Queensland gas desalination project halted

Dalby Regional Council in Queensland, Australia, has decided not to proceed with a previously announced joint venture with Arrow Energy that would have seen an Aus$ 16 million desalination plant begin operations near Dalby before the end of 2009.

This would have been an upgrade of an existing desalination plant at Dalby to treat coal-seam gas water from Arrow’s nearby gas fields at Tipton West, Daandine and Kogan North. The company planned to supply up to 4-5,000 m³/d to the reverse-osmosis plant, which would then be available to supplement the town water supply.

Dalby Council voted at its meeting on 8 April 2009 not to proceed with the construction of the plant. Dalby mayor Ray Brown said final agreement could not be reached with Arrow Energy on the strict standards for the quality of water to be provided and the timeframes for obtaining of the approvals which would have been required.

“The risk profile of the project, the failure to obtain suitable terms of agreement with Arrow Energy, and the substantial capital and operating costs for the treatment of the coal-seam methane water made the project unviable,” Brown said.

“The Federal Government had recently directed a deadline to have the project commenced, which set a very tight timeframe which could not be met by both parties.”

The project was to be jointly funded by the federal government’s Australian Water Fund, the state gGovernment’s Water Subsidy Scheme, Arrow Energy and Dalby Regional Council.