BHP Collieries Division operates five underground coal mines in and around the Illawarra region of NSW. They include the Appin and Tower mines which are situated north-west of Wollongong and some 75 kilometres from Sydney. These two mines produce around 3.5 million tonnes of coal per year which is primarily used for domestic steel making. Some coking and energy coal is also exported.
Gaseous methane is contained within subterranean coal seams and is a potential safety hazard because of its explosive nature. Methane is also a greenhouse gas with a greater greenhouse potential than carbon dioxide. (One kilogram of methane is equivalent to 21 kilograms of carbon dioxide in terms of greenhouse warming potential (Future directions for Australia's National Greenhouse Strategy - discussion paper, March 1997. Prepared by the Intergovernmental Committee on Ecological Sustainable Development.))
Approximately 250 million cubic metres per year of methane was being released to atmosphere from the Appin and Tower mines. This was seen as a wasted resource.
Cleaner Production Initiatives
BHP, in conjunction with Energy Developments Limited and Lend Lease Infrastructure, has developed a power generation plant that uses the waste methane to generate up to 94 megawatts of electricity - enough to power 60,000 homes.
Supply of the fuel for electricity generation is achieved by capturing methane from within and below the coal seam. It is piped to the generation plants on the surface where it is distributed to a series of modular gas engines that drive electrical generators. At the Appin site, the captured methane is supplemented by supplying mine ventilation exhaust as the air feed to the gas engines. A significant proportion of the low purity methane in the mine ventilation air is thereby utilised by this innovative practice.
Natural gas supplied by pipeline is used as supplementary fuel in the event of a shortfall in methane supply from the mines.
Utilisation of both captured methane and methane in the ventilation exhaust provides a major environmental benefit in reducing the greenhouse effect associated with methane emissions. This was a significant consideration in determining the benefit of the project.
Advantages of the Process
BHP pays a fee to Energy Developments Limited and Lend Lease Infrastructure to operate the generation plant, however the energy that is generated is sold by BHP to the electricity grid. Some of the substantial gas collection costs incurred by BHP, which must be met to allow mining to continue, are recovered in this way.
Methane drainage at both mines must be carried out to allow mining to continue safely. Utilisation of the methane provides an important energy resource while reducing BHP Collieries Division's greenhouse gas emissions by approximately 50 per cent. This represents a reduction in greenhouse gas output by the equivalent of approximately three million tonnes of carbon dioxide per year.
In addition to providing an independent source of electricity for the community and the mines, the utilisation of an otherwise wasted resource reduces the amount of coal consumed in the state's power stations. This has an additional benefit in reducing total carbon dioxide emissions.
One of the main barriers experienced in this project arose from deregulation of the power industry. This made it difficult to estimate future electricity prices, which were a key consideration in determining the economic viability of the project.
The power generation plant also emits oxides of nitrogen as a by-product of the combustion process and these can contribute to the formation of photochemical smog. A management plan for reducing nitrogen oxide emissions when ambient ozone levels approach target levels is in place. This plan was developed in conjunction with the EPA.