Coal Seam Methane takes centre stage


Washington H Soul Pattinson has become the latest big player to take a strategic position in the increasingly attractive energy momentum play, coal-seam methane gas (CSM), says The Australian (27/7/06, p.21)

Stake in Arrow Energy: The company, through its 60 per cent-owned coal miner New Hope Corp, paid Macquarie Bank $48.46 million for a 19.9 per cent stake in Arrow Energy – an interest it says it has no "current intention" of increasing.

Attempt on Sydney Gas: Earlier this year, Queensland Gas Co made an unsuccessful takeover lunge at Sydney Gas in an attempt to acquire CSM resources near Australia’s largest energy market.

Moranbah purchase: Last month, AGL spent $93 million to buy BHP Billiton’s 50 per cent share of the Moranbah CSM-producing operation inland from Mackay.

Arrows’s move: Arrow owns the other half. Arrow itself has just completed a takeover of CH4 to diversify its Queensland CSM asset base.

Coal seam emerging from fringe: CSM has moved from being on the fringe to emerging as an important energy source.

Huge increase in Queensland: About 40 per cent of all gas consumed in Queensland comes from coal seams, against just 2 per cent in 1998.

Potential of coal seam gas: More significantly, CSM’s potential dwarfs that of conventional natural gas.

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