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Project summary

Leigh Creek Energy plans to produce energy from coal using a process known as underground coal gasification (UCG), also known as In-situ Gasification (ISG). The UCG process converts coal from its solid state into a gaseous form, resulting in the generation of synthesis gas (syngas) containing methane, hydrogen and other components. The syngas is proposed to be used to either produce electricity directly or further refined into a variety of products such as ammonia.

Leigh Creek Energy in 2018-19 constructed and operated a UCG pre-commercial demonstration plant (PCD) at Leigh Creek, within the old mine site. This demonstration plant involved the establishment of a single gasifier chamber and associated above-ground infrastructure to produce syngas for a short period of time, to test the syngas composition and process performance to enable consideration of potential commerciality.

Any future exploration or UCG activities will be subject to relevant approvals under the Petroleum and Geothermal Energy Act 2000 (PGE Act) as outlined below. For further information on UCG the Department has published a brochure that gives answers to frequently asked questions.

Approvals

All prospective operators, prior to any on-ground activities, must adhere to the three stage approvals process under the Petroleum and Geothermal Energy Act 2000, which is outlined in the Guide to the licensing and approvals process for exploration, retention and production activities flowchart. >

Stage 1 - Licensing - APPROVAL GRANTED
Stage 2 - SEO Approval - APPROVAL GRANTED
        For: ISG Demonstration Plant; Exploration Drilling Operations; Geophysical Operations
No approval for Leigh Creek Energy’s Stage 1 Commercial Development SEO has been granted
Stage 3 - Activity Approval - NO SUBMISSIONS AT PRESENT

The Licence Approval process (Stage 1) grants exclusive rights to an area to explore for or produce resources but does not grant rights to undertake on-ground activities.

Leigh Creek Energy was granted its exploration licence, Petroleum Exploration Licence 650, in November 2014.

On 10 June 2020, Leigh Creek Energy applied for the grant of a petroleum production licence (PPL 269) for the purposes of carrying out commercial scale in-situ-gasification (also known as UCG) of the coal resources at Leigh Creek.

The Department for Energy and Mining (the Department) has assessed the application and subject to independent expert advice has determined that Leigh Creek Energy has satisfied the criteria under the PGE Act for the grant of a production licence.

Further information can be found in the following frequently asked questions (FAQ) document, prepared by the Department.

Grant of Petroleum Production Licence and Associated Activities Licence - FAQs
Download the Grant of Petroleum Production Licence and Associated Activities Licence
Frequently Asked Questions (PDF 514KB)

Further information on the Licensing process is available on the license applications page.

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All regulated activities conducted under the PGE Act must have an approved Statement of Environmental Objectives (SEO) in place with which they comply, prepared on the basis of an Environmental Impact Report (EIR). Leigh Creek Energy has approved SEO’s for their completed In-situ Gasification (also known as UCG) Demonstration Plant, Geophysical Operations and Drilling Operations in PEL 650.

Leigh Creek Energy, ISG Demonstration Plant, April 2018 Leigh Creek Energy, Exploration Drilling Operations - PEL 650, March 2020 Leigh Creek Energy, Geophysical Operations - PEL 650, September 2020
Statement of Environmental Objectives
Download the Statement of Environmental ObjectivesDownload the Statement of Environmental ObjectivesDownload the Statement of Environmental Objectives
Environmental Impact Reports
Download the Environmental Impact ReportDownload the Environmental Impact ReportDownload the Environmental Impact Report

For any future UCG proposals, Leigh Creek Energy will be required to develop a new EIR and SEO for the proposed gasification operations under the PGE Act.

Leigh Creek Energy on the 6 May 2021 submitted a new EIR and SEO for their proposed Stage 1 Commercial Development which involves UCG of coal at the Leigh Creek coalfield and construction of a small scale (<5MW) power generation plant. Through this project Leigh Creek Energy intend to demonstrate the technical and financial capability of producing syngas at a commercial scale.

DEM, with co-regulators, have commenced assessment of the EIR and SEO in accordance with Petroleum and Geothermal Energy Act 2000.

The project was also referred to the Independent Expert Scientific Committee (IESC) for advice under the National Partnership Agreement on Coal Seam Gas and Large Coal Mine Development.

Once available, the IESC advice will be made available on the following website - https://iesc.environment.gov.au/advice/scientific-advice

For further information on the approvals process, including relevant stages and consultation requirements, please see the activity approval process.

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Whilst approval of an SEO is a significant step within the approvals process, this still does not provide rights to Leigh Creek Energy to begin on-ground works. To do this, Leigh Creek Energy are required to proceed to the third and final approval stage to obtain approval to commence on ground activities. This entails submission to the Department for evaluation and approval of all technical and engineering designs relating to the proposed activity to ensure the design and intended construction and monitoring of all surface facilities, pipelines, and wells are in accordance with recognised industry standards and fit for the purpose for achieving the requirements of the final approved SEO and conditions.

The stage 3 approval process includes, evaluation and approval of the licensee’s Environmental, Health and Safety Management Systems, monitoring plans, shut down and decommissioning plans, environmental assessments, environmental management plans, rehabilitation plans, cultural heritage assessments and emergency response procedures that are critical to the demonstrable achievement of the relevant SEO.

Under Stage 3, the licensee is also required to notify all relevant landowners about its intentions to undertake any regulated activity and to clearly describe pursuant to the requirements under Part 10 of the PGE Act, the nature of its activities to be undertaken, the potential impacts those activities may have on the landowner and the right of the landowner to dispute such entry including any compensation that may arise from such activities.

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Environment Protection and Biodiversity Conservation Act Assessment

Leigh Creek Energy referred its proposal to the Commonwealth Department of Agriculture Water and Environment (DAWE) for decision under section 75 of the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act). In response, DAWE determined this project to be a controlled action and, as such, it will also require assessment and approval under the EPBC Act. It will be assessed on Preliminary Documentation under Division 4 of Part 8 of the EPBC Act. For further information on this referral and the regulatory decisions under the EPBC Act, please visit the DAWE website.

Frequently asked questions

The following frequently asked questions aims to provide the public with easily accessible and comprehensive responses to a range of questions asked by the public in relation to underground coal gasification. If you have a relevant questions not answered in the document, please contact us at DEM.Petroleum@sa.gov.au.

Underground coal gasification in South Australia (PDF 351 KB)

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