invested billions of dollars and they have a right for investment to be protected."
Mr Gallagher joined a chorus of voices, including the Federal Government, blaming State Government policies for restricting access to onshore gas.
Mr Gallagher told Sky News Business in April there would be no shortage had past projects been put on the pipeline.
“There's plenty of gas on the east coast and in the Northern Territory, it's a case of being able to develop it,” he said.
Narrabri
Santo’s $2b Narrabri CSG project, near its namesake town in north-western NSW, could be a crucial to energy security in the medium term.
Santos is proposing up to 850 wells to supply up to 50 per cent of the State’s gas needs for two decades.
Santos submitted the State Significant Development Application and associated Environmental Impact Statement (EIS) for Narrabri to the NSW Department of Planning and Environment on 1 February this year.
Santos would make the gas available to NSW and the east coast domestic market via a pipeline linking into the existing Moomba to Sydney Pipeline.
The $450 million pipeline would be constructed by APA Group and was subject to a separate approval.
Mr Gallagher said Santos had spent time producing a comprehensive EIS so the local Narrabri community and stakeholders could be confident the environment and water would be protected as the project was developed.
“The EIS has concluded the project can proceed safely with minimal and manageable risk to the environment,” Mr Gallagher said.
“The Narrabri Gas Project has the potential to play a significant role in the domestic energy space.
“Natural gas has a vital role to play in delivering energy security, while having the additional benefit of being 50 per cent cleaner than coal resulting in a significant reduction in carbon emissions.
“The development of new natural gas resources is crucial in assisting Australia’s move towards a clean energy future.
“In NSW alone, more than one million homes and 33,000 businesses rely on natural gas as a source of energy.”
The EIS included extensive studies and modelling on the environment in the project area, including on water, flora, fauna, soil, noise, air quality and cultural heritage.
Santos drew upon more than 13,000 hours of on ground environmental surveys, carried out by environmental scientists, and considered potential social impacts through thorough community and stakeholder consultation.
The operations would be on about 1000 hectares in and around the Pilliga near Narrabri. The majority of the project would be on State land in parts of the Pilliga that were set aside by the NSW Government for uses including forestry and extractive industries.
REUBEN ADAMS
“THE PROJECT COULD CREATE ABOUT 1300 JOBS DURING THE INITIAL CONSTRUCTION PHASE AND AROUND 200 ONGOING JOBS, MANY OF WHICH WOULD BE LOCALLY BASED.”
(CONTINUED ON PAGE 17)
15MAY 2017
THE AUST�LIAN ENERGY REVIEW SANTOS
Heat Tech leads remote innovationHEAT Tech has unveiled its latest and most innovative concept, the Heat Tech RMS (Remote Monitoring Device).Designed and manufactured in Australia by the company’s own electronic team, the Heat Tech RMS is the only one of its kind on the Australian market which has passed rigorous field testing in all conditions, while providing 100 per cent connectivity and control.The Heat Tech RMS not only has the capacity to visually and electronically monitor work from a designated off-site location, it also has the ability and control measure to safely shut down operations in the field while remaining off-site. Work productivity, quality control and scope for working in inclement weather conditions are just a few benefits of this innovation. The Heat Tech RMS also offers significant cost savings to clientele through reduction of labour and lost productivity time.Interested parties can discover how the Heat Tech RMS will save them money today by visiting: www.heattech.com.au.
The NSW Government has recognised the project’s importance, declaring it a Strategic Energy Project, estimating the top 500 industrial gas users provided more than 300,000 jobs which rely on an affordable, secure supply of natural gas.
The project could create about 1300 jobs during the initial construction phase and around 200 ongoing jobs, many of which would be locally based.
Over its life, the project could generate around $1.2b in State royalties.
The local community would also benefit from a Gas Community Benefit Fund of up to $120m to support local programs and initiatives.
March Quarter Results
In December 2016 Santos announced its new three phase growth strategy to drive shareholder value – Transform, Build, and Grow – which appeared to be paying dividends after the company posted strong March Quarter results.
Mr Gallagher said the first quarter results was further evidence the Santos turnaround strategy was delivering positive results.
“GLNG produced higher LNG volumes in the first quarter, as strong upstream field performance delivered higher volumes of equity gas to the LNG plant,” he said.
GLNG LNG production increased to 1.4 million tonnes for the quarter as continued strong production from Fairview and improved Roma field performance boosted equity gas supply.
Total first quarter production of 14.8mmboe was down slightly on the previous quarter, primarily due to the sale of the Victorian, Mereenie and Stag assets, partially offset by higher GLNG equity production.
Total sales volumes of 18.6mmboe were
lower due to asset sales, lower third-party volumes and the timing of liftings.
“Our costs have again been reduced, we have improved our free cash flow position and our net debt has been lowered,” Mr Gallagher said.
“Our 2017 forecast free cash flow breakeven now stands at US$34 per barrel.
“This is a significant reduction from the $47 per barrel mark at the beginning of 2016.
“Strong free cash flow combined with cash proceeds from asset sales and the Share Purchase Plan enabled us to reduce net debt by US$380 million in the first quarter.
“This is strong progress towards our target of a US$1.5 billion reduction in net debt by the end of 2019.
“We will continue to prioritise free cash flow for debt reduction.”
(CONTINUED FROM PAGE 15)
16 MAY 2017
THE AUST�LIAN ENERGY REVIEWAPPEA 2017
Running for more than 56 years, the APPEA Oil and Gas Conference & Exhibition is the largest annual upstream oil and gas event in the southern hemisphere, attracting industry leaders from around the world. APPEA 2017 will be held from 14–17 May at the Perth Convention and Exhibition
Centre, WA.
Pointing the way forward
THE APPEA Oil and Gas Conference & Exhibition has grown into more than a showcase for the national and international oil and gas industry; it also allows delegates to network and to meet and learn from the industry’s best minds.
APPEA 2017 will be held as debates on Australia’s energy challenges reach a fever pitch.
International experts and Australian industry leaders will provide up-to-date analysis, case studies and technical know-how on the big issues.
The conference will also examine oil and gas projects, technologies, trends and opportunities in other parts of Australia; and politicians, executives and analysts will discuss the policy concerns confronting Australia.
APPEA chairman Bruce Lake said that this years’ event would offer more than 100 speeches and presentations.
“These will examine issues ranging from global and national developments in energy and climate policies;
unconventional gas; LNG; project development; updates from regulators; tax, fiscal and commercial issues; prospectivity of frontier basins; and other scientific and technological reports,” Mr
Lake said.“We are seeing innovation in the
offshore, onshore and LNG sectors in several parts of the eastern states, South Australia and Northern Territory.
“Issues such as technology and performance, and engagement and building trust, are relevant everywhere the industry operates.”
APPEA chief executive Malcolm Roberts said the upcoming conference and exhibition was an indispensable sounding board for the upstream petroleum industry in Australia.
“The conference program provokes discussion on the major issues of the day,” Dr Roberts said.
“But it’s in the convention centre corridors and the exhibition hall aisles where some of the best exchanges happen; there are so many opportunities for making new connections and sharing insights.”
The review of the petroleum resource rent tax will be a key issue for many conference attendees.
“Changes to our tax regime put at risk Australia’s capacity to find and develop oil and gas resources. The conference program addresses this issue — and we will be listening closely to the discussions around the event,” Dr Roberts said.
CAMERON DRUMMOND
“ISSUES SUCH AS TECHNOLOGY AND
PERFORMANCE, AND ENGAGEMENT AND
BUILDING TRUST, ARE RELEVANT EVERYWHERE
THE INDUSTRY OPERATES.”
17MAY 2017
THE AUST�LIAN ENERGY REVIEW APPEA 2017
Dr Roberts said policymakers were now confronting tough decisions that can no longer be deferred.
“The conference theme – Energy in Transition – is right on the money, literally and metaphorically,” he said.
“Decisions made in the next 12 months will affect the industry’s future – its ability to earn the revenue necessary to sustain jobs and investment.”
This year, the exhibition hall will host more than 200 exhibiting companies showcasing their products and services.
These will include representatives from Australian and international oil and gas producers, manufacturers, service providers, energy consultants, government representatives and associated industry members.
An array of products will be on display; including oilfield equipment and software, field automation, data solutions, research and education.
The exhibitions run across all three days of the conference.
Sessions - what to expect
Day One
The opening session of APPEA 2017, Energy in Transition will feature high-level addresses from the Federal Government, including Minister for Resources and Northern Australia Matt Canavan and a post-election address from a WA state political leader; as well as APPEA chairman Bruce Lake.
Combined with a lead industry address featuring Woodside chief executive Peter Coleman, the session will set the scene for three days of in depth discussion and debate as the industry considers its place in a period of rapid, and turbulent, change.
In the afternoon of the first day, eight concurrent sessions will give delegates a
plethora of attendance options to choose from, covering topics such as operating in the Great Australian Bight, collaboration, and environmental management.
A highlight of these sessions will be session two – ‘Operating in the Great Australian Bight’ – and will showcase gas exploration options and environmental considerations in Australia’s largely untapped southern ocean region, with presentations by speakers from the CSIRO, Chevron, SARDI and BP.
Day Two
Tuesday’s opening plenary will discuss how industry diversity and inclusion can improve an organisation’s profitability, reputation and effectiveness.
Session speakers and APPEA guest facilitator Shell Australia general manager Michael Schoch will explore the role diversity plays in growing a strong business and the opportunities and challenges such an approach
may face when an industry is in a period of slower growth.
Industry speakers include Clough chief executive Peter Bennett, BHP Billiton Petroleum Australia general manager Graham Salmond, as well as 2016 QLD Young Australian of the Year and Mechanical Engineer Yassmin Abdel-Magied.
Twelve more concurrent sessions after lunch that day will include topics such as acreage releases, seismic technology, process safety, coal seam gas and research innovation.
Acreage releases – a hot topic in recent months – will include 2017 offshore acreage information by representatives from the Australian Government Department of Industry, Innovation and Science, Geoscience Australia and the Western Australia Department of Mines and Petroleum.
Day Three
Wednesday morning’s plenary will showcase an industry leaders panel from APPEA’s exploration and production member companies discussing the Australian oil and gas industry in transition; what it means for the industry globally and in Australia; and how their businesses are responding to the challenges and opportunities that arise during periods of change.
The session will be facilitated by former executive director of the International Energy Agency Maria van der Hoeven, with panellists from ExxonMobil, Senex Energy and BP Developments Australia.
The final plenary of the conference, ‘Addressing trust challenges and regulatory uncertainty’, will be facilitated by leading journalist Ali Moore, and will examine how serious trust challenges have affected the oil and gas industry.
Dr Roberts will then bring the three day conference to an end with his closing address.
Woodside chief executive Peter Coleman.
18 INDUSTRY PROFILESCOMPANIES GEARING UP
MAY 2017THE AUST�LIAN ENERGY REVIEW
VECTOR Energy, part of the Vector group in New Zealand, is bringing its proven track record in the integration of energy storage solutions to the Australian mining industry.
Vector Energy has one of the largest energy storage teams in Australia.
Utilising their knowledge, experience and technology, they can design, install, commission and integrate robust and
fit-for-purpose solutions for mining’s most stringent applications.
Delivering practical end-to-end solutions for its customers, Vector Energy has a full service offering including energy storage integration utilising innovative battery technologies, renewable hybrid power systems and microgrids, solar power generation, virtual power stations, performance monitoring and control and
project financing options for approved customers.
Vector Limited is leading the integration of disruptive technologies and has integrated one of the largest energy storage systems in the Southern Hemisphere utilising Tesla Powerpack. In October 2016, Vector integrated a 1MW/2.3MWh energy storage system on a substation that could help to reduce peak demand,
extend the life of the substation and provide supplementary power to improve reliability.
In terms of investment, it also allows Vector Limited to defer large-scale expenditure in conventional infrastructure that may in time become obsolete.
Vector Energy will work with individual clients to understand their businesses’ energy needs and offer a tailored solution.
IT is often only after “major weather events”, like the ones Queensland recently experienced, that we think about what we should be doing to protect our businesses before the worst happens.
When it comes to looking out for your water or wastewater treatment plant, an ounce of prevention is definitely worth a pound of cure and there a few things you should consider.
First and foremost, refer to the actions outlined in your Emergency Response Plan.
After that, consider some simple preparations to help you to provide continuity of service in the face of an impending weather event.
Regardless of the type of site you have, locate a reliable and good-sized torch and make certain you have fresh batteries.
Charge up any mobile phones and make sure all RT gear is in good working order. You might even consider investing in a “Divers” Pen which allows you to write on wet paper/in the rain.
We’d suggest you get in some sample bottles for EPA overflow samples and that you fill up your trucks and check tyres, batteries and water.
It’s also recommended that you have some reserve fuel and a trash pump on hand
with a good length of hose for both inlet and outlet.
If you have a wastewater treatment plant, look to remove any debris from the plant precinct and inspect and clear inlet screens for blockages or breaches.
Communicate to your supervisor any potential you see for non-compliance
(consent breach) and discuss an action plan. Consider implementing manual bypass mode &/or confirm automatic bypass mode operable.
For activated sludge STP’s, consider dosing the plant with 1000-2000 mg/L of powdered Zeolite, Bentonite, Calon or Quartz Dust to reduce biomass washout.
For trickle filter STP’s, consider replacing the end caps from the filter arms with 90 degree elbows during peak flow, as it is preferable to have a small localised dilute discharge onto a wall or trickle filter ring or drain rather than peeling (sloughing off) all your filter biofilm due to high hydraulic load shear forces.
If you have a water treatment plant, it is also a good idea to remove any debris. You’ll also want to think about holding an adequate stock of treatment chemicals at site to allow for higher consumption or interruption.
Perhaps do a ring around with other councils and organisations in your region to see where resources can be shared, if necessary. Consider running the plant (on manual if necessary) to fully charge all reservoirs and make sure to monitor raw water turbidity (maybe with some extra to normal samples from out in the catchment if possible, for maximum lead time before reaching the TP).
If you have the chance, review historical records for target chemical dose settings which have worked best with similarly “bad” quality raw water. Backwash all filters in advance of anticipated raw water quality deterioration, put the plant into slow mode and prepare to double the chemical dose.
Finally, make sure your jar testing gear is operational and your people are trained and ready.
Renewable energy solutions for mine sites
Dealing with weather events
Vector Energy delivers practical, end-to-end solutions.
The Plant Operations Team at Simmonds & Bristow
21MAY 2017
THE AUST�LIAN ENERGY REVIEW21STAINLESS STEEL
NITTO Kohki produces more than 20,000 different couplings to suit a vast range of applications worldwide.
From standard air fittings, fluid and gas couplings, to their specialised safety fittings – Nitto Kohki has its customers covered.
With stringent quality control, a prerequisite in Japanese manufacturing, these fittings have a reputation for their durability and longevity.
To assist industries that require Cuplas with alternative body material, Nitto Kohki has produced some of its most popular ranges in both brass and stainless steel.
It also produces lightweight plastic Cuplas, perfect for industries where minimisation of potential damage to paintwork is important.
“The Standard Hi-Cupla is the perfect all-rounder and handles a wide range of tasks from plant air piping to air hose applications,” Nitto Kohki Australia General Manager Brett Rokesky said.
“It is designed with a one way shut-off valve in the socket, and with its hardened materials makes it extremely wear resistant.
“For more specialised applications using stainless steel we suggest the SP Type A with two-way shut-off for medium viscosity liquids and gases or the TSP Cupla with its valveless structure, suitable for high viscosity fluids such as grease.”
With a simple and secure connection to braided hoses there is no hose clamp required.
“There are many cheaper alternatives out there, but at Nitto Kohki we stand by our product with a 12 month guarantee against leaks,” Mr Rokesky said.
“Put Nitto to the test and we will out-perform the competition.”
Get with the flow: demand Nitto
With stringent quality control, Nitto Kohki fittings have a reputation for durability and longevity.
23MAY 2017
THE AUST�LIAN ENERGY REVIEW23A DAY IN THE LIFE
Q. Describe your professional background in the energy industry.
I have held various executive management roles over the last 26 years in the European, Asian and Australian oil, gas and power industries with BP, Woodside, and most recently Horizon Power. I started at Horizon Power in 2006 as the general manager of Strategy and Business Development and took over as managing director in 2010. I was also recently appointed to the Board of Energy Networks Australia (ENA) and am chair of its Asset Management Committee.
I have also played a key role in Australia/China business relations and was the national chairman of the Australian China Business Council from 2008-2013. I am currently a member of the ANU China in the World Advisory Board.
For the last 11 years, I have lectured part-time in oil and gas economics, and oil and gas legal frameworks at the University of Western Australia and I am a member of the General Council of the Chamber of Commerce and Industry in WA.
I hold first class degrees in engineering, economics and business administration from Curtin University (WA), London School of Economics (UK) and AGSM (University of NSW).
Q. Tell us about your current role with Horizon Power and what a typical day
looks like for you.
My day typically starts with meetings at my favourite coffee shop around 6am if I am not travelling. If I am at one of our regional depots, which I am at least once a month, the day will start with a tool box meeting with the operational staff where we will emphasise safety, up and coming projects and issues, and work load for the day.
If I am in the Bentley office the day will usually include steering committees about key projects. If it is a Monday the day always starts with an executive meeting with my key direct reports and Manager Communications where we discuss the forward planner and any issues facing the team and the business.
I try to walk around the business as much as I can to check in with each team and division to see how they are tracking. Once a quarter I hold a “brown bag lunch” where staff from across the business are invited to have an informal lunch where they can ask me anything.
I get a lot out of those lunches – sometimes we ask the question – what would you do if you were MD? – I get a lot of sympathy as no one seems to want to do my job!
Q. In March, Horizon Power announced it was trialling two large-scale batteries at Mungullah Power Station. How is this trial
progressing?
The 2 MW /2MWh of batteries and their inverters arrived at our Mungullah Power Station in Carnarvon in March this year. The installation of the batteries, inverters and associated balance of plant is complete and we are currently in the process of commissioning the battery energy storage system (BESS).
The early news from commissioning has been very positive and we are excited about the possibilities. We are on track to enter the 12 month trial period at the beginning of May. Our primary objective is to prove that the BESS can operate as an effective replacement for conventional generation in the role of spinning reserve.
We will also test other operating modes of the BESS, including block shifting of energy and in a “solar smoothing” or hosting capacity function.
However, at this stage it is our primary aim to deploy the BESS to provide the power station’s spinning reserve, which will not only save fuel and maintenance costs but also delay expansion of the power station.
Q. How are renewable energy technologies, such as battery storage,
reshaping the energy industry?
The move to renewable energy is inexorable, and energy companies need to embrace the change or risk being left behind.
The challenge is to engage with renewable energy in a way that benefits both the consumer and the energy provider. I wouldn’t stake a claim that one particular technology or approach is the silver bullet for the renewable energy future. It’s likely to be a combination of technologies.
For example, Horizon Power has already deployed standalone power systems at the
fringes of our grid in Esperance. Elsewhere we believe that distributed energy resources, connected to the existing grid, are the best value solution.
I’ve described the role of energy storage for spinning reserve and it has so many other potential functions within an energy system. So it’s a matter of exploring the appropriate technologies and applications for different situation.
It’s also important to take calculated steps towards renewables, particularly for Horizon Power with our collection of microgrids. The wrong balance of renewables, applied without engineering rigor, can result in the collapse of these islanded power systems.
Q. Does Horizon Power have any other new projects in the pipeline?
Carnarvon DER
Horizon Power will soon be undertaking a series of trials in Carnarvon to explore the most economically efficient way to design and manage a future grid with very high levels of Distributed Energy Resources (DER) and reduced dependence on centralised fossil fuelled generation.
The trials aims to resolve the technical and transitional barriers to adopting a high penetration DER generation model and lower the overall system cost to supply.
The trials will enable Horizon Power to
better understand the impact of weather events on solar PV along with developing a model of renewable energy integration for towns such as Carnarvon that have reached their available solar PV hosting capacity.
Onslow
Onslow is set to be the home of Australia’s largest distributed energy resource microgrid which will target greater than 50 per cent of the town’s electricity needs to be serviced from renewable energy sources.
The Onslow microgrid will include a mix of distributed renewables, modular gas powered generation and battery storage aimed at achieving a high level of renewable energy across the town. These distributed resources will be accessible to both residential and business customers and create a new era of energy competition and efficiency not previously experienced by residential and business customers.
The ability to economically accommodate high percentages of distributed renewable energy is an enabling feature of the DER Microgrid, leveraging off the Government’s recent investment in Advanced Metering Infrastructure in the town.
The advanced meters are anticipated to play an important part in optimising the available renewable energy. Reliability and power quality will be front of mind as the contemporary system evolves.
WA regional energy provider Horizon Power’s managing director Frank Tudor has had a long and rewarding career in the global oil and gas industry. The seasoned executive spoke to Elizabeth Fabri about his typical day on the job, the role renewable energy will play moving forward,
and the company’s use of battery storage to future-proof their systems.
Frank TudorHorizon Power managing director
