Explosion that really went boom [01apr06]

WHEN the Longford gas plant exploded in 1998, Victoria went without gas for two weeks. But the disaster had a silver lining.

It highlighted the vulnerability of the state's gas supply and led to changes that are now driving a multi-billion dollar investment boom.
Now there are about $2 billion worth of gas projects under development in Victoria, drawing on the rich reserves of the Bass Strait and the recently discovered Otway Basin.

BHP Billiton commissioned its $225 million Minerva project, near Port Campbell, last year and Origin Energy is considering building a $1 billion gas-fired power station near Mortlake in western Victoria.

Santos is one of the companies investing heavily in Victoria. The company's gas marketing and commercialisation vice-president Rick Wilkinson said advances in seismic technology had helped to improve the strike rate when it came to finding gas, but he said having somewhere to sell it was just as important.









In the early 1990s, there was only one gas pipeline running out of Victoria. Now there are four, linking Victoria with New South Wales, South Australia and Tasmania.

"That four-way pipeline system allows total access to markets and demands and opportunities," Mr Wilkinson said.

The availability of gas storage onshore and reforms to the energy retailing market had also given gas and oil companies more certainty in making investment decisions, he said.

It is estimated demand for natural gas in Victoria will double over the next 20 years.

Climate change has forced a re-think on energy. Natural gas, when burnt, generates about 50 per cent less greenhouse gas than the brown coal the state has relied on.

The petroleum industry, together with federal, state and territory governments, recently announced a new strategy which aims to see 70 per cent of all new power stations driven by gas by 2015.

Victorian Energy Minister Theo Theophanous said the explosion in investment made the state's gas supply more available and more reliable than ever before. The boom had also made way for hundreds of new jobs.

"The Bracks Government has encouraged investment in these projects not only to boost our gas supply but also because they mean more jobs for regional Victorian families," he said.