JV to assess Sydney Basin for CBM

A JOINT venture comprising Apex Energy, Australian Coalbed Methane and Sun Resources has won a license allowing it to assess an area in the Berrima-Burragorang region (west of Camden) of the southwest Sydney Basin for coalbed methane (CBM).

Steve Rotherham
JV to assess Sydney Basin for CBM

Apex Energy NL is the operator and majority stakeholder with a 56% interest. Australian Coalbed Methane Pty Ltd, a wholly-owned subsidiary of Carbon Minerals NL, has a 30% stake while Sun Resources NL has 14% interest.

The area covers about 1,278 square kilometres but the joint venture partners expect numerous exclusions to this, including national parks and existing colliery holdings.

Very little work has been done on CBM in this part of the Sydney Basin, according to Australian Coalbed Methane company secretary Steven Danielson.

But biogenic methane – or methane generated by organisms – is now known to be a significant component of the CBM found in the Sydney Gas leases not far to the east of the Berrima-Burragorang region.

Danielson said some scientists believed the biogenic gas resulted from the entry of bacteria-laden meteoric waters from the basin margins and from faults and major fracture systems. Based on carbon isotope determinations, gas from Burragorang Valley mines has an extremely strong biogenic signature, he said.

"It is considered that this area offers potential for shallow methane resources generated by microbes which have entered the coal seams with groundwater," Danielson said.

"The deeply incised topography of much of this region results in extensive exposure of coal seams which in turn facilitates the entry of water and microbes. Additional microbial gas potential exists in abandoned coal mine workings within the application area."

The assessment will be done under a petroleum special prospecting authority (PSPA) license, a special form of tenure introduced in NSW to encourage petroleum exploration of areas where prospectivity may be marginal or where the exploration is based on unconventional or speculative concepts.

The tenure has a one-year period, after which - if warranted - the holder can proceed to the more normal form of petroleum exploration tenure, a Petroleum Exploration Licence (PEL) which can have a term of up to six years (and is renewable in reduced format thereafter).

The project operator for the PSPA venture will be Apex Energy NL.

In early 2004, Apex and Sun discovered potentially commercial gas from old coal mine workings in the Bulli Seam of the former Darkes Forest coal mine near Coalcliff between Wollongong and Sydney.

Apex's Darkes Forest-1 well flowed 1.2 million cfd of 82% methane and the drill hole, has been completed as a future gas producing well.

Apex Energy is presently an unlisted public company, but is seeking ASX flotation early in 2005. It has an 80% interest in PELs 442 and 444, and CCLs 703 and 379 which comprise the southeast Sydney Basin seam gas project.

The joint venture has engaged Sydney-based mineral exploration consultants Earth Resources Australia Pty Ltd (ERA) to execute the PSPA program which will be non-invasive. At the conclusion of this work a decision will be made regarding the merit of proceeding to a Petroleum Exploration Licence.

ERA, formed in 1971, has particular expertise in seam gas exploration, and in addition to managing all of Australian Coalbed Methane's seam gas work in the Gunnedah, Murray and Surat Basins, is also engaged by Apex Energy on the south-east Sydney Basin seam gas project, where it was involved in Apex's Darkes Forest-1 discovery well.


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