Coal Seam Gas

Coal Seam Gas: An Overview

CSG is a new and developing source of natural gas worldwide. CSG is essentially natural gas generated and stored in coals.

CSG is largely comprised of methane and is suitable for the same uses as conventional natural gas.

The potential of New Zealand’s coals to produce CSG has been recognised for some time, and exploration work has been carried out since the mid 1980s.

L&M Energy's Coal Seam Gas Exploration

To date, L&M Energy has drilled over 50 exploration wells, conducted multiple 2D seismic surveys to ascertain prospectivity, conducted production testing across a number of permit areas, commenced its first pilot project and now holds CSG reserves of 274 petajoules (PJ) of gas energy contained with the Southland permit PEP 38220. These reserves were the first independently certified reserves in the country and represent the 3P reserve estimate for the permit (proven, probable and possible).

LME’s current assessment has indicated that the Southland CSG permits PEP38220 and PEP38226 have the potential to contain an energy resource in the order of 1,100 petajoules (3P).

OM #4 was drilled in 2010 to 1034m. This step out well intersected over 40m of gassy (11m3/tonne, 98 % methane) Cretaceous Morley coals and shallower Eocene-aged Beaumont coal measures. The results from this well support LME’s belief that the coals extend into the larger exploration permit, PEP 38226.