Current status and allowable activities

The following measures related to onshore gas are currently in place in Victoria:

  • a hold on granting new exploration licences for all types of onshore gas (tight, shale, coal seam and conventional gas)
  • a hold on approvals for hydraulic fracturing
  • a hold on exploration drilling activities
  • a ban on the use of BTEX (benzene, toluene, ethylbenzene, xylene) chemicals, which has been enshrined in legislation
  • scientific studies to understand the possible impacts of a potential onshore gas industry on Victoria's surface water and groundwater.

On 26 May 2015 the Victorian Government requested the Environment and Planning Committee to examine issues relating to the exploration, extraction production and rehabilitation of onshore unconventional gas. This work has now concluded and the Inquiry into Onshore Unconventional Gas in Victoria report was tabled in Parliament on 8 December 2015. The report will be thoroughly considered and will help inform the Government’s longer-term position on this important matter. While the Government considers its response to the report the hold, or moratorium, on new exploration licences and tenements for onshore gas, hydraulic fracturing and exploration drilling will remain in place. This decision restricts the activities that may be approved for existing tenement holders. The restrictions apply to licences under the Petroleum Act 1998 (Petroleum Act) and the Mineral Resources (Sustainable Development) Act 1990 (MRSDA).

Exploration activities – approvals on hold

Under these arrangements, there is a hold on approvals to conduct the exploration activities listed in the table below:

Activity

Description

Drilling

Construct drill pads or drill holes for petroleum wells under the Petroleum Act (oil and gas) or the MRSDA (coal seam gas and oil shale).

Hydraulic fracturing (fracking)

Perform hydraulic fracture stimulations of reservoirs under any circumstances.

Install production wells

Drill a well and install equipment to allow the well to produce oil or gas from an onshore reservoir.

Perform well tests, such as production tests or pump tests

Tests on existing wells to understand the properties of a reservoir, such as flow rates and pressure, and its capacity to produce oil or gas.

Flare gas

Burn off gas as a waste product from petroleum exploration tests.

Collect samples from drill holes and perform analyses

Collect samples from drill holes to measure rock properties or test for hydrocarbons.

DEDJTR will continue to assess and consider approving applications for the suspension of conditions and associated extension of petroleum and geothermal authorities until the outcome of the Parliamentary Inquiry into onshore unconventional gas is known. While the Parliamentary Inquiry is underway the moratorium on all onshore gas activities will continue. This includes a hold on approvals for fracking, a hold on onshore gas drilling and a ban on the use of BTEX chemicals.

Petroleum Permits – Suspension and Extension (S&E)

The following Petroleum-Titles-List-of-Suspension-and-Extensions (DOCX 15.79 KB)DOCX icon have been approved during the moratorium on all onshore gas activities.

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Petroleum Permits 

Exploration activities that may be approved

Existing tenement holders may still apply for approval to conduct the exploration activities listed in the table below:

Activity

Description

Desktop studies

Compile and analyse existing information, analysis and interpretations from reports, databases, etc. without collecting any new data.

Geophysical investigations, such as seismic surveys or gravity surveys

Surveys to collect information on the physical properties of the earth. Sampling methods range from field work by technicians walking across the land to aircraft flying a grid or trucks collecting seismic data.

Undertake environmental studies

Scientific studies to inform risk assessments and mitigation actions for operation plans or work plans.

Rehabilitation works

Work to rehabilitate land to an agreed state.

Measurement and monitoring of authorised activities

Activities to monitor the progress of authorized activities against an approved operation plan.

Collect surface samples and perform analyses

Collect samples from the surface to measure rock properties and test for hydrocarbons.

Mapping

Map the surface and subsurface geology or water aquifers, interpret information to produce maps and models.

Community engagement

Working with the community to increase their understanding of a project.

Baseline data acquisition

Collect baseline data for environmental monitoring purposes.

Soil gas sampling

Sampling to measure the amount and types of gas in the soil.

Work on Special Drilling Authorisations

Any authorised activity on a Special Drilling Authorisation, for example to access gas in offshore reservoirs.

Production activities under the Petroleum Act

Production licence holders with operating production wells under the Petroleum Act will be able to apply for approval to carry out works on those production wells for safety and environmental management purposes, to maintain well integrity and efficiency. This applies to existing licence holders storing natural gas obtained from offshore sources, storing carbon dioxide and producing carbon dioxide.

Activity

Description

Gas storage (injection and production)

Pump gas into and recover gas from underground storage.

Well work overs and maintenance

Routine maintenance of an operating production well or repairs to parts of the well.

Flare gas

Burn off gas as a waste product from petroleum operations.

Pipeline infrastructure

Install pipelines for the transport of oil and gas.

The strong legislation already in place for the earth-resources sector continues to apply. Under the existing legislation, tenement holders must not:

  • Undertake activities that are not authorised for a licence type, such as commercial production from an exploration permit.
  • Undertake any activity that is not covered by an approved operation plan (Petroleum Act) or an approved work plan (MRSDA).

It is an offence under the Acts to carry out unauthorised activities. Substantial penalties apply for offences under the Acts. A licence may also be cancelled for failure to comply with the Acts or the associated regulations.

In Victoria, as at December 2015 there are:

  • 10 current mineral exploration licences that cover coal seam gas
  • no mineral mining licences with approved work plans for coal seam gas production
  • 11 current petroleum exploration permits that cover tight and shale gas
  • three current retention leases that cover tight and shale gas; none of these have approved operations plans for tight and shale gas production.

Community engagement program

A  community and stakeholder engagement program, led by independent facilitators, was undertaken to understand Victorians' views related to onshore gas in Victoria. The engagement program is now complete and the final report has been prepared by the independent facilitators.