Santos' plans to treat and dispose of coal seam gas waste water from its $2 billion project in northern NSW would pose a "significant environment risk" and face rejection, government agencies said.
The company has been told by the Division of Resources and Energy (DRE) to resubmit plans for the Leewood Produced Water and Beneficial Reuse Project "with the required information" by June 5 or the application "will be refused".
Among the litany of demands, the NSW Environment Protection Authority wants to know what Santos plans to do with the expected 500,000 litres of brine produced daily from the Narrabri Gas Project, which had the potential to exhaust storage capacity after three years of the five-year venture.
"In the absence of a detailed commitment for the lawful disposal of brine, the EPA has concluded that this issue presents a significant environmental risk and is unable to support this proposal in its current form," the agency said.
The Department of Primary Industries also raised concerns about the "high risk of having significant adverse impacts and potential loss" of agricultural capacity from the use of treated CSG water for irrigation.
The agencies also raised issues about apparent inaccuracies in the design of an irrigation scheme, the absence of contingency plans if the reverse-osmosis plant was not operating, and the absence of information about BTEX chemicals and heavy metals
Monitoring bores were even located upstream of the proposed irrigation areas.
"Such a broad cross-section of departments is raising pretty deep and fundamental concerns about this project," Lyndon Schneiders, national campaign director of The Wilderness Society, said. "There are some issues being raised here that look unmanageable."
Peter Mitchley?, general manager for the Santos NSW gas operations, said many of the questions raised in the project's review of environmental factors were "irrelevant" to the project being put forward, including assumptions that it would be always operating at full capacity.
"We are going to produce high-quality water whose chemistry we understand exactly, and use it on soil whose structure we understand well," Mr Mitchley said, adding the company would meet next month's deadline for resubmission.
"If they want more data, no problem," he said. "If they want to condition [the project], no problem."
Stuart Khan, an associate professor at the University of NSW's School of Civil and Environmental Engineering, said the DRE had done "an excellent and thorough job".
He said it was "shocking" the government had to request basic water information revealing all the assumptions of where and how water would enter and exit the site.
"The question of what happens to all of this highly saline-concentrated brine in the long run appears not to have been seriously addressed," Professor Khan said.
"I think it's almost inevitable that the proposal to build this plant and irrigation scheme will be rejected," he said. "The lack of a viable solution for managing produced water would render the entire Pilliga CSG project unviable."
Opposition leader Luke Foley campaigned to prevent the Santos pilot project gaining a production licence during the state election.
Campaign issue
Opposition resources spokesman Adam Searle said Labor had "long-standing concerns about the risks that CSG mining poses to underground water storages in the Pilliga".
"The advice the government has received . . . should serve as a very stark warning of the dangers associated with this project," Mr Searle said. "We call on the government to heed this warning and to reconsider whether this project is safe to proceed."
Greens mining spokesman Jeremy Buckingham said the reports were "a damning indictment of Santos' project".
"The disposal of such huge volumes of toxic water or brine has always been an unsolved problem of coal seam gas and a source of concern for local farmers and communities who fear the environment will be used to dispose of this waste," Mr Buckingham said.
Energy Minister Anthony Roberts said the Leewood project now being assessed was, in effect, a desalination plant.
"[The] DRE has asked Santos to supply further detail before a decision is made," Mr Roberts said.
"These include questions around the quality and monitoring of the water that will be treated and the impacts of the use of treated water for agricultural irrigation."
