'Tight gas' could be a bugbear at Grosvenor

THERE may be problems with “tight gas” at Anglo American’s Grosvenor longwall project in Queensland despite the project being ready for sale as part of the company’s exit from coal and CEO Mark Cutifani heaping praise on the project after the company’s first half results.
'Tight gas' could be a bugbear at Grosvenor 'Tight gas' could be a bugbear at Grosvenor 'Tight gas' could be a bugbear at Grosvenor 'Tight gas' could be a bugbear at Grosvenor 'Tight gas' could be a bugbear at Grosvenor

Anglo American CEO Mark Cutifani

Lou Caruana

Grosvenor is believed to be considering a fraccing trial this year as part of “borehole well stimulation” strategy, according to information provided to International Coal News.

It is believed the mine is encountering problems with tight gas through a fault zone at that end of the first panel, and has been forced to cut the block short.

An Anglo American spokeswoman declined to comment to International Coal News about tight gas at Grosvenor.

Tight gas could cause delays in accessing coal and reduce the return on investment in capital equipment, according to industry sources.

Low permeability, long drainage times, development problems and longwall discontinuity may also result from tight gas at an underground coal operation, the sources said.

Tight gas reservoirs are generally defined as having less than 0.1 millidarcy (mD) matrix permeability and less than 10% matrix porosity.

Cutifani reiterated last week that Grosvenor would not be offloaded in a fire sale.

He said the company would be sticking to “strict value thresholds” for any asset sales after price impairment of $US1.2 ($A1.6) billion relating to the Moranbah and Grosvenor coal operations contributed to Anglo American’s $364 million loss for the six months to June 2016.

He told an analysts’ briefing that Grosvenor produced 37,000 tonnes of coal in the half.

“So the project has been commissioned seven months early, under budget and certainly make a significant contribution,” he said.

“I think we will be careful in analyzing those sorts of numbers. You have got to remember you got longwall moves and that is a peak number, but so early in the commissioning, fantastic job.

“I'm really proud of what the guys have done at Grosvenor, for us I think it really helps demonstrate where we come from on projects and operations.”

The BHP Billiton Mitsubishi Alliance is being widely tipped to buy Grosvenor and the nearby Moranbah North mine and integrate them into their stable of Bowen Basin metallurgical mines and infrastructure.

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