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October 2001. A multi-billion-dollar resources
project to convert coal to liquefied gas and diesel fuel as well as build a
1000-megawatt power generator is being considered by investors for the Latrobe
Valley brown coal reserves. Costing more than $1 billion, the consortium is
working with scientific advisers so that the plant avoids releasing carbon
dioxide emissions, instead working out ways for emissions to be pumped into
nearby underground reservoirs where a portion of the carbon dioxide reacts with
its environment to form limestone.
Coal reserves in the region amounted to 160,000 million tonnes and the current operations used just 65 million tonnes.
The components of the industry are;
| Formaldehyde adhesive by Orica, |
| Methanol synthesis at pilot scale by BHP Petroleum (with Orica Katalco of the UK) Wyndham 20 km west of Melbourne, Victoria. This project is being acquired by a joint venture of Coogee Chemicals (80%) and Australian Submarine Corporation. |
| Nufarm - 2,4-D, trifluralin and metham sodium at Laverton. (Produces about 6 000 tonnes of chlorine to produce 2,4-D and trifluralin herbicides.) |
| Monsanto - glyphosate herbicide at West Footscray (exclusively distributed through Nufarm since May 2002 valued at A$100m pa. |
Symex Holdings fatty acids (20 000 tonnes) and glycerol at Port Melbourne.
Orica producing 14 000 tonnes of chlorine including for use for the manufacture of Cereclor (chlorinated polyethylene use as fire resistant electrical insulation) at Yaraville, near Melbourne.
Many formulators of paints, adhesives, cleaning chemicals, pesticides etc
including Rohm and Haas at Point Henry (acrylic emulsions) and Gibson
Chemicals.VSP Industries. The facility
has produced a wide range of chemical products including alkyds, polyesters,
esters, defoamers, plasticisers, acrylic emulsions, epoxies, polyamides,
acrylic and vinyl acrylic latices, paper chemicals, customer specified
blends and specialty barrier coatings and other chemicals. Available
for acquisition.
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| Methanol | Coogee and ASC |
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A chloralkali-based petrochemical complex was evaluated by ICI in the 1970s for Point Wilson and there have been substantial expansion plans at the Altona complex to utilise ethane reserves to increase production of polyethylene resins. For the last two decades however, expansion has largely been capped by growth in the Australian market with closures of smaller high cost operations.
Victoria's petrochemical industry developed during Australia's protectionist era and the reduction of tariffs from around 60 per cent up to the 1960s, to 5 per cent today promoted extensive industry rationalisation and closures. The core of the industry has remained after extensive efficiency improving measures including the shedding of labour - typically one-third for larger operations. Nevertheless inadequate scale and lack of comparative advantage serves to continue to constrain its outlook. The great irony is though established under high import tariffs, the petrochemical industry at Altona would today have been more export-oriented in their absence. Tariffs underpinned weaker competing operations. The Bass Strait gas provided for cheap petrol and supernormal profits (100 per cent returns on shareholders funds for one major operator) but not one significant industry can today be attributed to it. That status is not predicted to change without subsidies and the status today a monument to inept policies.
See also national chemical
industry
and trade performance.
| Western Australia |
| South Australia |
| New South Wales |
| Queensland |
Oil and Gas
Though oil production is declining to 300 000 barrels per day at projected
demand, gas will be available for another three decades.
Gas from Bass Strait contains around 400 000 to 500 000 tonnes of ethane per year of which only around 200 000 tonnes is extracted for use by the Altona (and West Footscray) complex.
Bass Strait (Gippsland Basin) crude oil and gas (owned by BHP and Esso) is brought ashore by pipeline to a treatment and separation plant owned by Esso at Longford, Victoria (subject to an explosion in September 1998). The plant produces;
| Sales gas - principally methane gas with some ethane. It is distributed from Dandenong for domestic and industrial use. Capacity is 990 Tj/day. |
| Stabilised crude oil is transferred to the Westernport harbour for shipping and pipeline distribution to the refineries at Altona and Geelong. |
| Intermediate mixture of ethane, propane and butane transferred by pipeline to Westernport for a fractionation process. At Westernport the ethane gas is separated from the propane and butane and transferred by pipeline to the petrochemical operations at Altona and West Footscray. |
There is also a 151 km line from Wagga in New South Wales to Barnawatha,
near Wodonga in Victoria supplying up to 90Tj/day for Victoria's gas grid.
Port Campbell gas capable of supplying to100 Tj/day
The Esso/BHP monopoly is being challenged by another partnership in which Esso/BHP have a 50 per cent equity. The other partners are Shell Australia, Australian Worldwide Energy, News Corporation and Petroz with which they have an interest in the Kipper field and who, with Gulf Oil have an interest in Manta and Gummy fields. Kipper is needed to economically develop the Manta and Gummy fields. Esso/BHP reluctant to lose their monopoly position and there is interest in buying them out of Kipper. These three fields would lead to a processing plant at Orbost, north east of Longoford that could supply 30 per cent of Victoria's gas needs (at a cost of $700m). (It is worth noting that an explosion at Longford in August 1998 totally disrupted gas supplies in Victoria.).
Bass Strait oil reserves are about 87 per cent depleted (2001) but identified gas reserves are less than 50 per cent used.
| Historical relevance. |
AltonaMelbourneSale
(Bass Strait)
