Late last year, with just two weeks left before the calendar clicked over to 2014, Queensland Curtis LNG’s 540km pipeline transported coal seam gas to their newly constructed LNG refinery near Gladstone for the first time. It was a key milestone in the world’s first coal seam gas-to-LNG project. QMEB spoke to Derek Fisher, Managing Director of the company behind the project, QGC, about the momentous undertaking.
QGC reached a key milestone last year with first gas transported from the Surat Basin coal seam gas fields to your LNG terminal at Curtis Island. How was QGC able to complete such a groundbreaking task in just 3 years?
When our parent company, BG Group, and other international hydrocarbon explorers and producers entered Australia in 2008, the coal seam gas industry was in its infancy.
These companies brought technical know-how, global standards and the drive to pursue something that had not before been attempted: world-scale production of liquefied natural gas from coal seams.
But the big companies had some things to learn – about working on a large scale in communities, with thousands of wells as opposed to a relative handful, and thousands of individual interactions with local people every day.
At QGC, our two biggest achievements have been our huge step-up in safety performance and in our ongoing relationships with communities from the Surat Basin to Gladstone.
What were some of the biggest challenges QGC faced in delivering first gas on time and on budget?
The greatest challenge for the industry is safety.
QGC is augmenting support for workers on the ground, including more safety personnel being located in the field. Training of front-line workers, supervisors and site safety managers is being increased. Contractor management remains a key focus, including forums that enable us to work together on challenges.
In the broader industry, HSSE managers have been given full authority – and are encouraged – to work on issues of common concern.
For several years we’ve been delivering joint programs such as the medical evacuation helicopter service in the Surat Basin.
We have also worked together on vehicle safety initiatives in driver training and heavy haulage standards; well-head leak management; fatigue management; bushfire safety; and mutual emergency response capability.
When do you expect to produce your first shipment of LNG for the commercial market?
First LNG is scheduled for the final quarter of 2014.
What are the key milestones for QGC in 2014?
Firstly in the upstream, throughout the year we will start up a series of field compressor stations and central processing plants in our southern and central development areas, near Dalby and Chinchilla in southern Queensland.
At the liquefaction plant on Curtis Island, construction is now in its final stages. In the first quarter we will complete the first LNG tank hydro-test.
In the second quarter we will start commissioning the gas turbine generators. We will then begin commissioning Train 1, leading to the first commercial cargo in the fourth quarter, and Train 2 about six months later.
How is QGC’s water treatment program progressing? What milestones have been achieved to date?
Gas companies have a right under Queensland legislation to take water during gas production. With this right comes the obligation to treat the water for beneficial use and to “make good” any impact they have on water users.
QGC is investing more than A$1 billion on treating water for beneficial use by agriculture, industry and towns. In 2013 the third stage of our water monitoring and management plan was approved by the regulator and we completed the installation of more than 80% of a water monitoring network.
We completed our bore baseline assessment program and commissioned the first of two large state-of-the-art water treatment plants.
What initiatives has QGC implemented to manage some of the social impacts of the project on local communities?
The QCLNG Social Impact Management Plan was Queensland’s first. Under the plan, QGC is investing about A$150 million on community services up to 2014. QGC has established a A$6 million Sustainable Communities Fund for local organisations from Gladstone to the gas fields. Six consultative committees advise QGC on issues associated with the QCLNG Project.
QGC and its partners are funding about 200 new houses and units in Gladstone and the gas fields. QGC is also providing A$10.4 million towards affordable housing in Gladstone and the gas fields and about A$1 million towards indigenous housing in both areas.
Construction workers are housed in temporary camps to avoid stress on local property markets.
“First LNG is scheduled for the final quarter of 2014.”
Derek Fisher joined BG Group, parent company of QGC Pty Limited, in 2000.
He was appointed Managing Director at QGC in April 2012 after having been President and Managing Director of BG Asia, responsible for business operations in India, Singapore, Thailand, Philippines, Malaysia and East Africa. Before this, he had asset general manager roles for BG Group covering India, Tunisia, South East Asia and the Philippines.
Derek has also had board roles with Gujarat Gas and Mahanagar Gas in India and First Gas Holdings in the Philippines.
Derek is an engineer with significant experience across multiple industries, including oil and gas. He has worked in engineering and construction, satellites and aerospace and has spent 23 years on overseas assignments.
Derek has a Masters in Business Administration from Northeastern University in Boston and a Bachelor of Science in Electrical Engineering from Purdue University in Indiana.