Australia's underground coal gasification (UCG) industry remains under a cloud despite new environmental tests that appear to have vindicated sector leader Cougar Energy.
Cougar, which along with Carbon Energy and Linc Energy, is one of the most advanced players in UCG, received an order last Friday from the Queensland Department of Environment and Resource Management (DERM) to cease operations at its Kingaroy project after groundwater testing recorded high levels of dangerous chemicals such as benzene.
According to The Australian Financial Review, both Carbon Energy and Linc Energy were also ordered to conduct environmental evaluations of their UCG projects.
Cougar managing director Len Walker met Queensland authorities yesterday to establish when Kingaroy operations could resume after subsequent testing on the weekend confirmed Cougar's position that the original tests were incorrect, with results showing minor levels of contaminants well within Australian drinking water standards and up to 600 times less than those in the air at a suburban petrol station.
The state's Natural Resources, Mines and Energy Minister, Stephen Robertson, said he told UCG representatives yesterday that while the circumstances of each project would be evaluated individually, the Cougar contamination incident raised concerns for the future of the whole sector.
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