Clean Coal Victoria
NOVEMBER 2009
Clean Coal Victoria open in the Latrobe Valley
Resources Victoria Conference Resouces industry set to grow
Esso Australia VICTORIA’S EARTH RESOURCES JOURNAL
D I S COVE RY
40 Years of production from the Bass Strait
Northgate Minerals Corporation Victoria’s biggest gold miner
Geogen Victoria Geothermal hotspot in Ballarat
Beaconsfield Gold Exploration near the Grampians
Clean Coal Victoria
SPECIAL FEATURE
REGULARS
Minister’s Foreword
News Updates
Tenement Updates
Peter Batchelor Minister for Energy and Resources
PAGE 3 TO 7
What’s happening with mineral applications and licences
PAGE 2
• Well-oiled research plans to dip into new reserves
Executive in Focus Dr Len Humphreys Ignite Energy Managing Director PAGE 7
• 2009 Strzelecki Awards
• Ballarat might be a geothermal hotspot • Mining industry regulation in the spotlight • DPI appoints new Deputy Secretary
PAGE 32
Contacts Your guide to Earth Resources. Information, contacts and resources sector websites PAGE 33
• GeoScience Victoria wins prestigious national award
CONTENTS
• Victoria rocks the Hungarian President
FEATURE SECTION
Above: Cover: Coal mining in the Latrobe Valley
For Discovery online visit: www.dpi.vic.gov.au/minpet/discovery or to receive your free copy send your details to: Gordon Chakaodza Senior Resources Development Officer Department of Primary Industries Phone: 03 9658 4401 Email:
[email protected] PUBLISHING DETAILS Discovery is published three times a year by the Victorian Government Department of Primary Industries, Earth Resources Division, Melbourne, November 2009. ISSN Number 13282409 For more information contact: Department of Primary Industries Level 16, 1 Spring Street, Melbourne 3000. www.dpi.vic.gov.au DISCLAIMER This publication may be of assistance to you, but the State of Victoria and its officers do not guarantee that the publication is without flaw of any kind or is wholly appropriate for your particular purposes and therefore disclaims all liability for any error, loss or other consequence which may arise from you relying on any information in this publication. This publication is copyright. No part may be reproduced by any process without the written permission of the Department of Primary Industries. ACKNOWLEDGMENTS The Earth Resources Division acknowledges contributions made by private enterprise. Acceptance of these contributors, however, does not endorse or imply endorsement by the Department of Primary Industries of any product or service offered by the contributors.
ARTICLES
The combination of strategic planning around Victoria’s coal resource and significant investment in new technologies and uses will ensure Victoria’s coal resource can continue to be a significant contributor to the Victorian economy.
Esso Australia
Clean Coal Victoria
Gold pours in June quarter
40 years of oil and gas production in Bass Strait PAGE 8 – 9
Northgate Victoria’s biggest gold miner PAGE 18
Bendigo Mining
Clean Coal Victoria open in the Latrobe Valley
PAGE 19
PAGE 10 – 11
Exploration near the Grampians
Carbon Capture and Storage
PAGE 20 – 21
CCS research funded for further five years CO2 capture technology developed in the lab PAGE 12 – 13
Cutting CO2 emmissions Power plant technology cuts CO2 emissions PAGE 14
Coal to Liquids Project Ignite Energy PAGE 15
Future Coal Infrastructure Gippsland Regional Infrastructure Development Studies PAGE 16
Latrobe Valley looks to reduce carbon footprint PAGE 16
Young researchers gather in Lorne PAGE 17
Beaconsfield Gold GeoScience Victoria Geological ‘Skeleton’ of Gippsland Basin to be revealed PAGE 22
New areas released for offshore oil and gas exploration PAGE 23
2009 Resources Victoria Conference Summary Victorian oil and gas exploration set to grow PAGE 24 TO 31
DEPARTMENT OF PRIMARY INDUSTRIES
VicGCS Victorian Geological Carbon Storage A new initiative to assess Victoria’s geological carbon storage (GCS) potential and resources l
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Understanding containment, injectivity-capacity, and CO2 and hydrocarbon migration Developing a Basin Resource Management Framework - Geoscience information and knowledge systems to allow informed management of basins as multiple use zones, enabling the GCS, geothermal, petroleum and water sectors to co-exist and prosper - Basin-scale to allow assessments to be made of potential impacts and relative values of all relevant earth resources
For more information: - Contact Dr Geoff O’Brien Phone: + 61 3 9658 4537, Email: geoff.o’
[email protected] - Visit www.vicgcs.dpi.vic.gov.au Image: Carbon storage acreage in the Gippsland Basin, showing potential migration vectors for injected CO2
Victoria’s energy and earth resources sectors remain open for business and are forging ahead with a number of pioneering initiatives.
MINISTER’S FOREWORD
Clean Coal Victoria Established by the Brumby Government to help unlock the value of Victoria’s coal resource in an environmentally sustainable manner, Clean Coal Victoria (CCV) is now up and running in the Latrobe Valley. CCV is now a focal point for coal industry stakeholders in the valley. Sustainable development of the state’s coal resource will enhance the economic future of the Latrobe Valley. Peter Batchelor Minister for Energy and Resources CCV is a dedicated organisation that will plan for the long-term extraction, development, use and rehabilitation of Victoria’s vast and valuable coal resources, while considering the interests of the communities in which existing and future coal industries operate. To develop a plan for the future use of this resource, CCV will work with local government, industry, the local workforce and community groups. The Brumby Government is providing $12.2 million over four years for the establishment and operation of CCV.
Latrobe Valley Energy Summit In July, CCV organised the successful Latrobe Valley Energy Summit, an important step in bringing together stakeholders to discuss the future use of Victoria’s brown coal. Government, industry, union and worker representatives at the Traralgon event discussed ways to drive job growth and investment as Victoria’s energy industry moves to a lower emission, more sustainable future. The Brumby Government is committed to the Latrobe Valley energy industry and to working with the community to create the right climate for new investment in the region. Summits such as the Latrobe Valley Energy Summit ensure that industry and workers participate in debate around changes to their industry and can help drive, and take advantage of, new investment and jobs in clean coal developments.
Geothermal developments Exploration commenced recently to determine whether Ballarat and its surrounds would be a promising hotspot for future geothermal energy generation in Victoria. During a visit to Geogen Victoria’s geothermal exploration site at Mt Buninyong, south of Ballarat, I was able to see the latest geothermal thermal logging tool being used. The Brumby Government has awarded more than 20 permits, covering a large part of the state, to geothermal companies to explore for commercial geothermal resources. Geothermal explorers are also eligible for grants under round three of our Rediscover Victoria Drilling Grants program, which offers industry further support for innovative resources exploration. Successful proposals for round three will be announced by January 2010. The Rediscover Victoria initiative is investing $5 million over four years to June 2011 in geoscience projects that encourage exploration. This is being used for the Drilling Grants program and for 3D geological modelling of Victoria. 2
DISCOVERY JOURNAL NOVEMBER 2009
Victoria’s energy and earth resources sectors are key parts of the state’s energy supply system. Over the past six months, the Brumby Government has continued to work in partnership with industry and the community to create new jobs and drive new investment in both sectors as Victoria transitions to a low-emissions future.
Geoscience milestones A number of companies which received first – and second – round Rediscover Victoria Drilling grants to search for minerals, including gold and copper, are expected to soon release reports on their drilling results. The Brumby Government also continues to invest in a number of initiatives designed to support exploration and resource development across the state. One of the world-class tools being delivered by GeoScience Victoria is a whole-of-Victoria 3D geological model, as part of the $2.5 million Rediscover Victoria 3D initiative. This is already assisting explorers with a better understanding of the geology and how it hosts the state’s great energy and minerals systems. Three dimensional modelling is well advanced in the west of the state with the Bendigo region released and western Victoria due for release shortly.
Resources Victorian Conference Following the success of last year’s inaugural Resources Victorian Conference, the Brumby Government was again the host sponsor of the second annual event held earlier this year in August. The conference was again well attended and provided the perfect opportunity to showcase the major investment opportunities for both emerging and established earth resources in Victoria. The three day multi-commodity event featured a variety of leading industry presenters and exhibitors. The technical forum on the third day of the conference attracted more than 300 delegates. Delegates at the technical forum were informed about the promising work being done by GeoScience Victoria (GSV). Presentations from the technical day are available free of charge from the Online Store. This work includes the Gold Undercover study, which looked at possible gold deposits under sediment in northern Victoria – a valuable tool for gold explorers in coming years. GSV also released reports at the conference on the latest research and modelling work being done in the Gippsland Basin around its potential for carbon storage, copper prospectivity in Western Victoria, new research into Victoria’s rock origins and how they link to Tasmania; and leading 3D geological interpretations. To obtain copies of reports from the conference visit the Earth Resources Online Store at http://dpistore.efirst.com.au/ I hope you enjoy the November edition of Discovery magazine.
Peter Batchelor Minister for Energy and Resources
2009 Strzelecki Awards: Recognising excellence in sustainable development
L to R: Cameron McCormick – Austral Bricks Chris Bryant – Austral Bricks
NEWS UPDATES
Micheal Gerner – Austral Bricks/Golder Associates David Kidd – Ilkua David Sleigh – Iluka Colin Bullen – Imerys Minerals Australia Minister Peter Batchelor
Austral Bricks, Iluka Resources and Imerys Minerals have been recognised for their commitment to sustainable development through the Victorian Government’s 2009 Strzelecki awards. The awards were granted at the RIU Paydirt Resources Victoria Conference, by Energy and Resources Minister Peter Batchelor. Austral Bricks received the award in the Large Earth Resource Operation Category for its Scoresby quarry rehabilitation project. In the Medium Sized Earth Resource Operation Category, Imerys Minerals Australia won the award for its water recycling scheme at its Pittong mine, about 35 kilometres south-west of Ballarat and its donation of an unused facility for users of the Ballarat to Skipton rail trail. The award granted for the Exploration Projects category and a commendation in the Large Earth Resources Operation Category were granted to Iluka Resources for its environmentally-sustainable exploration works at its Douglas site, about 80 kilometres south of Nhill. The Strzelecki Awards recognise and encourage the sustainable development of Victoria’s earth resources.
Mr Batchelor said, “The Strzelecki Awards recognise companies that are taking sustainable development beyond what is required through legislation and showing a genuine commitment to the communities and environment in which they operate.” “This year’s winners have proven they are leaders in sustainable development and I hope they provide an example to other resource operators about how projects can be undertaken.” Mr Batchelor said Austral Bricks/Golder Associates has rehabilitated the former clay quarry site beyond the minimum requirements, converting the site so it could be used for residential housing in the City of Knox. Imerys Minerals Australia mines kaolin products at its Pittong mine. It won the award for two projects – its innovative water recycling scheme and the refurbishment of company facilities for public use along the Ballarat to Skipton rail trail. “Imerys identified a water source at its former open cut mine in Lal Lal and then organised water testing and infrastructure development to provide additional water to one of the region’s major water supply reservoirs,” Mr Batchelor said.
The company also donated an unused office facility at the Pittong plant which has been converted into a free sleep-over shelter and toilet along the Ballarat to Skipton rail trail. Mr Batchelor said Iluka Resources took out the exploration projects category for its work in the Little Young’s State Timber Reserve. “Iluka’s Douglas mineral sands deposit extends to this timber reserve. A special drilling and sampling program designed to find out more about the mineral sands deposit took into account the environmentally sensitive nature in the area,” he said. “This included delaying the drilling program to ensure it did not disturb the endangered Red Tailed Black Cockatoo breeding season and drill testing being carried out without any damage to or removal of trees. “Iluka also received a commendation in the large earth resource operator category for work at its Douglas Mineral Sands and Hamilton Mineral Separation Plant which included water recycling and energy conservation,” he said. For more information contact
Sarah Hill Department of Primary Industries Phone: 03 9658 4432
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Well-oiled research plans to dip into new reserves
NEWS UPDATES
Exploration activities have begun to determine whether Ballarat and its surrounding areas are potential hotspots for future geothermal power generation. Geogen Victoria Pty Ltd has commenced a geothermal exploration program in the Ballarat region to log temperatures in shallow drilled wells to determine if there is potential to generate clean electricity from geothermal resources. Above: A 3D model showing oil and gas flow pathways and accumulations in the Gippsland Basin.
A new research partnership between CSIRO and the Victorian Department of Primary Industries (DPI) will delve deep into the energy secrets contained within Victoria’s sedimentary basins. This research will have implications for a number of energy resource sectors, including oil and gas, geological carbon storage and geothermal. The oil and gas component of the three year agreement aims to assist energy companies to more effectively explore for new oil and gas reserves, reduce exploration risk and thereby encourage investment in Victoria. It was signed by CSIRO Petroleum Resources Deputy Chief, Dr David Whitford and Victorian Department of Primary Industries Deputy Secretary, Richard Aldous. CSIRO project leader, Dr James Underschultz, said that the CSIRO had the research expertise and laboratory facilities to evaluate all aspects of petroleum systems, from source rock to reservoir. “CSIRO techniques will measure various properties of rock cores, organic mater, and formation fluids,” Dr Underschultz said. “They will model the geological histories of Victoria’s basins, including the generation, migration and trapping of oil and gas. This will improve the characterisation of the detailed mechanisms that drive the petroleum systems in Victoria’s sedimentary basins and thereby potentially contribute to an improved assessment of the resource potential and inventory”. Victorian Minister for Energy and Resources Peter Batchelor said that finding new petroleum reserves is a key challenge of national importance to the oil and gas industry and Australia’s energy security. 4
Ballarat might be a Geothermal Hotspot
DISCOVERY JOURNAL NOVEMBER 2009
“Not only will the research be of benefit to Victoria, but the advanced integrated technologies developed in the program can be applied to other sedimentary basins throughout Australia,” the Minister said. “Our understanding of the potential for geological carbon dioxide storage and geothermal resources will also be boosted by information gathered from the research program.” Project leader for DPI, Dr Geoffrey O’Brien, said that the Department has high-level expertise in characterising the regional geologic framework of sedimentary basins in the state, within which the petroleum, geothermal and geological carbon storage systems occur. The integration of the regional geological understanding with CSIRO’s advanced analytical technologies would provide great momentum in understanding these complex systems, Dr O’Brien stated. DPI also has an extensive dataset that will allow a 3D model of the State’s sedimentary basins to be built. Dr Underschultz said that the two organisations share complementary skills, expertise, facilities and background facilitating a more comprehensive petroleum systems analysis study. The project is expected to be completed in 2011. Information will be released to the public through the DPI website as the research program progresses. For more information contact:
Dr Jim Underschultz CSIRO Petroleum Resources Phone: 08 6436 8747 Email:
[email protected] Dr Geoff O’Brien Department of Primary Industries Phone: 03 9658 4537 Email: geoff.o’
[email protected]
Victoria’s geothermal exploration sector is growing rapidly, with both acreage releases revealing spirited interest and high quality competition. Energy and Resources Minister Peter Batchelor visited the Geogen site in mid-July 2009. “Generating power from geothermal resources has the potential to play an important role in changing the energy mix in Victoria, as we look to new technology and new energy sources that can provide clean and reliable energy,” said the Minister. “The development of the geothermal energy industry in Victoria will also create jobs and opportunities for new investment.” Geothermal energy is a clean energy source generated from naturally occurring heat within the Earth. This heat can be harnessed to produce energy without emissions to the environment. Geogen Victoria has developed a unique new tool to aid in the search for geothermal energy resources. Working with Monex Geoscope, which operates out of Monash University, the company has developed highly sensitive thermal measuring equipment, which is mounted on a new logging vehicle. The thermal logger will accurately and cost-effectively measure the heat flow in the Earth’s crust to a depth of up to 600 meters. Mr Batchelor said that although the geothermal industry was still in its infancy in Victoria, it had significant potential. So far seven companies have been granted geothermal exploration permits in Victoria over more than 70 per cent of the state. For more information contact:
Andrew Carroll Geogen Victoria Phone: 07 3374 3110 or 0438 878 848
DPI appoints new Deputy Secretary
Dr Peter Redlich continuing as Director. The new Energy Resources Development Division has been created to coordinate and drive new energy resources developments, to provide a stronger focus on the challenges and opportunities for investment in Victoria’s world-class brown coal, petroleum and carbon capture and storage (CCS) resources, and the prospects for geothermal energy.
Industry briefings on new and existing regulatory requirements for exploration, mining and quarrying in Victoria have been held around the state by Department of Primary Industries (DPI) staff. DPI Acting Executive Director, Earth Resources Division, Doug Sceney said that the information sessions were held in Melbourne, Benalla, Bendigo, Traralgon and Ballarat, and included information on new guidelines and initiatives. “A broad review of the regulatory framework for the mineral industry is currently being undertaken by DPI,” Mr Sceney said. “The information sessions included an interactive discussion about the Mineral Resources (Sustainable Development) Act 1990 (MRSDA) review, with industry feedback to be considered as part of the review.” From January 1, 2010, the Extractive Industries Development Act 1995 (EIDA) will be repealed and extractive industries will be regulated under new provisions in the MRSDA. Mr Sceney said that the new Code of Practice for Small Quarries, which was introduced on July 1 and came out of the recent EIDA review, was a focus of the information sessions. “The Victorian Government is keen for new regulations to strike the right balance between cutting red tape for industry and minimising the impact of quarrying and mining activities on local communities,” he added. The information sessions also covered: • The rehabilitation bond calculator; • Community engagement and the duty to consult; and • Native vegetation management guidelines. For more information contact:
Doug Sceney Acting Executive Director, Earth Resources Division Phone: 03 96584451 Email:
[email protected]
Above: Richard Aldous, the new Deputy Secretary, Energy and Earth Resources Group.
Following a detailed review of the structure and organisation of the Energy, Earth Resources and Major Projects Group within DPI, the group has been renamed as the Energy and Earth Resources Group (EER). Richard Aldous has been appointed Deputy Secretary, Energy and Earth Resources. Richard has been acting Deputy Secretary since January 2009 having previously been in the position of Executive Director Earth Resources Division. Former Deputy Secretary Dale Seymour has taken up an appointment with the Department of Innovation, Industry and Regional Development (DIIRD). The new name and other changes to the Group are designed to meet the unprecedented innovation and investment task facing Victoria. The task of transforming Victoria’s energy sector is driven by the Commonwealth’s expanded Renewable Energy Target and planned Carbon Pollution Reduction Scheme during a period of increased demand for energy.
NEWS UPDATES
Mining industry regulation in the spotlight
The responsibilities of the new division will include the management and oversight of Clean Coal Victoria, the coordination of CCS activities across EER, facilitation of energy resources development projects, and the marketing and promotion of new investment opportunities in earth resources across the state. Effective regulation and the development of world class geoscience information for Victoria’s earth resources remains a key goal for the Earth Resources Division. To further support this objective, the Earth Resources Policy and Legislation unit will transfer to the Earth Resources Division from the Energy Sector Development Division. This shift is aimed at improving the integration and development of earth resources policy advice and the generation of legislation and regulations. The changes to the Energy and Earth Resources Group will enable DPI to build on its considerable achievements by providing a stronger focus and new capabilities to meet the challenges ahead. For more information contact:
Denis Billings Manager Business Strategy Phone: 03 9658 4674 Email:
[email protected]
EER will comprise the following four divisions: • Energy Resources Development, a new division with Cliff Kavonic as Acting Executive Director • Energy Sector Development, with Marianne Lourey continuing as Executive Director • Earth Resources, with Doug Sceney as Acting Executive Director • Energy Technology Innovation, with
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Victoria rocks the Hungarian President
NEWS UPDATES
GeoScience Victoria wins prestigious national award
Above: President Solyom (left) and Minister Batchelor watch the 3D visualisation presentation by GeoScience Victoria.
GeoScience Victoria’s (GSV) research in 3D modelling has attracted international interest on a presidential scale. Above: Dr Geoff O’Brien accepts the award for best technical paper at the APPEA conference.
A new geological concept with the potential to revolutionise the way explorers look for gas in Victoria’s Otway Basin has earned GeoScience Victoria’s Dr Geoffrey O’Brien a major industry award. Dr O’Brien, who manages GeoScience Victoria’s (GSV) Energy Geoscience group, was the joint winner of the award for best technical paper at the Australian Petroleum Production and Exploration Association (APPEA) conference recently held in Darwin. Dr O’Brien’s paper discussed the ‘yet to be discovered’ oil and gas potential of the Otway basin and presented new ideas about where and how hydrocarbons in the basin originated. GSV director Kathy Hill said, “He has also developed a predictive model for estimating the likely liquids and carbon dioxide contents of gas accumulations across the basin.” Dr O’Brien has more than 20 years’ experience in petroleum exploration, having worked for BHP, Western Mining Petroleum, AGSCO/Geoscience Australia and the University of Adelaide.
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DISCOVERY JOURNAL NOVEMBER 2009
He has also consulted to a wide number of companies in Australia and overseas. “Dr O’Brien has particular expertise in applying integrated petroleum systems approaches to basin evaluation, with an emphasis on basin and migration modelling, remote sensing, fault and top seal analysis and seismic interpretation of hydrocarbon leakage and seepage,” Ms Hill said. Dr O’Brien has won numerous industry awards and was the 1992 Petroleum Exploration Society of Australia lecturer. He has also published more than 170 papers and abstracts. His presentation at the APPEA conference coincided with the recent release of oil and gas acreage for exploration in offshore Commonwealth waters in the Victorian Otway Basin south of Warrnambool and Portland, adjacent to Victoria’s highest yielding gas fields. For more information contact:
Kathy Hill Director Geoscience Victoria Phone: 03 9658 4562 Email:
[email protected]
Energy and Resources Minister Peter Batchelor recently hosted the President of the Republic of Hungary, Laszlo Solyom, on a tour of GSV’s 3D visualisation facility. President Solyom expressed a strong interest in learning about Victoria’s work in geological carbon storage and geothermal energy. His Excellency shares similar interests with Minister Batchelor in terms of making the best use of his country’s considerable brown coal and geothermal resources, whilst making deep cuts in carbon emissions. Follow-up international collaboration is now planned, with the President inviting Victorian representatives to a Hungarian conference taking place next year, which will include discussions on lignite, or low-rank brown coal, a resource common to both Hungary and Victoria. For more information contact:
Kathy Hill Director Geoscience Victoria Phone: 03 9658 4562 Email:
[email protected]
Ignite Energy is one of the new generation companies seeking to commercialise brown coal as a base for the production of clean burning fuels plus lower emission power generation fuel. Dr Len Humphreys is one man leading the charge.
EXECUTIVE IN FOCUS
Dr Len Humphreys Ignite Energy Managing Director
The push to develop Victoria’s vast brown coal reserves has thrown up a range of new concepts with a host of new generation projects emerging, all aiming to utilise the energy resource that has underpinned Victoria’s economy for almost a century. Ignite Energy is one of the new generation companies seeking to commercialise brown coal as a base for the production of clean burning fuels plus lower emission power generation fuel. Ignite Energy Managing Director Dr Len Humphreys is one man leading the charge into Victoria’s low emissions future. A self-proclaimed change agent, Dr Humphreys has great confidence in Victoria’s future as a supplier of energy to the rest of the country. He describes his career achievements in terms of changing, integrating, positioning, promoting and developing organisations within a climate of uncertainty and demanding international and local competition. That certainly fits the changing nature of Victoria’s brown coal sector. Dr Humphreys holds dual British/ Australian citizenship but graduated with a Chemical Engineering degree from Teesside University in the UK, later obtaining a UK post graduate Certificate of Education from Durham University. He is now a full member of the Royal Society of Chemistry. In October 2006 Dr Humphreys was appointed Chief Executive of Ignite Energy Resources and Licella, a subsidiary of the Australian Biodiesel Group. Before entering the biodiesel arena Dr Humphreys was Managing Director of the IBA Health group, and before that Chief Executive of the Australian and UK stock exchange listed company Novera Energy. He remains a Director of the ASX listed Australian Biodiesel Group, Australia’s largest producer of biodiesel and the only listed biodiesel company that owns its own intellectual property. Dr Humphreys invested in the company before it joined the ASX, had a market value of around $A5m and employed only 5 people.
The company now has two operational plants and a market cap of $A80m, as well as having established a Canadian and US subsidiary and signed a joint development agreement worth $US50m to develop several new biodiesel plants in North America. Ignite Energy Resources (IER) will demonstrate its coal-to-oil technology after entering into a Memorandum of Understanding to develop a commercial test plant at TRUenergy’s Yallourn mine. The facility will use IER’s proprietary supercritical water technology to transform up to 60,000 tonnes of high moisture content brown coal into high-grade oils and high-grade dry coal. IER’s operating reactor at Somersby, NSW, converts one dry ton of Gippsland basin coal into approximately two barrels of oil and 600 kg of high ranked coal. Dr Humphreys said recently that the proprietary supercritical water technology IER is developing can transform low ranked brown coals into high-valued oils and cleaner coal products. “I guess you could say we mimic or copy nature. What it takes nature millions of years to do naturally, we can do in a minute,” he explained. “At a certain pressure and temperature, water changes from being very harmless to being quite an aggressive acid and alkaline simultaneously. At these conditions the water actually ‘de-pluralises’ the brown coal and converts it into three products: highgrade coal, a group of oils and water.” “The energy density of our coal is about twice that of brown coal. You can significantly reduce the carbon dioxide footprint of a traditional brown coal power plant,” he said. According to independent expert reports, the company’s coal can reduce carbon dioxide emissions by 40% when used for power generation. “It can also turn a low-grade substance into high-grade products suitable for export,” Dr Humphreys added. The technology could also have huge ramifications for the global oil market.
“Victoria alone has 25% of the world’s brown coal. These reserves have a greater oil potential than all of the Middle East put together,” Dr Humphreys said. IER has developed, and currently has in operation, a patent pending continuous flow cat-HTR that converts lignite (or brown coal) into oil and coal products. Pulverised lignite is fed into a reactor and, under medium thermal and pressure conditions and in the presence of a catalyst, the inherent water in lignite breaks down its polymeric structure, transforming it into IER’s coal and oil products. The process therefore turns lignite’s greatest weakness, its moisture content, to its advantage. Speaking as the former CEO of the Australian Biodiesel Group, Dr Humphreys said, “There’s huge pent up demand for biodiesel.” He says there is now a different excise regime depending on whether you’re on or off the road, and in or out of town. “For agricultural applications like farming, mining or marine, there is no rebate on biodiesel, whereas if they use fossil diesel they get a rebate of 38 cents.” If the ambitions of Ignite Energy and a number of other companies interested in non-traditional uses of Victorian brown coal are successful, Dr Humphreys will have added another significant chapter to his career history working as a change agent. For more information contact:
www.igniteer.com Ian Westbrook or Cherry Dinh Westbrook Communications Phone: 02 9231 0922 Carl Kitchen TRUenergy Phone: 03 8628 1079
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Esso Australia
Esso Australia 40 years of oil and gas production from the Bass Strait
Above: Drilling.
Esso Australia, an ExxonMobil Australia subsidiary, and BHP Billiton have celebrated 40 years of oil and gas production from Bass Strait at a special ceremony at the Longford gas processing plant near Sale. In the four decades since the first Bass Strait gas was piped to homes and businesses in Melbourne via the processing plant at Longford, almost four billion barrels of crude oil and seven trillion cubic feet of natural gas have been produced. The first home was connected to Bass Strait natural gas on April 14, 1969, making front-page news right around the country. The first oil flowed later that same year. At the Longford celebration former Esso Australia Chairman, Mark Nolan said, “Esso and BHP Billiton are proud of our 40 year association with the Victorian community via our operations in Bass Strait.” The Bass Strait operations have generated around A$300 billion in Federal Government revenues in real terms, and been a major contributor to Australia’s high level of energy self sufficiency in that period. Mr Nolan added, “The future remains bright for Esso’s Bass Strait operations, its dedicated workforce and the Victorian community with the multi-billion dollar Kipper and Turrum projects set to begin in 2011.” “The Kipper Project, near Ninety Mile Beach on the Gippsland coast, holds about 620 billion cubic feet of natural gas and 30 million barrels of condensate/LPG. The Turrum Project plans to develop another trillion cubic feet of gas and 110 million barrels of oil and gas liquids.” “Together, the two projects have enough energy to power an entire city of a million people for at least 35 years,” Mr Nolan said. “We also have ongoing exploration, drilling and evaluation programs, which are already proving to be successful in increasing production from existing fields.” “Even after 40 years of production, Bass Strait still has a long life, and we expect to be producing oil and gas for Australians for many more decades.” The Bass Strait oil and gas fields and associated production and processing facilities are owned by Esso Australia Resources and BHP Billiton in a 50:50 joint venture arrangement. Esso is the Operator.
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Above
For more information contact:
L - R: David Banks, BHP Billiton Petroleum Vice President, Geoff Morley, longest-serving Longford employee, The Hon Martin Ferguson, Commonwealth Minister for Resources and Energy, Mark Nolan, former ExxonMobil Australia Chairman, and The Hon Peter Batchelor, Victorian Minister for Energy and Resources.
Rebecca Arnold ExxonMobil Public Affairs Adviser Phone: 03 9270 3478 or 0400 511 247
DISCOVERY JOURNAL NOVEMBER 2009
Above: Drilling.
Above: Barracouta is towed out in the late 60s.
Above: Longford during construction.
Barry Beach Marine Terminal - jacket construction for offshore platform.
“Even after 40 years of production, Bass Strait still has a long life, and we expect to be producing oil and gas for Australians for many more decades.”
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Clean Coal Special
The combination of strategic planning around Victoria’s coal resource and significant investment in new technologies and uses will ensure Victoria’s coal resource can continue to be a significant contributor to the Victorian economy.
Clean Coa
Clean Coal Victoria Up and Running Former Latrobe Valley coal mine manager and local resident Charlie Speirs has been appointed Director of Clean Coal Victoria, the Energy and Resources Minister Peter Batchelor announced recently.
Mr Batchelor said, “Charlie Speirs is a great fit to head up Clean Coal Victoria, an organisation that will interact with local planning authorities, the local community and industry on the long-term use of coal.”
Above: Charlie Speirs at the 2009 Resources Victoria Conference.
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DISCOVERY JOURNAL NOVEMBER 2009
The $12.2 million Clean Coal Victoria initiative aims to unlock Victoria’s enormous coal resource in an environmentally sustainable way. Mr Batchelor said the Latrobe Valley coal resource and associated jobs and industry were unique in Australia and it was important that the Director had a thorough understanding of the coal resource and community expectations for its use and development. “Mr Speirs is an engineer who has worked for Loy Yang Power for over 29 years, and for the past decade has held the position of General Manager of Mining,” he said. “Mr Speirs was born and bred in the Latrobe Valley, so his extensive knowledge of the local community and the coal resource make him ideal for this position. He also has broad experience managing industry and government relations through his work with Loy Yang and as a member of the Minerals Council of Australia.”
Mr Speirs said Clean Coal Victoria would provide a dedicated organisation to plan for the long-term extraction, development, use and rehabilitation of the state’s vast and valuable coal resource. “I am delighted to accept this job and look forward to working with the community and industry to ensure Clean Coal Victoria plays a key role in positioning the Latrobe Valley for the future,” said Mr Spiers. Mr Batchelor said Victoria faced challenges such as reducing greenhouse gas emissions from current coal use and finding new uses for coal. “This is why we’ve taken the time to ensure the right person is appointed to this position and that the person is located in the Latrobe Valley at the heart of our coal resources,” he said. “One of his first tasks will be to facilitate the appointment of an advisory board for Clean Coal Victoria.” “In addition, Mr Speirs will develop a strategy for identifying areas with high
al Victoria Clean Coal Victoria open in the Latrobe Valley
value coal resources for the future and coordinate drilling, to assess the quality of coal resources in Gippsland. This research will assist in resolving land planning and development issues, and also help attract investment in Victoria’s coal resources by providing advanced information for industry on the resources available.” Mr Batchelor said the establishment of Clean Coal Victoria was progressing well. “The new Clean Coal Victoria offices in Traralgon were opened in August 2009. “Staff are being recruited to undertake the various roles required by Clean Coal Victoria,” he said. For More information contact
Charlie Speirs Director, Clean Coal Victoria Phone: 03 5160 9001 Fax: 03 5160 9055 Email:
[email protected]
Clean Coal Victoria (CCV) has opened new offices in Traralgon to provide a focal point for coal industry stakeholders in the Latrobe Valley. CCV has been operating since June with progress already made in a number of key areas in assessing the future use of Latrobe Valley Brown coal. Victorian Energy and Resources Minister Peter Batchelor, said the recent Latrobe Valley Energy Summit, organised by CCV was an important step in bringing together stakeholders to discuss the future use of coal. “The government is taking action to drive investment opportunities in the Latrobe Valley by providing $12.2 million over four years for the establishment and operation of CCV,” Mr Batchelor said. “CCV has been set-up by the Brumby Government to help unlock the value of Victoria’s coal resource in an environmentally sustainable manner, so what better place to base the headquarters than here in the heart of our coal resources?” Mr Batchelor said.
“The new offices will house up to seven CCV staff, creating new employment opportunities in Traralgon.” “Key projects of the CCV in progress include the appointment of an advisory board and the start of several drilling programs, in conjunction with local councils, to identify the quality and quantity of coal in a number of areas to help resolve land planning issues.” Mr Batchelor said CCV was a dedicated organisation that would plan for the long-term extraction, development, use and rehabilitation of the state’s vast and valuable coal resources while considering the interests of the communities in which existing and future coal industries operate. For More information contact
Charlie Speirs Director, Clean Coal Victoria Tel (03) 5160 9001 Fax (03) 5160 9055 Email:
[email protected]
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Clean Coal Special
Clean Coa Image: Representation of the carbon cycle. More details and images are available at www.co2crc.com.au.
CCS research funded for further five years
The future of the Cooperative Research Centre for Greenhouse Gas Technologies (CO2CRC), one of the world’s leading Carbon Capture and Storage (CCS) research collaborations, is assured for another five years after winning new funding from the Australian Government earlier this year.
The CO2CRC is one of ten successful CRCs funded in the 11th selection round of the Australian Government’s Cooperative Research Centres (CRC) Program. New funding totalling $A20 million will enable the CO2CRC to continue its research until 2015. Dr Peter Cook, Chief Executive of CO2CRC, said, “We are very pleased that the Australian Government has decided to fund CO2CRC for a further five years. The decision allows us to maintain the highly successful multi-disciplinary research teams we have assembled to accelerate deployment of CCS technology and further strengthen our international CCS connections.” “Extending CO2CRC until 2015 will allow us to further capitalise on the three demonstration projects we now have in operation: the CO2CRC Otway Project, the HRL/CO2CRC Mulgrave Capture Project and the CO2CRC H3 Capture Project,” he said.
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DISCOVERY JOURNAL NOVEMBER 2009
“These demonstration projects are already producing important outcomes in storage and capture research, including showing that storage of carbon dioxide (CO2) can be safe and effective and that capture costs can be reduced.” CCS has the potential to make deep cuts in global CO2 emissions, a major contributor to climate change, by capturing and permanently storing CO2 from major sources such as power stations. The CO2CRC Otway Project is Australia’s first demonstration of the deep geological storage or geosequestration of CO2, the most common greenhouse gas. The project is one of the world’s largest research and geosequestration demonstration projects with about 65,000 tonnes of CO2 already stored deep underground. The program also includes an outstanding monitoring program, which international and national scientists believe to be the most comprehensive of its type in the world. In addition to the Otway Project, the CO2CRC has commissioned another significant research project. Australia’s most comprehensive ‘post-combustion’ CO2 capture research facility, the CO2CRC H3 Capture Project, has been commissioned at International Power’s Hazelwood power station in the Latrobe Valley. The project was launched by Victorian Energy and Resources Minister Peter
Batchelor. Barry Hooper, Chief Technologist of the CO2CRC said, “The CO2CRC H3 Capture Project will trial three CO2 capture technologies with Australian brown coal flue gases and evaluate them for larger scale capture.” “Projects such as this will make retro-fitting of post-combustion capture technology more practical and affordable for all power stations.” The project is using the 30 metre high solvent capture plant installed by International Power as part of the Hazelwood Carbon Capture Project to test and evaluate new and improved solvents, compare equipment performance, investigate impurities removal and optimise solvent capture processes. The project is using purpose-built research modules to evaluate two new technologies for CO2 capture: membranes and adsorbents. New types of membranes can be used to sieve out CO2 molecules from gas streams and can be integrated with solvent systems. Adsorbents are solids that can capture CO2 on their surface, release it by reducing the pressure and be reused over and over. The project will allow CO2CRC to leverage the existing research base of its capture activities in Victoria. The University of Melbourne is developing solvent and membrane technologies, while
al Victoria CO2 capture technology developed in the lab
Monash University performs research and development on adsorbents. The project is part of the Latrobe Valley Post-Combustion Capture Project and is supported by the Victorian Government, through their Energy Technology Innovation Strategy (ETIS) Brown Coal Research and Demonstration funding, and by the Federal Government, through the CRC Program..
Further information:
Barry Hooper, Phone: +61 3 8344 6622, 0408 815 608 Email:
[email protected] Media assistance: Tony Steeper, Phone: +61 2 6120 1611, 0417 697 470 Email:
[email protected] More details and images are available at www.co2crc.com.au CO2CRC collaborates with leading international and national CCS experts to conduct world-class research into CCS. Organisations participating in CO2CRC research include CSIRO, Geoscience Australia, the Universities of Adelaide, Curtin, Melbourne, Monash and NSW, the Alberta Research Council of Canada and the US Lawrence Berkeley National Laboratory. Industry and State core partners supporting CO2CRC are ACARP, Anglo American, BHP Billiton, BP Australia, Chevron, ConocoPhillips, Inpex, KIGAM, Mitsui, the NSW Department of Primary Industries, NZ Resource Consortium, Origin, QER, Rio Tinto, Sasol, Schlumberger, Shell, Foundation for Research Science and Technology (NZ), Solid Energy, Stanwell, the Victorian Department of Primary Industries, the QLD Department of Mines and Energy, the WA Department of Mines and Petroleum, Woodside and Xstrata. CO2CRC is supported through the Australian Government’s CRC Program.
Carbon dioxide (CO2) is now being captured by researchers in Australia’s first pre-combustion carbon capture project.
The Cooperative Research Centre for Greenhouse Gas Technologies (CO2CRC) has commissioned three CO2 capture research rigs with the aim of reducing CO2 emissions from the next generation of highefficiency coal gasification power stations. The project being developed at HRL’s gasifier research facility at Mulgrave was launched by Victorian Minister for Energy and Resources, Peter Batchelor, in July. Mr Barry Hooper, Chief Technologist of the CO2CRC said, “The CO2CRC rigs will capture CO2 from syngas, the product of the brown coal gasifier, using three innovative new technologies. These capture technologies are equally applicable to syngas from brown and black coal, gas or biomass fuels.” “Advanced gasifier technologies are highly suitable for CCS capture as they produce a concentrated stream of CO2. During the research project, researchers will evaluate solvent, membrane and adsorbent technologies for efficiency and costeffectiveness.”
“Our key objective is to reduce the technical risk and cost of capturing CO2 from the next generation of coal gasification power stations,” said Mr Hooper. “Projects such as this can also demonstrate that CCS is not only possible but practical. “It’s an exciting step up from lab research and will allow CO2CRC researchers from the University of Melbourne and Monash University to undertake applied research in an industrial environment.” Further information:
Barry Hooper, Phone: +61 3 8344 6622, 0408 815 608 Email:
[email protected] Media assistance: Tony Steeper, Phone: +61 2 6120 1611, 0417 697 470 Email:
[email protected]
For an overview, technology fact sheets and images of the project, see www.co2crc.com.au
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Clean Coal Special
Clean Coa
Power plant technology cuts CO2 emissions
New efforts to reduce Victoria’s greenhouse gas emissions are being introduced at International Power’s Hazelwood power plant in the Latrobe Valley, where one of Australia’s largest trial CO2 capture facilities to be installed at a coal-fired power station is located.
Launching the new facility in July, Energy and Resources Minister Peter Batchelor congratulated the company and its project partners – the CO2CRC and Process Group – adding that this facility has been supported by both the Victorian and Commonwealth Governments. “This cutting-edge facility is another step in the development of carbon capture and storage (CCS) technology in Australia. It has the capacity to capture up to 25 tonnes of CO2 a day (or ~ 10,000 tonnes per year), 10 times more than similar facilities in Australia can currently capture.” The Hazelwood facility uses solvent technology to capture carbon from gases emitted from the exhaust stacks at the Hazelwood power plant.
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DISCOVERY JOURNAL NOVEMBER 2009
The captured CO2 is used to chemically treat ash water – a waste by-product of coalfired electricity generation. This produces a calcium carbonate solid. The Minister also launched the latest carbon capture facility of the Latrobe Valley Post Combustion Capture Project that the Victorian Government provided $2.5 million through its Energy Technology Innovation Strategy (ETIS) Brown Coal R&D grants. “There are now seven carbon capture plants in Victoria being used to identify the most effective and efficient technology for the future,” Mr Batchelor said. “Apart from the storage of CO2 as calcium carbonate, geosequestration trials are also underway in the Otway Basin, looking at the potential storage of CO2 underground.” Mr Batchelor said Victoria led the nation in the development of these vital new technologies making the state an ideal place to locate one of the Commonwealth Government’s CCS Flagship projects. “CCS offers the potential to move coal, our largest source of electricity, to a cleaner future – helping secure the Latrobe Valley’s energy future and providing sustainable development through new investment and jobs,” he said.
“This pilot-scale demonstration of carbon capture technology on a commercial plant has excited national and international interest. It illustrates to the brown and black coal power industry the potential to retrofit this technology and the opportunities for CO2 sequestration.” “The Brumby Government is currently offering ETIS grants worth up to $110 million for large-scale carbon capture and storage projects in Victoria. Another $5.2 million is being provided to undertake 3D modelling to help identify areas in Victoria which may be suitable for carbon storage.”
For more information contact:
Dr Leigh Clemow Manager Brown Coal Technologies Energy Technology Innovation Department of Primary Industries Phone: 03 9658 4485
al Victoria Above: International Power Australia’s Executive Director Tony Concannon (middle) shows the calcium carbonate by-product of IPRA’s $10 million carbon capture facility at Hazelwood power station to state Energy Minister Peter Batchelor (second from right). Hazelwood Chief Executive, Graeme York, is pictured at left and with Process Group Managing Director Craig Dugan (far right).
Above: Exit from the Stage One Reactor which is a cake that consists of cellulose and lignin.
Ignite Energy Coal to Liquids Project Ignite Energy Resources (IER) and TRUenergy plan to build a commercial demonstration plant to convert Latrobe Valley brown coal into liquid oil and dried brown coal.
The two companies have signed a Memorandum of Understanding (MoU) to develop a demonstration plant at TRUenergy’s Yallourn mine to test the commercial application of the technology. IER’s proprietary supercritical water technology has the potential to transform low ranked coals, including lignite like that found in abundance in the Latrobe Valley, directly into high-value oils and cleaner coal products. IER already operates a small scale reactor at Somersby in NSW which can convert one dry tonne of Gippsland Basin lignite into approximately two barrels of oil and 0.6 tonnes of high ranked coal. Independent expert reports predict that the company’s coal, compared to lignite, will reduce CO2 emissions by 40% when used for power generation. The eventual Latrobe Valley plant will be developed in three stages to process up to 60,000 tonnes of high moisture content brown coal per annum to produce up to 60,000 barrels of IER high grade oils and 18,000 tonnes of high-grade dry coal.
Subject to feasibility studies and based on the operating Somersby reactor design, IER will build and operate a commercial-scale reactor at the TRUenergy site. The initial plant is expected to be operating by the second quarter of 2010. Dr Len Humphreys, CEO of IER said, “We are delighted that TRUenergy, which is committed to addressing climate change, is supporting the development of this plant. In a CO2 conscious world, we believe IER’s technology can fundamentally change the way the world looks at lignite.” Richard McIndoe, MD of TRUenergy said, “TRUenergy’s involvement in this demonstration plant and support for Iignite’s innovative approach is consistent with our strategy to support new technology initiatives that can help ensure a future for Victoria’s brown coal. This is a resource that has a huge potential if solutions to its high carbon intensity can be developed and commercialised. We believe this is an important initiative.” IER is based in Sydney and has patents pending over the supercritical water reactor which is central to the conversion process. Apart from IER’s plant in Somersby, it has certain rights to significant, proven reserves of lignite through a Gippsland Basin Exploration Licence.
Ignite Energy Resources, with its affiliate Licella, has developed a Super Critical Water (SCW) reactor technology for converting modern Biomass (plant matter) and ancient Biomass (coal) into highly valuable oil and coal products. Independent expert reports have predicted that IER’s process can be economic at oil prices as low as $30 per barrel. IER owns rights to Exploration License (EL) 4416 in the Gippsland basin, which it estimates to contain at least 18 billion tonnes of lignite. IER stated that using the conversion rate of the existing IER reactor in Sydney, this 18 billion tonnes could potentially be converted into approximately 18 billion barrels of oil and 5 billion tonnes of cleaner coal products. While lignite is widely available, it is highly polluting when used in conventional applications. Converting lignite into IER’s coal products can reduce CO2 emissions by up to 40%. For further information visit:
www.igniteer.com Or call
Ian Westbrook, Westbrook Communications: Phone: 02 9231 0922 Carl Kitchen, TRUenergy Phone: 03 8628 1079
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Clean Coal Special
Clean Coa
Gippsland Regional Infrastructure Development Studies
Studies into developing a comprehensive transport plan for future brown coal projects in the Latrobe Valley started in 2009 after the Victorian Government launched its Gippsland Regional Infrastructure Development Studies project recently. The project will assess the transport implications from new brown coal industries in Gippsland which are likely to come on stream from about 2015. The project provides for a phased approach including scoping, options analysis and pre-feasibility studies on transport infrastructure requirements to support development of these new industries and get value-added coal products to world markets. The studies will provide forward planning to allow for growth of new industries which will boost the Victorian economy and the identification of new transport infrastructure needs in regional Victoria. For more information contact:
Sean Rooney Acting Director, Business Development and Facilitation, Earth Resources Division Phone: (03) 9658 4739
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DISCOVERY JOURNAL NOVEMBER 2009
Latrobe Valley looks to reduce carbon footprint
Held in July, a Latrobe Valley energy summit recently explored ways to drive jobs growth and investment in the Latrobe Valley, seeking to secure in a future in which the intense carbon emissions of the past must be curbed. The summit brought together government, industry, unions and worker representatives in Traralgon along with Victorian Energy and Resources Minister Peter Batchelor. Mr Batchelor said that the summit provided an opportunity to discuss the development and use of Victoria’s brown coal in a cleaner and more sustainable way. “As we transition to a carbon-constrained future we believe it’s important that electricity workers have the chance to help shape the Latrobe Valley’s future direction,” Mr Batchelor said. “Addressing climate change will result in huge changes for the power industry in the Latrobe Valley and it is vital that government, industry and communities work together to ensure a smooth transition to low emissions energy.”
More than 90 per cent of Victoria’s energy is generated from the Latrobe Valley’s brown coal, which emits very high levels of carbon. “While new energy sources such as solar and wind power are an important part of our energy mix, coal will continue to be a source of power for Victorians in the foreseeable future,” Mr Batchelor said. “However, the high emissions from brown coal-fired electricity generation means that we must make coal cleaner.” “As these new technologies come on stream they will change how the energy sector operates and require new skills for workers,” he said.
For More information contact
Charlie Speirs Director, Clean Coal Victoria Phone: 03 5160 9001 Fax: 03 5160 9055 Email:
[email protected]
al Victoria Young researchers gather in Lorne
Postgraduate students from across the world gathered recently in Lorne for five days of intensive study of carbon capture and storage (CCS) science and technology developments.
The students, who are studying engineering, chemistry, geology and economics, heard from a range of international CCS experts. They came together through the CCS Summer School Greenhouse Gas Research and Development Program, originally created by the International Energy Agency. It is the first time the program has been held in Australia. The summer school has previously been held in Germany and Canada. Lorne is close to the CO2 Cooperative Research Centre’s Otway Project at Nirranda. The Otway Project, supported with $6 million from the Victorian Government, is the first carbon storage project trial in Australia.
The project involves the injection of large quantities of CO2 into a depleted gas field two kilometres below ground level, with the trial already reaching a 60,000 tonne milestone. Victorian Energy and Resources Minister, Peter Batchelor, said the initial success of the project had prompted plans for an expansion of the trial, with the potential for additional CO2 to be injected via a second well. “The Otway basin and the Gippsland basin show strong potential as geological carbon storage areas. The Gippsland basin is particularly significant because of its close proximity to coal-fired power stations in the Latrobe Valley,” he said. The Victorian Government had also invested in other CCS research including: • $110 million through the Energy Technology Innovation Strategy (ETIS) for large-scale carbon capture and storage demonstrations; • $2.5 million from the ETIS brown coal R&D program for the Latrobe Valley Post Combustion Capture Project, which last year was the first project to capture CO2 from coal fired electricity generation in Australia;
Above: International postgraduate students gather in Lorne.
• $2.06 million from the ETIS brown coal R&D program to the CO2CRC for the Pre Combustion Capture Project; and • $5.2 million to undertake 3D modelling to help identify areas, such as the Gippsland Basin, which may be suitable for carbon storage - preliminary results have already identified offshore areas with excellent potential. For more information contact:
Namiko Ranasinghe Petroleum Development Adviser Department of Primary Industries Phone: 03 9658 4947 Email:
[email protected]
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Right: Drilling is underway to extend reserves in the Phoenix ore body at Northgate’s Fosterville Mine.
Northgate Minerals Corporation
Northgate – Victoria’s biggest gold miner Canadian based Northgate Minerals, Victoria’s biggest gold producer, has enjoyed a strong June quarter, generating excellent cash flow from operations and increasing gold reserves at the Stawell gold mine, the company reported recently to the Toronto Stock Exchange. In the June quarter the Fosterville mine produced 25,416 ounces of gold, a significant improvement from the 14,630 ounces of gold produced in the corresponding quarter of 2008. During the second quarter, 206,829 tonnes of ore were mined. Mining rates dramatically increased in the second quarter of 2009 compared to the same period last year due to an increase in the number of working faces made available by the substantial mine development achieved since taking ownership of the mine. During the quarter, a record 203,822 tonnes of ore were milled at a grade of 4.54 grams of gold per tonne (g/t). Although tonnes milled were significantly higher than they were in the same period of 2008, ore grade was lower than the 5.40 g/t for the 2008 June quarter. Mill head grades are Gold recoveries of 86% in the expected to improve second quarter of 2009 were as higher grade stopes are mined, and gold dramatically higher than the production is now 76% recovery recorded in the anticipated to be 31,000 same period last year. The fully ounces for the third commissioned heated leach circuit quarter of 2009. is expected to further improve gold Gold recoveries of recoveries in future quarters. 86% in the second quarter of 2009 were dramatically higher than the 76% recovery recorded in the same period last year. The fully commissioned heated leach circuit is expected to further improve gold recoveries in future quarters. Fosterville’s revenue for the three months ended June 30 2009 was $22.57 million, based on gold sales of 24,875 ounces. During the second quarter, drilling programs accelerated at Fosterville with up to four surface diamond drill rigs operating in the southern part of the mine lease where 17 holes and over 9,000m of diamond drilling were completed. At Harrier Underground, located 1.7 kilometres south of the current Phoenix mining area, ten holes drill tested parts of the Osprey and Harrier base zones. The current drill programs have two goals: first,
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DISCOVERY JOURNAL NOVEMBER 2009
to reduce drill section spacing from 100m to 50m for areas with strong gold mineralization to permit detailed resource modelling, and second, to increase the size of the existing resource by drill testing potential down plunge mineralization extensions. Drilling is also underway at Phoenix Deeps, approximately 300m to the south of and down plunge from the last Phoenix drill intercept. Three of the five holes attained target depths and all holes intersected gold mineralisation. At the Stawell mine a total of 20,066 ounces of gold was produced during the three months ended June 30 2009, compared to 22,807 ounces of gold in the corresponding period last year. Gold production was lower than forecast due to changes in the stoping sequence caused by geotechnical issues that developed within Golden Gift 5 level mining block. Stawell’s annual production for 2009 is now forecast at approximately 96,500 ounces. Stawell’s revenue for the three months ended June 30 2009 was $18.06 million based on gold sales of 19,608 ounces. Since the acquisition of the Stawell mine, Northgate’s exploration program has successfully delineated new zones of economic mineralisation. In the first six months of 2009, mineral reserves and resources were increased in all areas of the mine through a combination of exploration drilling, resource definition drilling, and grade control drilling the company revealed in its quarterly report. A total of 870,000 tonnes containing 93,000 ounces of additional gold reserves were delineated extending the Stawell mine life to the second quarter of 2012. A further 32,000 ounces of indicated and 98,000 ounces of inferred resources have also been added. For more information contact
Luc Guimond Northgate Minerals Corp Phone: +61 03 5442 7755 Fax: +61 03 5442 3955
The Kangaroo Flat mine is located in the Bendigo goldfield, Australia’s second largest goldfield, having produced some 22 million ounces of gold, to an average depth of 750 metres. Production of around 30-40,000 oz gold is planned for Kangaroo Flat during the 2009 calendar year.
Bendigo Mining
Bendigo gold pours forth in June quarter
Exploration is continuing beneath and along from historic mines on the richest lines of mineralisation within the Bendigo Goldfield. In the June quarter a total of 6721 diamond drill metres were completed, testing the Deborah, Garden Gully and Hustlers lines from underground locations within the Kangaroo Flat mine. The exploration strategy is to locate additional mineable reefs within 1000 metres of existing mine development. This strategy is being implemented by testing targets both vertically below and along from historic workings.
Gold production at the Kangaroo Flat mine in Bendigo mine jumped by 33% in the June quarter to 13,122 ounces and the company’s financial position strengthened sharply, Bendigo Mining reported to the Australian Stock Exchange. Managing Director of Bendigo Mining Rod Hanson said, “Record quarterly production was achieved from strong performance at our Kangaroo Flat mine. The careful and flexible operating strategy we have pursued is proving to be very successful at Bendigo. The strong gold price and higher level of gold production generated net cash flow in the quarter of $7 million and increased our cash in bank to $57 million.” “Production from October 2008 has generated positive cashflow of just over $14 million, with the majority in the past six months. This is a strong result considering that reported cashflow is net of all capital, exploration and head office expenses,” he said. Ore produced at the mine in the June quarter had an average grade of 9.1 g/t. A total of 48,507 tonnes of ore was treated at a cash operating cost of A$639/oz. The majority of the ore was sourced from Gill Reef, with the remainder from Dale, Garrard and Dean reefs, as well as low grade stocks. Gold grades across individual mining blocks varied during the quarter from 5.5 g/t to 13.6 g/t gold, averaging 9.1 g/t gold. Bendigo Mining is planning to produce 50-65,000 oz of gold in the 2009 calendar year from the Kangaroo Flat mine and its newly acquired Henty mine in Tasmania. Above: Kangaroo Flat mine site.
Exploration is also focused on upgrading the potential of recently discovered reefs through programs of infill drilling. Exploration of the Deborah line continued to test the relatively shallow Dunlop reef south of historic workings. The reef is located adjacent to the anticline axis and is some 150 metres east of the modern mine workings. Drilling completed this quarter increased the defined length of the Dunlop reef by 110 metres to 290 metres. The reef size diminishes southwards, becoming a zone of weak quartz veining 15 metres high and 10 metres wide. Resource estimation and mine planning studies have commenced. For more information contact:
Tim Churcher Chief Financial Officer Bendigo Mining Limited Phone: +61 (0)3 5447 1834 Fax: +61 (0)3 5447 1835 Email: info@ bendigomining.com.au Website: www.bendigomining.com.au
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This page: RC drilling at the Junction 1 Prospect, Stavely. Left: Mt Ararat copper deposit lies at the base of the hill, and above the treeline.
Beaconsfield Gold NL
Beaconsfield Gold ramps up exploration near the Grampians Melbourne based gold miner and base metals explorer, Beaconsfield Gold NL, believes its copper project in western Victoria has solid potential for development with the promise of becoming one of Victoria’s most significant base metal mines.
The company has made substantial progress towards its initial aim of outlining resources of at least 100,000 tonnes of contained copper and has been examining future development concepts. Drilling by Beaconsfield Gold has defined a JORC Inferred Resource of 47,000 tonnes of contained copper (10.6 million tonnes at 0.45% copper) at its wholly owned Thursdays Gossan oxide deposit. The company is also earning a 75% interest in a JORC Inferred Resource of 19,000 tonnes of contained copper (0.7 million tonnes at 2.7% copper) at the nearby Mt Ararat copper-gold deposit. Beaconsfield Gold has A conceptual development consolidated its tenements in the area, now owning study, based on a nominal 1.5 million tonnes per year flotation more than 1,300 square kilometres, over which sound plant, has been completed, with exploration data exists. encouraging results. A conceptual development study, based on a nominal 1.5 million tonnes per year flotation plant, has been completed, with encouraging results. This study investigated resource, mining, metallurgical processing, environmental, infrastructure, permitting and cost aspects and identified areas which require further work to take the project to a feasibility study. The study outlined the key parameters of the project: • Target production of 10,000 tonnes per year of contained copper for at least seven years; • Clean concentrate with gold, silver and lead credits based on flotation tests; 20
DISCOVERY JOURNAL NOVEMBER 2009
• Resources amenable to initial open cut operations, with free digging mineralisation and low strip ratio evident at Thursdays Gossan; • A central processing plant at Thursdays Gossan for multiple deposits; • Close proximity to existing infrastructure and a local workforce; and • Concentrate transport opportunity on the Ararat-Portland railway line for export from Portland 150 kilometres to the south west. Beaconsfield Gold plans to fund its exploration effort with cash generated from its high grade Tasmania mine on the banks of Tasmania’s Tamar River and from the Victorian Government’s Rediscover Victoria exploration drilling assistance program. In the June quarter Beaconsfield Gold increased its exposure to the potentially rich western Victoria zone which is the focus of the company’s exploration effort. Beaconsfield acquired the right to earn a controlling interest in an Indicated and Inferred Resource of 700,000 tonnes at an average grade of 2.7% copper at Ararat, close to the company’s existing Stavely copper resource. The company told the Australian Stock Exchange that drilling is planned to follow up on the best intercept of 4.4 metres at 12% copper and 8.1 g/t gold. The company also acquired 100% ownership of the Stavely project in July with the exercise of the purchase option for $250,000. Beaconsfield Gold CEO Bill Colvin said, “The acquisition of the right to earn a 75% interest in the Ararat project has significantly enhanced the potential for development of a significant copper/gold mine in western Victoria, in combination with our existing 100% owned resources and prospects at Stavely.”
“Beaconsfield Gold has now successfully moved to become a mid-tier gold producer with no bank debt, no gold hedging commitments and significant exploration potential both in northeastern Tasmania and in western Victoria,” Mr Colvin said. The Stavely project is contained within Exploration Licence EL4556, which holds all of the known copper and gold mineralisation in that project area. In the June quarter, Beaconsfield Gold announced a farmin agreement with Range River Gold Ltd for the Ararat project, comprising three exploration licences located 40km to the north east of the Stavely project. The company can earn 75% equity in the project by spending $1.0 million within 4 years. According to Mr Colvin the Ararat project contains significant copper and gold potential, with a high grade copper deposit at Mt Ararat delineated in the 1970’s. An Area Work Plan for drilling and trenching on the Stavely and Ararat projects has been approved by the Victorian Department of Primary Industries. This work commenced in October 2009. In the area where Beaconsfield has outlined significant copper potential the company plans to start infill drilling at the Thursdays Gossan oxide discovery to develop the project to Indicated Resource status for the current 10.5 million tonne Inferred resource. Extensional deep drilling at Thursday’s Gossan will further define primary high grade copper sulphide mineralisation, where sparse drilling to date has produced a best intercept of 7.7 metres at 4.2% copper.
Above: Stavely/Ararat Projects, Western Victoria.
Other planned work includes: • Extensional drilling at the Junction high grade copper deposit, which was discovered in December 2008 with a best reported intercept of 35 metres at 3.7% copper; • Three regional diamond drillholes testing new copper sulphide targets, subsidised by a Victorian government RVD grant of $60,000; • Infill and extensional drilling at the Mt Ararat copper-gold deposit, which has potential to provide supplementary high grade feed to a Stavely processing plant; • Follow up drilling of the single diamond hole at Langi Logan prospect at Ararat which intersected 2 metres at 9.2 g/t gold in a Stawell-style setting; • Detailed gravity survey to identify further Stawell-style basalt domes under shallow cover south of the Langi Logan prospect at Ararat; and • Surface trenching and drilling of parts of the Fairview gold anomaly at Stavely. A recent gravity survey over this extensive gold-in-soil anomaly has highlighted the potential for gold to be focused around porphyry intrusions. For more information contact:
Bill Colvin Chief Executive Officer Beaconsfield Gold NL Phone: 61-3-9909-7401 Email:
[email protected] Website: www.beaconsfieldgold.com.au
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Below: Areas being investigated for carbon storage potential.
GeoScience Victoria
Geological ‘Skeleton’ of Gippsland Basin to be revealed Efforts by Geoscience Victoria to create a 3D map of the Gippsland Basin, the source of the rich oil and gas fields in Bass Strait, have been extended to the commercial sector. A tender seeking companies to interpret existing seismic data – acquired by reflecting sound waves off underground structures – has been let to create a geological framework showing the geology within in the basin. GeoScience Victoria geologists will then use this ‘skeleton’ to build a comprehensive 3D model of the region – a powerful and cutting-edge tool that allows geologists and exploration managers to visualise different layers of rock and faults. This will assist exploration companies to better focus their efforts on discovering new commercial resources which can improve Australia’s energy self-sufficiency. Energy and Resources Minister Peter Batchelor said, “Just as doctors use ultrasound to look at the internal structures of the human body, seismic reflection data will need to be used to map these subsurface structures.”
“The Gippsland Basin 3D model is a key part of the Government’s $5.2 million Victorian Geological Carbon Storage (VicGCS) initiative to provide a regional assessment of greenhouse gas storage potential within the Gippsland Basin,” Mr Batchelor said that this 3D model could be used to more accurately predict the location of underground carbon dioxide storage, undiscovered petroleum systems and geothermal energy, helping to reduce exploration time, costs and risk.
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“We are committed to continuing to support the Victorian earth resources industry by generating and providing geological knowledge to explorers.” “VicGCS has already identified areas in the Gippsland Basin with excellent potential for greenhouse gas storage. The 3D model will increase our understanding of how CO2 behaves following injection deep underground.” The region to be mapped includes most of the offshore and a small part of the onshore Gippsland Basin and covers approximately 4000 square kilometres. From Lakes Entrance, the region extends about 80km west to Yarram, 120km east and 200km south into Bass Strait. “The Gippsland Basin 3D model will also add another piece to the whole-of-Victoria 3D geological model being created under the Brumby Government’s $2.5 million Rediscover Victoria 3D initiative,” Mr Batchelor said. Contact for investor information:
Kathy Hill Director Geoscience Victoria Phone: 03 9658 4562 Email:
[email protected]
The new acreage, administered by Victoria but lying within Commonwealth Government controlled waters, is regarded as highly promising and likely to contain as yet undiscovered petroleum reserves.
New areas released for offshore oil and gas exploration Four new offshore areas along Victoria’s south-west coast in the Otway Basin south of Warrnambool and Portland, adjacent to Victoria’s highest yielding gas fields, have been released, for oil and gas exploration. The region supplies a large part of Australia’s east coast domestic and industrial gas market including Victoria, South Australia and New South Wales, but the offshore areas are currently under-explored. The new acreage, administered by Victoria but lying within Commonwealth Government controlled waters, is regarded as highly promising and likely to contain as yet undiscovered petroleum reserves.
Victorian Energy and Resources Minister Peter Batchelor and Federal Minister for Energy, Resources and Tourism Martin Ferguson jointly announced the acreage release. “By jointly releasing this promising acreage, the Victorian Government is taking action to provide opportunities for new oil and gas exploration which could lead to new discoveries and secure our energy supplies,” said Mr Batchelor. “This release is another addition to the growing energy sector in Victoria’s south-west, with the region boasting geothermal exploration, wind energy and carbon capture and storage research.” Mr Batchelor said that under the release, companies would be able to tender for the four areas to carry out exploration activities. “The Otway Basin has seen several natural gas discoveries by companies such as Woodside and Santos in the past decade, with some of the fields already well into production,” he said. The closing date for applications for areas V09-1, V09-2 and V09-3 is December 3, 2009. The closing date for applications for area V09-4 is April 29, 2010. Contact for investor information:
Dr Geoffrey O’Brien Department of Primary Industries Phone: 03 96584537 Email: geoff.o’
[email protected]
Below: Map showing the 2009 acreage release blocks in yellow, and current blocks in pink.
23
2009 SUMMARY
Minister says Victoria “open for business” Victorian Resources Minister Peter Batchelor has declared Victoria “open for business”.
“Despite the changes in the economic landscape, we have still seen many positive stories in Victoria in the last 12 months.”
Opening the second annual Paydirt Resources Victoria Conference Mr Batchelor said, “After a significant period of growth in the resources sector both here in Victoria and around the world, the Global Financial Crisis hit. However, Victoria is still open for business and offers many investment opportunities in the resources sector.
These stories include: • Work starting on Iluka Resources’ $209 million mineral sands Murray Basin Stage 2 Project; • Discoveries of new base metals in Western and North Eastern Victoria; and • The 40th anniversary of oil and gas production from Bass Strait by Esso Australia and BHP Billiton.
Mr Batchelor said that demand for coal, oil, gas and gold has remained strong in the last 12 months. “Our massive coal resource continues to be in high demand, both for traditional uses such as electricity, but also for emerging uses such as conversion to fertilizer and liquid fuels.” “The combination of strategic planning around our coal resource and significant investment in new technologies and uses for our coal will ensure our coal resource can continue to be a significant contributor to our economy.”
Resources Victoria Conference success The Paydirt Resources Victoria Conference and subsequent technical forum organised by GeoScience Victoria (GSV) has been hailed as success by Energy and Earth Resources Deputy Secretary Richard Aldous.
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DISCOVERY JOURNAL NOVEMBER 2009
The conference, which attracted 160 delegates on the first two days, provided a detailed update on the state of minerals and energy exploration and production in the state, and was the latest effort by Victoria’s Department of Primary Industry to attract exploration and development spending in Victoria. The technical forum held on the third day of the conference attracted more than 300 delegates. Given that the Victorian Government estimates that there is 1,000 or more tonnes
of gold waiting to be discovered from north of Bendigo through to the Murray River, there is certainly a strong case for having a look in the state. The state is endowed with commodities such as mineral sands, gold, petroleum and brown coal as well as emerging industries such as geosequestration and geothermal. Victoria is also firming as an increasingly attractive destination for base metals explorers. In an effort to turn all of these opportunities into commercial operations mines, the
The Minister added that the outlook for Victoria’s oil and gas sector was also bright. “A significant milestone was reached in April with the 40th anniversary of natural gas supply to Victorian consumers and oil and gas production from Bass Strait. Bass Strait oil and gas has produced almost two-thirds of Australia’s cumulative oil production to date and 30 per cent of Australia’s gas production. With substantial capacity still available it will continue to supply gas for many years to come. “Industry’s confidence in this resource is still strong and is highlighted by the almost $3 billion worth of new projects in Bass Strait announced in the last two years.”
On the gold front Mr Batchelor said, “Bendigo and Northgate have both had some great results this year. The Gold Undercover study – which looked at possible gold deposits under sediment in northern Victoria – is one of our success stories and I’m sure will be a valuable tool for gold explorers in coming years.” “To support the geotechnical data we are providing for industry we have also been running the Rediscover Victoria Drilling grants program, which supplies grants to support exploration for minerals in greenfield areas. We have already had some extremely promising results; for example Beaconsfield Gold’s copper discovery in western Victoria.”
The Minister concluded by saying, “The second round of grants, totalling $700,000, were awarded to 11 companies in Minister Peter Batchelor opens Resources November last Victoria Conference 2009. year. The third round of the grants program will be launched shortly, and I’m pleased to announce today that for the first time we will not only offer grants for mineral exploration, but also for geothermal exploration.”
Victoria Drilling (RVD), which offers grants to Victorian tenement holders to “encourage drilling programmes in areas previously seen as either higher risk or having limited prospectivity”. Grants have been awarded to a variety of companies with a number of potentially significant new discoveries already coming to light. With accelerated drilling, more discoveries will be unearthed in the state, ensuring a bright future for the resources sector.
For more information contact:
Above: Ingrid Campbell from Lakes Oil.
Department has gone on the front foot to attract new investment. The Resources Victoria Conference, organised by Paydirt Media, provided a platform to highlight the work being undertaken by both government and industry. One incentive-driven campaign that has proved popular in securing new investment in Victoria is the Rediscover Victoria initiative. The Victorian Government has committed $5 million over four years, until 2012, to support exploration in the state. Half of this figure has been dedicated to Rediscover
Kalé Nakazwe Conference Manager Paydirt Media Pty Ltd Phone: 08 9321 0355 Email:
[email protected] www.resourcesvictoriaconference.com For more information relating to the technical forum contact:
Paul McDonald Manager Resources GeoScience Victoria Email:
[email protected]
25
2009 Resources Victoria Conference
Victorian oil and gas exploration set to grow A return to higher levels of exploration in the Victorian offshore Otway and Bass basins should be expected as the global financial crisis eases and capital begins flowing again, according to the Australian Petroleum Production and Exploration Association (APPEA). But the peak industry body has also warned that the nation faces a crude oil and condensate deficit worth $28 billion in under 10 years unless major new domestic discoveries, such as those from the Otway and Bass Basins, are forthcoming. Addressing the first day of the Paydirt 2009 Resources Victoria Conference, APPEA’s Deputy Above: Mark McCallum Chief Executive – Policy and External Relations Mark McCallum said that while considerable attention had been recently focused on the potential of the massive gas resources being found in the Browse basin offshore Western Australia and the coal seam projects of central Queensland, Victoria “has certainly not run its race.” “While exploration offshore Victoria has slowed considerably with the onset of the global financial crisis, the improvement in equities and energy markets will see an uplift in exploration activities, particularly in the Otway and Bass Basins and the deeper water areas of the Gippsland Basin,” he said.
Morning Star mine to resume gold production “The area is still attracting investment, with eight new projects valued at A$3.3 billion recently announced or under active consideration.” On the national scale, Mr McCallum warned that Australia’s oil and condensate production had declined every year since 2000, from 715,000 barrels per day to 461,000 barrels per day last year – a decline of 35%. “By 2017, without major new discoveries, consumption will be offset by 32% production,
“Large volumes of gas, already discovered and awaiting sale, exist in the Gippsland basin with strong potential for new discoveries off the state’s west coast.” resulting in a crude oil and condensate trade deficit of A$28 billion or higher.” Mr McCallum said that in the case of oil, Australia had less than 10 years of reserves at current production levels. He went on to add that the story for Australia’s natural gas outlook was much different and brighter. “Right now, natural gas presents a compelling opportunity to address climate change, provide energy security to Australian and key Asian economies and in doing so, strong economic growth for Australia.” “Large volumes of gas, already discovered and awaiting sale, exist in the Gippsland basin with strong potential for new discoveries off the state’s west coast.” For more information contact
Mark McCallum APPEA Phone: 0414 955 414
Gold is set to flow from the Morning Star mine near Woods Point once again after the company started mining ore from as many as five stopes, the managing director of Morning Star Gold NL, Nick Garling, told the Victorian Resources Conference. Mr Garling told delegates that the refurbishment of the Morning Star mine has reached the 10th level of the mine, and development has been concentrated on the areas higher in the mine. In the June quarter Morning Star mine refurbished several levels between the 4L and 9L ahead of ore extraction. “The company Above: Nick Garling is now ready to recommence mining in the upcoming quarter,” said Mr Garling. “Work has also focused on independently reconstructing the geological model with a view to locating the most accurate sites within the mine to recommence production.” Part of this work included having the Morning Star mine comprehensively resurveyed by registered surveyors. Morning Star Gold has also completed preliminary feasibility, and costing work on a standalone treatment plant for the Morning Star mine has been completed. Mr Garling told conference delegates that in the meantime ore could be treated on a batch basis at other mills in the state. He went on to add, however, that the company’s focus is to remove the cost and risks associated with toll milling and build its own gravity gold plant on site which could also serve ore produced from Morning Star’s regional projects. The company has moved to the tender stage with various parties on a range of gravity plant options, which are currently being considered. For more information contact
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DISCOVERY JOURNAL NOVEMBER 2009
Nick Garling Managing Director, Morning Star Gold NL Phone: 02 92913888 Email:
[email protected]
POST CONFERENCE SUMMARY
Inferred resource for Geelong Geothermal power project
Heron plans to spend $A18 million at A1
Geothermal energy exploration company Greenearth Energy Limited has declared an Inferred Geothermal Energy Resource estimate of 17,000 petajoules (PJ) in a target geothermal reservoir within permit GEP10 containing the company’s Geelong Geothermal power project. Greenearth’s geothermal project, 11 km northwest of Anglesea, a town southwest of Geelong, is targeting a hot sedimentary aquifer from which to generate clean, emission free electricity. Engineering consultancy Sinclair Knight Merz completed the resources estimate for Greenearth based on its analysis Above: Mark Miller of the reservoir geology and temperature. The consultant said in a report to the company, “The projected temperature and flow for the [planned] productive wells would make the reservoir suitable for generation using Organic Rankine Cycle power plant technology”. Greenearth Energy announced its inferred resource estimate at the Victorian Resources conference. The Inferred Resource Estimate complies with the Australian Code for Reporting Exploration Results, Geothermal Resources and Geothermal Reserves (2008 Edition).
Heron Resources Limited, the new owner of Victoria’s historic A1 gold mine, plans to spend up to $18 million over the next two years to prove up the mine’s modern day potential and have it back in production from late in 2011. After falling on tough times when the previous owners of the mine ran out of cash, Heron picked up the assets and plan to continue the successful appraisal of the area. Speaking at the Paydirt 2009 Resources Victoria Conference, Heron’s Managing Director Mathew Longworth said that the evaluation program for the A1 mine was realistic in an area that was highly prospective and underexplored. Above: Mathew Longworth “We are focused on ounces, not tonnages, are well cashed up and are able to undertake work through the evaluation phase for A1 without having to raise further capital,” Mr Longworth said. “This is an opportunity to get into gold production within our own capability, considering the non-availability of project finance and being at a mine site which was Victoria’s longest serving mine – operating from 1861 through to 1992 when A1 closed down due to antiquated infrastructure and low gold price.” “The immediate focus is on progressing the exploration decline to access drilling locations, and undertake bulk sampling of stockworks and reefs in the historic workings. The decline will be eventually useful for production,” he added. Mr Longworth said that Heron expected to commence feasibility studies by late next year, with commencement of new production in just two years. “The Mansfield area has been a sleeper for last number of years but we are excited by its future potential as our first cash flow,” he said.
The Inferred Resource estimate of “stored heat energy” covers an area of approximately 100 square kilometres (km2). The target reservoir has an estimated volume of 55 cubic kilometres (km3) and has the potential to host a significant geothermal field. Greenearth Energy’s Managing Director Mark Miller said at the conference, “This is a major step forward in our quest to deliver renewable, sustainable, base load, emissions free energy. Given its location close to our two major Victorian cities, Geelong and Melbourne, and proximity to existing energy infrastructure, the possibilities it presents for both the state and the company are truly exciting.” “We have here the potential, over the next few years, to commence the development of Victoria’s first Hot Sedimentary Aquifer geothermal resource.” For more information contact
Mark Miller Managing Director Greenearth Energy Phone: 03 9620 7299
“We have here the potential, over the next few years, to commence the development of Victoria’s first Hot Sedimentary Aquifer geothermal resource.”
DPI would like to thank all speakers, sponsors, delegates and exhibitors who participated at the Resources Victoria Conference 2009. We hope to see you again in 2010.
For more information contact
Mathew Longworth Managing Director, Heron Resources Ltd Phone: +61 8 9215 4444
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2009 Resources Victoria Conference
TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM
Increased appetite for resources investment in Victoria
Science driving gold exploration
The appetite for risk has returned to Australia’s equities market, with a few “bounces” here and there providing the steadying influence in the rate and scope of this flush of new investment decisions, according to the Phillip Resources Fund. Addressing the first day of the of the Paydirt 2009 Resources Victoria Conference in Melbourne, the Fund’s Chief Investment Officer Chris Bain said that commodity prices had recovered well, with indications that there was significant cash available to come back into the market, and that the market’s appetite for risk had returned. Mr Bain added that many recent equity issues had been oversubscribed and “hot money” was piling in where good exploration results were evident. “While I believe there is no doubt a recovery is underway, there is perhaps some over confidence in the speed of that recovery,” he said. “And the message is – it is still all about China. Underlying demand and a reduction in domestic Chinese supply has boosted seaborne trade to the great advantage of many Australian minerals companies.” Above: Chris Bain Mr Bain said that Chinese companies had been scouring Australia for resources and that it was hard to find a quality asset that did not have a deal attached to it. “The big picture remains intact and the commodity price boom that peaked last year was because of both excess demand and undersupply,” he explained. “We have had a “And the message is – break in the cycle and it is still all about China. demand has certainly eased but unlike many Underlying demand and previous busts, supply a reduction in domestic has also contracted.” Mr Bain said that Chinese supply has Victoria remained the boosted seaborne trade domain of many smaller to the great advantage of explorers and while it many Australian minerals had significant potential, the GFC had bitten hard companies.” into exploration activity. “It will take some years of solid well funded exploration, including the Government-backed Rediscover Victoria scheme, for the rewards to come – and only a spectacular success before the major companies get back on board.”
The Victorian gold rush of the 1850s was driven by raw human energy and initiative. That worked fine when plenty of gold was lying close to the surface. But times are different now, and the modern gold rush will be driven by science. That’s the message from the recently completed Gold Undercover project, the results of which were presented at the Victoria Resources Conference in August. During three years of research, geologists from GeoScience Victoria assessed the potential for buried gold under Murray Basin sediment in northern Victoria and the best exploration methods for locating the metal.
For more information contact
Chris Bain Phillip Resources Fund Phone: 0413 275 756
Above: Depth to basement model beneath the Cainozoic sediments of the Murray Basin, northern Victoria. The topography of the upper basement surface was modelled from aeromagnetic data and constrained by nearly 1000 borehole intersections.The yellow lines show the location of the 2006 seismic survey lines.
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TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM
DISCOVERY JOURNAL NOVEMBER 2009
The study concluded that there is potential for 73 million ounces of undiscovered gold, and a new 3D model of the basin shows that 45% of the area is covered by less than 200m thickness of sediments. The real strength of the research lies in the science that offers a new understanding of how gold forms and improved methods for exploring under sediment cover. A deep seismic reflection survey has provided exciting new evidence that major faults were important pathways for goldbearing fluids more than 400 million years ago. The faults have also been traced under the Murray Basin sediments in a gravity survey that provides gold explorers with new data for targeting the most prospective mineralised areas. (continued opposite)
POST CONFERENCE SUMMARY
M 2009 Resources Victoria Conference TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM 2009 Resources Victoria Conference TECH
M 2009
Seamless geological data for Western Victoria The faults have also been traced under the Murray Basin sediments in a gravity survey that provides gold explorers with new data for targeting the most prospective mineralised areas
A major rework of geological maps and datasets of Victoria is underway to create a seamless three-dimensional geological map of the entire state, which will assist the discovery and exploitation of major new mineral deposits. The 1:250,000 scale geology for the western half of Victoria is now seamless, the existing 1:50,000 scale geology has also been made seamless, and a large new area of mapping at this scale in the south of the state has been added. This dataset is being used by the Rediscover Victoria team to In other Gold Undercover studies, improved guidelines have been construct the 3D models of the state’s geology. developed for conducting geochemical surveys, and the nature of The project will create a seamless geology layer across the state of alteration haloes around gold deposits has been better defined. Victoria at 1:50 000, 1:250 000, 1:1,000,000 and 1:4,000,000 scales. One of the most useful alteration features for explorers is the The work involves: envelope of carbonate spots and veinlets that surround most gold • Matching geological deposits. The spots can be revealed by simple chemical stains. boundaries and polygons DPI has delivered a range of new geoscience insights and across pre-existing map edges; techniques to assist exploration for the potentially large undiscovered • Checking the accuracy gold resources concealed under cover, and these are available of older maps against in a series of free reports through DPI’s online store. radiometrics, topography, Go to www.dpi.vic.gov.au/minpet/store. aeromagnetics, aerial photos, boreholes and field For more information contact observations; Paul McDonald Manager Resources • Updating stratigraphic names Above: Progress of seamless geology 1:250 000 GeoScience Victoria data. The seamless geology team. and reconciling name changes Email:
[email protected] across map edges; and • Assigning many geological attributes to geological units, boundaries and faults. The new geological data is available as a DVD, with seamless geology layers for western Victoria at 1:50,000 and 1:250,000 scale available in ESRI and Mapinfo formats, registered geophysical images, geological interpretation of 1:1 000 000 and 1:500 000 geophysics, mineral occurrence and production data and exploration geochemical data. In addition, a report detailing the updated stratigraphy and name changes for the Bendigo Zone has been released, with numerous photos of critical outcrops: GSV Report 2009 Resources Victoria Conference 129 - Rock unit names in the Bendigo Zone of central TECHNICAL FORUM presentationS Victoria, Seamless Geology Project. The seamless now availabLE on a CD from the DPI Online store. 1:250,000 geology data for western Victoria is also available on the OneGeology portal – a www.dpi.vic.gov.au/earth-resources website (www.onegeology.org) that is making dynamic geological map data of the world accessible over the Internet. For more information contact
David Higgins Geospatial Information Officer GeoScience Victoria Phone: +61 3 9658 4506 Email:
[email protected]
TECHNICAL FORUM 2009 Resources
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2009 Resources Victoria Conference
TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM 2009 Resources V
A new geological concept for Central Victoria Parts of central Victoria may be more ‘exotic’ than they first appear! New research suggests that the bedrock beneath central Victoria - the Selwyn Block, the northern part of a ‘Tasmanian microcontinent’ - may be a blow-in from the south Pacific. Building on the success of the pmd-CRC T13 deep seismic transect across central Victoria in 2006 (see Discovery articles July 2007, April 2008), GeoScience Victoria is investigating potential geological reconstructions of Gondwana. The aim is to reduce exploration risk by inspecting geological models (even up to sub-continental scales) to see which ‘stack up’ in light of the new seismic data. The bonus for Victoria is a greatly improved understanding of the original context of our mineral systems, with potential to greatly enhance the prospectivity of previously underexplored regions. The new GSV work has Australia – including Victoria cherry-picked the best – was once part elements of published of the Gondwana tectonic reconstructions, supercontinent. This began to added new constraints break up around from the seismic data, and 200 million years mixed them together. ago, with Australia separating around 95 million years ago. Victoria’s major bedrock mineral systems were formed 500 to 370 million years ago at a time when Gondwana was undergoing growth, developing new rock and mineral systems. Understanding exactly how and when today’s continents fitted together in Gondwana is critical to inter-continental – and even interstate – correlations, yet analysis of published models for the southeast Australian region has revealed significant shortcomings. Many models are mutually exclusive. One recent geological theory, the central Victorian ‘Selwyn Block’ concept, received a boost from the 2006 seismic programme which successfully imaged this body beneath younger cover rocks. No published continental-scale geological reconstructions can easily accommodate the Selwyn Block concept back to the time of generation of Victoria’s major mineral deposits. A paradox introduced by the Selwyn Block is that its geology shows some very close similarities to far western Victoria, but big differences with intervening rocks such as those at Bendigo and Ballarat. This paradox cannot be explained within existing models – a new reconstruction is needed.
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DISCOVERY JOURNAL NOVEMBER 2009
Below: A previously published, and widely accepted, reconstruction of part of Gondwana as it was 100 million years ago, centred on Victoria. The results of the new work are summarized by the yellow shaded area-extending beneath central Victoria-that shows the proposed extent of crust belonging to the exoticTasmanian microcontinent that accreted to the eastern Gondwana margin in the Cambrian, over 500 million years ago.
The new GSV work has cherry-picked the best elements of published tectonic reconstructions, added new constraints from the seismic data, and mixed them together. After vigorous stirring and cooking on ‘high’, a new tectonic scenario has emerged that argues for an exotic origin for Tasmania and central Victoria in the Cambrian with respect to the rest of Gondwana. As well as being able to explain the presence of the Selwyn Block beneath central Victoria, the new scenario explains some of the more confounding evolutionary differences - and some surprising similarities - that have existed in the geological datasets of the Delamerian and Lachlan orogens in Eastern Australia, Tasmania, and the Ross Orogen in East Antarctica, for many years. For further information contact:
Ross Cayley Senior Geologist GeoScience Victoria. Phone: 03 9658 4517
TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM 2009 Resources Victoria Conference
POST CONFERENCE SUMMARY
Victoria Conference TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM
2009 Resources Victoria Conference TECHNICAL
New techniques in regional 3D geological mapping, simulation and visualisation Images: Left: Simulation of strain partitioning and fault development in western Victoria during the Paleozoic. Below: Tim Rawling, 3D Modelling Manager
Explorers will be able to assess the value of the different simulation techniques and methods, after which they will be able to run simulations related to their own exploration problems at smaller scales.
The Rediscover Victoria 3D program is developing a sophisticated 1:250,000 scale 3D model of the earth’s crust across Victoria to provide new 3D data that will assist existing minerals and energy explorers. It will also help determine nextgeneration exploration targets, such as potential geothermal sources and carbon geosequestration sites. The 3D modeling work, incorporating onshore and offshore geology, will provide a robust geometric framework for analysing controls on the formation and accumulation of resource systems. New models of the Murray Basin, Bendigo zone and Otway Basin (and work underway in the Gippsland Basin) is allowing integrated analysis of complex systems such as the pressure regime within a basin undergoing simultaneous irrigation from onshore freshwater aquifers, drawdown of offshore oil and gas reservoirs and injection of captured CO2. Models are stored in a 3D Model Management System (3DMMS), a geospatially aware database developed for GeoScience Victoria by Runge Ltd. The system stores models with associated metadata and can be searched or queried accordingly. The 3DMMS also provides a data format conversion, reprojection, visualisation and delivery mechanism, so that explorers can upload their own 3D data into a secure and confidential part of the database. They can then visualise their data with whichever model objects they choose (available in stereo in DPI’s 3D visualisation room in Melbourne.) The successful application of these 3D datasets to real exploration questions will be the true test of their value. To this end, GSV is
initiating “pilot” valueadd projects utilising the 3D model outputs to constrain numerical simulations and 3D inversions. Models have been developed to investigate the distribution of stress and the nature of fluid flow during deformation, geometrically constrained heat flow (particularly beneath the Latrobe Valley coal measures), and strain partitioning during the closure of an asymmetrical basin associated with a tectonic collision. Modelling is typically done at the crustal-scale as this allows better understanding of the entire system and in particular the regional controls on mineralisation. Explorers will be able to assess the value of the different simulation techniques and methods, after which they will be able to run simulations related to their own exploration problems at smaller scales. FOR MORE INFORMATION CONTACT:
Tim Rawling 3D Modelling Manager GeoScience Victoria Phone: +61 3 9658 4584 Email:
[email protected] Website: www.rvd.dpi.vic.gov.au
onference TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM 2009 Resources Victoria Conference TECHNICAL FORUM
2009
31
Mineral Exploration Tenements New applications and grants during April 2009 – August 2009
TENEMENT UPDATE
Exploration Licence Applications
Exploration Licences Grants
Tenement
Primary Owner
EL5215
B Hochwimmer & Associates Pty Ltd
EL5218
Australian Zircon NL
EL5224
Twyerould, Stephen
EL5227
Greenpower Natural Gas Pty Ltd
EL5228
Greenpower Natural Gas Pty Ltd
EL5229
Wassylko, Stanislaw
EL5231
Brimstone Resources Ltd
EL5232
Goldsearch Ltd
18/6/09
EL5233
Twyerould, Stephen
EL5234
Connor, Glenn
EL5235
Golden Deeps Ltd
EL5218
Application Date
Tenement
Primary Owner
23/3/09
EL4221
Gipps Ausx Pty Ltd
22/8/97
8/4/09
8/4/09
EL5040
Strategic Energy Resources Ltd
26/3/07
31/7/09
4/5/09
EL5125
Rocky Mining Pty Ltd
22/11/07
3/6/09
29/5/09
EL5126
Rocky Mining Pty Ltd
22/11/07
3/6/09
29/5/09
EL5127
Ausgold Exploration Pty Ltd
23/11/07
15/7/09
9/6/09
EL5128
Ausgold Exploration Pty Ltd
23/11/07
27/3/09
15/6/09
EL5161
Beaconsfield Gold Mines Pty Ltd
EL5166
Castlemaine Goldfields Ltd
18/6/09
EL5173
Cuevalley Pty Ltd
18/8/09
EL5177
Maldon Resources Pty Ltd
1/8/08
8/4/09
24/8/09
EL5186
Sovereign Gold NL
8/8/08
8/4/09
EL5187
Iluka Resources Ltd
12/8/08
26/8/09
EL5189
Nagambie Mining Ltd
28/8/08
31/7/09
EL5190
Highlake Resources Pty Ltd
29/8/08
6/5/09
EL5191
Iluka Resources Ltd
18/9/08
26/8/09
EL5193
Ballarat Investment Project Mgmt PL
2/10/08
27/3/09
EL5198
Jabiru Metals Ltd
5/12/08
24/4/09
EL5203
Oscar Mining Pty Ltd
2/1/09
22/6/09
Mildura
^
EL5219
Swan Hill
^
EL5203
EL5220
EL5223
Horsham
^
EL5230
EL5211 EL5128
EL5191
EL5231
EL5187
EL5127 EL5214
Bendigo
EL5222 ^ EL5177
10/2/09
3/6/09
26/2/09
22/6/09
EL5212
Resolve Geo Pty Ltd
2/3/09
3/6/09
EL5214
P S & G F Forwood Pty Ltd
11/3/09
20/5/09
EL5216
Petra Minerals Pty Ltd
31/3/09
3/7/09
EL5217
Twyerould, Stephen
6/4/09
12/8/09
EL5219
Australian Zircon NL
8/4/09
22/6/09
EL5220
Gold Fields Australasia Pty Ltd
15/4/09
31/7/09
EL5221
Twyerould, Stephen
16/4/09
3/7/09
EL5222
Twyerould, Stephen
16/4/09
3/7/09
EL5223
Iluka Resources Ltd
1/5/09
31/7/09
EL5225
Petra Minerals Pty Ltd
7/5/09
3/7/09
EL5226
Iluka Resources Ltd
11/5/09
15/7/09
EL5230
Brimstone Resources Ltd
15/6/09
26/8/09
EL5233
Wodonga EL5224
EL5126 EL5198
EL5125
EL5189
EL5225 EL5193
EL5234
Ballarat
EL4221
EL5232
^
Melbourne
Geelong
Warrnambool
EL5215
EL5235
EL5161
Bairnsdale
^
^
8/4/09
Resolve Geo Pty Ltd
EL5216 EL5166
^ ^
28/7/08
EL5221
^
Portland
24/4/09
Sovereign Gold NL
Shepparton ^ EL5217 Wangaratta ^
Hamilton
EL5040
15/7/09
4/7/08
EL5210
^
EL5186
11/6/08
EL5211
EL5190
EL5226
Application Granted
^ EL5228 EL5210
EL5227
Traralgon
^
EL5173 EL5229
EL5212
Applications
N
Granted Current
Complete mineral, petroleum and extractive tenement details are available from www.dpi.vic.gov.au/minpet/geovic 32
DISCOVERY JOURNAL NOVEMBER 2009
Earth Resources Business Centre
Resources Sector Websites David Gallus
Manager, Strategic Geoscience
Tenements Registration Officer
T: (613) 9658 4536
[email protected]
T: (613) 9658 4454
[email protected]
Earth Resources Regulation
Kim Ricketts
Doug Sceney
Executive Doug Sceney
Acting Executive Director, Earth Resources
T: (613) 9658 4451
[email protected]
GeoScience Victoria Kathy Hill
Director, Earth Resources Regulation
T: (613) 9658 4451
[email protected] John Mitas
Manager, Minerals and Extractive Operations
T: (613) 9658 4422
[email protected] Terry McKinley
Director, GeoScience Victoria
Manager, Petroleum and Geothermal Operations
T: (613) 9658 4562
[email protected]
T: (613) 9658 4414
[email protected]
Linda Bibby
David Boothroyd
Manager, Geoscience Information
Manager, Earth Resources Tenements
T: (613) 9658 4511
[email protected]
T: (613) 9658 4439
[email protected]
Peter O’Shea
Manager, Minerals Geoscience
Earth Resources Policy
T: (613) 9658 4525 peter.o’
[email protected]
Acting Manager, Earth Resources Policy
Danny Suster
Manager, Resources
T: (613) 9658 4804
[email protected]
T: (613) 9658 4531
[email protected]
Minerals Development
Paul McDonald
Dr. Geoff O’Brien
Manager, Energy Geoscience
T: (613) 9658 4538 geoff.o’
[email protected]
Kathy Friday
Minerals Development Manager
T: (613) 9658 4407
[email protected]
T: (613) 9658 4410
[email protected]
Business Development and Facilitation Sean Rooney
Acting Director, Business Development and Facilitation
T: (613) 9658 4739
[email protected] Gordon Chakaodza
Senior Resources Development Officer
T: (613) 9658 4401
[email protected] Geoff Collins
Petroleum Development Manager
Department of Primary Industries 16th Floor, 1 Spring Street GPO Box 4440 Melbourne Victoria Australia 3001 T: (613) 9658 4440 F: (613) 9658 4760
[email protected]
Seismology Research Centre www.seis.com.au University of Ballarat Geology Department www.ballarat.edu.au/ard/sci-eng/geology University of Melbourne School of Earth Sciences www.earthsci.unimelb.edu.au
Government Australian Governments Geoscience Portal www.geoscience.gov.au Department of Regional Development, Primary Industries, Fisheries and Resources www.minerals.nt.gov.au Department of Mines and Petroleum, Western Australia www.dmp.wa.gov.au Department of Industry, Tourism and Resources www.industry.gov.au Department of Mines and Energy, Queensland www.dme.qld.gov.au
Environment Australia www.environment.gov.au Renee Kjar
Acting Manager, Coal Development
T: (613) 9658 4703
[email protected]
Clean Coal Victoria Charlie Speirs
Director, Clean Coal Victoria
T: (613) 5160 9000
[email protected]
Carbon Capture & Storage Coordination Fiona Clarke
Director, Carbon Capture & Storage Coordination
T: (613) 9658 4495
[email protected]
T: (613) 9658 4406
[email protected]
Information at DPI
RMIT Department of Civil and Chemical Engineering www.rmit.edu.au/eng/civil-chem
Department of Primary Industries, Victoria www.dpi.vic.gov.au
Executive Cliff Kavonic
Monash Earth Sciences www.earth.monash.edu.au
Department of Primary Industries, New South Wales www.minerals.nsw.gov.au
Energy Resources Development Division
Acting Executive Director, Energy Resources Development
Academic
CONTACTS
Earth Resources Division
Geoscience Australia www.ga.gov.au Mineral Resources Tasmania www.mrt.tas.gov.au Primary Industries and Resources, South Australia www.pir.sa.gov.au
Peak Bodies Australian Petroleum Production and Exploration Association www.appea.com.au Cement Concrete and Aggregrates Australia www.concrete.net.au Construction Material Processors Association www.cmpavic.asn.au
Information Development Boris Rudoy
Manager, Information Development
T: (613) 9658 4571
[email protected]
Corporate Communications
Minerals Council of Australia (Vic) www.minerals.org.au/victoria Prospectors and Miners Association of Victoria www.pmav.asn.au Victorian Mining Wardens Court www.miningwarden.vic.gov.au
Alistair King
Communication Manager, Energy and Earth Resources
T: (613) 9280 3928
[email protected]
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