Basin review, Distribution, Gas, Markets, Projects, Technology

Gas gets going around Gippsland

Construction of the South Gippsland Natural Gas Project (SGNGP) began in 2006. In total, the project cost $55 million, partially funded by the Victorian Government’s commitment of $70 million to the Natural Gas Expansion Program (NGEP).

The NGEP was announced in 2003 and involved connecting 34 Victorian towns to gas. More than 1,000 km of pipeline was laid under the program, making it the biggest gas rollout in provincial Victoria since the 1970s. Jemena says the South Gippsland Project was the most complex and challenging of all the gas projects under this program.

The South Gippsland component of the project involved connecting towns to the BassGas Processing Plant, southeast of Lang Lang, to commercialise gas from the Yolla gas field in the Bass Strait. The Yolla field, located 147 km off Victoria’s east coast, is owned by a joint venture of Origin Energy, AWE and CalEnergy.

The towns of Lang Lang, Korumburra, Leongatha, Wonthaggi and Inverloch were connected as part of the SGNGP.

Getting the gas to South Gippsland

In March 2007, Delco Australia was awarded the contract for construction and testing of the 66 km steel transmission pipeline. Construction followed soon after in April 2007. The pipeline was constructed in three sections: BassGas Plant to Korumburra, Korumburra to Leongatha, and Korumburra to Wonthaggi. Steep terrain, river crossings and sensitive environmental areas meant that 35 horizontal directional drills were completed during construction of the transmission pipeline.

Along with the transmission pipeline, the project included construction of 220 km of supply and distribution pipeline. Theiss Services and Tenix jointly undertook construction of this component of the project, commencing in mid-2006. The supply and distribution pipeline has a maximum allowable operating pressure of 10,200 kilo Pascals.

Multinet and gas retailer Red Energy began connecting residents to gas from March 2009. Inverloch was the final town to be connected to gas in December 2009.

In order to connect towns to gas, the project also called for the construction of two new city gates, located in Lang Lang and Korumburra. Jemena has plans – and capability – for three more city gates in South Gippsland to accommodate future load increases. The project also called for the construction of two custody transfer metering stations, one at the BassGas Station and the other in Lang Lang.

Tricky terrain (and other challenges)

With the new gas network operating in a non-principal transmission system, Jemena faced a number of challenges in getting natural gas to residents in South Gippsland.

The construction phase brought many challenges – some anticipated, some not. There was some very hilly, undulating terrain in the area, requiring extensive and exhaustive planning during the construction phase. Techniques to overcome the terrain challenges included the use of foam trench breakers, developing new brackets for the pipeline and new installation methods to accommodate the pipeline in certain locations. Furthermore, the pipeline passed through a number of private properties, requiring construction crews to minimise any disruption to and impact on landowners.

Although sites of cultural significance were identified by a heritage archaeologist prior to construction, a number of cultural heritage artefacts were discovered along the right of way during construction. To manage these issues, a number of Aboriginal monitors were on site during the construction phase, enabling heritage issues to be resolved quickly so that construction could continue.

Another unexpected discovery along the way was of giant Gippsland earthworm colonies. Being an endangered species with a limited habitat, these discoveries required investigations, resulting in delays. There were also delays resulting from inclement weather.

Safety was paramount in the project, says Jemena, and all operational health and safety issues were raised and covered before construction began. During the construction phase, especially during construction of the transmission pipeline, there was a full time operational health and safety representative on site. Jemena also held regular “tool box”? meetings to discuss and address health and safety issues.

Securing commercial agreements with a number of stakeholders, including the gas retailer and the gas supplier, was one of the major challenges. Jemena says it took resources, time and effort to resolve the issues and reach the necessary agreements, which were finalised in early 2009.

Jemena also undertook a detailed community relations plan, which involved liaising with a number of stakeholders involved in the project. These included the local councils, landholders affected, major community groups, local MPs and service providers. Information sessions were held in all five towns, providing information to residents including ongoing advertising and letter drops to residents about the benefits of natural gas and how to arrange a gas connection.

Gaining from gas

Jemena, on behalf of Multinet Gas, is currently connecting end-use residents to natural gas in each of the connected towns. Gas has been made available to approximately 10,000 properties as part of the development. At the time of writing over 2,000 South Gippsland residents had requested a gas connection. New gas connections are being made weekly, says Jemena.

Notably, almost all major commercial and industrial customers in the five towns have been connected to natural gas, including hospitals, most schools and a number of industrial businesses.

Increasing gas distribution across the state can provide a multitude of benefits to residents. Victorian Minister for Regional and Rural Development Jacinta Allan says “Average households can save between $600 and $1,200 per year by converting from LPG. A medium business can save up to $30,000 a year. For some big businesses that annual saving can be hundreds of thousands of dollars.”?

A KPMG report found that the NGEP would provide a $427.6 million economic boost over the period 2004-24 and create 395 new full-time equivalent jobs. Of this, $57.14 million and approximately 59 full-time jobs would accrue to the South Gippsland region.

Along with the cost benefits, Jemena notes that gas is an environmentally friendly energy source and gives householders and businesses a greater choice when selecting appliances such as heating, hot water units and cook tops.

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