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Mud spills in CSG drill ‘spud’ spin

NO DOUBT: Locals gather in force at Doubtful Creek to contest a new Metgasco drilling operation.
NO DOUBT: Locals gather in force at Doubtful Creek to contest a new Metgasco drilling operation.

An eagle-eyed local is alleging that coal seam gas mining company Metgasco has made false representations to the Australian Stock Exchange (ASX) regarding its drilling operations at Glenugie.

In Metgasco's ASX announcement on Friday, January 11, it claimed to have 'spudded' a hole, widening it sufficiently to allow a drill bit big enough for an exploratory dig.

However eyewitness Alan Roberts, who was present at the ongoing vigil by local residents, alleges he has photos to prove that Metgasco's claims are untruthful. He said that Metgasco's efforts to spud the hole, commencing on January 9, had been foiled, apparently by the layer of basaltic rock known to underlie the Glenugie strata. He said that scrutiny of the drilling in their fortified and floodlit compound had shown frustrated workers hauling out mangled drill bits and at one stage, spilled mud. Heatstroke and mud overflows continued to hamper them on Friday 11 and it wasn't until 1.14pm on Saturday, January 12 that they were able to complete their schedule.

Metgasco's ASX announcement of 11/01/13 clearly states that the "Thornbill EO4 well was spudded" on January 10. With a $5 million dollar loss announced in November last year, Metgasco shares have reached their lowest levels ever during the Glenugie protests. A discernible rise in its share price this month corresponds to the allegedly premature 'spudding' announcement. Metgasco's external relations manager, former Liberal party powerbroker Richard Shields, declined to comment on its drilling schedule or the effect of community resistance, stating only via email that: "The drilling program ... is expected to conclude in the next week or so."

While the industry, led by peak body APPEA, continues to deny that there are any effects to either human health or environment from CSG mining, independent tests in north-west NSW have exposed dangerously high levels of ammonia, methane, carbon dioxide, lithium, cyanide, bromide and boron near a Santos CSG plant in (previously) pristine forest. An AAPEA spokesman admitted in August 2012 that CSG mining will impact on aquifers, but the line taken by Metgasco's CEO Peter Henderson has been to publicly reiterate that no such threats exist.

With community resistance growing across NSW, including eight more arrests at Glenugie on January 15 and a new fifty-person strong protest at Doubtful Creek, near Kyogle, the industry is pressing alarm buttons. In October 2012 the Business Spectator reported that EnergyAustralia CEO Richard McIndoe had said, "In 2014-15 it's going to be like someone took the plug out."

Community resistance to CSG mining is perceived as the greatest threat to an industry which sees CSG as the only option to stave off an energy shortfall. With consumer gas prices projected to increase by up to 10.4% in metropolitan areas and 6% in rural areas, the industry has committed to exploiting the 15,000 petajoules of CSG resources identified in NSW. The O'Farrell government is committed to the industry, in defiance of growing consumer interest in renewable power sources and the international embrace of renewable technologies.

But in the Northern Rivers, CSG mining is caught between a rock and an increasingly hard place.


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