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The Forum > General Discussion > When the CSG boom is over

When the CSG boom is over

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If you are like me, having witnessed first hand the transformation of a sleepy town into a thriving metropolis, you will no doubt agree that there have been some serious changes to the towns effected by CSG.

Going back just a few years, Miles, a small country town in the Western Downs was a laid back, quite little town of some 800 people.

Appartt from the grey nomads and the B-doubles carrying cattle, not much happened here.

A home style meal in the pub cost just over ten bucks, rents were around $120 per week and the local butcher knew everyone by their first names.

Now, that same meal, albeit a bit more professional, costs about $35, rents are fast approaching $1500 per week and the locals are becoming strangers in their own town.

The cost of block of land has gone from $7500. to $200,000 plus.

In fact, many locals in town, and in similar effected towns are now uprooting as they simply can no longer afford the rents.

So one has to wonder, given that the CSG industry boom being experienced now, is in lue of the infrastructure projects, predicted to continue for about the next six years or so, what will come of these towns once they have gone.

Investors are climbing over themselves to buy new houses up to and beyond half a million, lured by the rental returns, but you have to wonder what they will be worth once the industries infastruture phase is complete, especially if rents return to close to normality.

So, can these towns survive this CSG boom, or, will they become gost towns when the CSG boom is over.
Posted by rehctub, Saturday, 30 June 2012 6:28:20 PM
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Bet the butcher is doing a roaring trade too.

Get your point though, you'd think there needs to be some sort of reality check on these places via price caps on rent and buying houses. Much of what goes on around these ventures is practically legitimised extortion. But at what point does that head into some sort of nanny state that much of us hate. Thing is, this sort of thing has been going on for hundreds of years and once the gold/ore/oil/guano boom is over like it has happened everywhere in history, the money leaves.
Posted by StG, Sunday, 1 July 2012 9:30:51 AM
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reality check on these places via price caps on rent and buying houses
StG,
Yes, but who do you get to do the checking when Government bureaucrats are the worst offenders ? It really is Catch 22.
Posted by individual, Sunday, 1 July 2012 9:45:21 AM
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The CSG boom and the mining boom and whatever other sort of boom we might be having, are only a boom for some. They are downright bad news for a lot of people.

Yes they change the character of towns enormously. But the third phase – after the boom, doesn’t have to mean abandonment or decrepitude.

I look at towns in my part of the world – Ravenswood, which has great character, after the gold mining boom of the early 1900s left it nearby abandoned. And Greenvale, after the nickel mine closed in 1992, has a totally different type of character.

It is the enormous inequality that our primary resource booms bring that we should be most concerned about, and not be too worried about what happens to towns caught up in the midst of them.
Posted by Ludwig, Sunday, 1 July 2012 10:30:38 AM
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There are no words that convey the disgust with which Australians see the CSG rape and pillage of our land. There are no words that convey the greed and sycophantic compliance from our bastard politicians and self serving public service hierarchy to the energy companies.
Why are the Greens so silent on this issue? I have written my local members both at state and fed level…no response….none. When I have raised this issue previously on OLO some Greens directed me to their web site which has a bit about their opposition to CSG. Whoopty do, a blog, not a word in parliament, not a lock the farm gate protest, no chaining themselves to the machinery of plunder….nothing except a blog. The country is stuffed.
What I find particularly contemptuous is that MANY of those who are employed to lobby our state and fed govt’s on behalf of the energy corporations are ex National Party staffers and members, they are probably still members and further to that not a word from our federal government. CSG wells that do not defile arable land or sit above aquifers are fine, and we have them in abundance all over this vast land mass, but the tyranny of distance makes them a poor return on investment. They had the bloody hide to attempt to drill one in St Peters, they are still lobbying for it. St Peters is 4 kilometers from Sydney Town Hall, 6 Kilometers from the Opera House.

What the hell is going on in this place? Billy Hughes and Bob Menzies would be rolling around in their graves. For as diametrically opposed the boys were in their politics I believe they loved Australia, something I see in the faces of our citizens, but in none of the current crop of bastard politicians, not one little gleam of a hope from any of them.
Posted by sonofgloin, Sunday, 1 July 2012 10:52:25 AM
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*The cost of block of land has gone from $7500. to $200,000 plus*

This is what makes no sense to me. One would think that shires
would release a few more housing blocks in these places, for land
is the last thing that they are short of.

Australia will remain a mining country, so IMHO what we need is
a bunch of transportables which can be moved from site to site
every few years, as required, as long as they have a piece of land
to plonk them down on
Posted by Yabby, Sunday, 1 July 2012 11:15:26 AM
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Some good structured comments here, I thank you all for that.

In reality, the CSG boom is unlike any other boom, as once the infrastructure phase is complete, up to 90% of these workers will be gone, and my fear is the locals will be gone as well, what then!

You see CSG wells are self operating and once commissioned, they require periodic inspections and maintenance. They even have wireless monitoring shoukd something fail.

STG as for rents, my suggestion is that mining rents shoukd be levied and these funds used to subsidize locals rents, on a case by case basis.

Then there's the other side, whereby I know of an older gentleman who is renting his three spare rooms out, including three meals a day, for $1000 per week, per room.

Ludwig, as I say, this is not your normal boom.

sonofgloin, I liken the mining issue to that of a pub with pokies. They simply can't survive now without them. Same same for our governments.

Yabby, funny you should mention that, as the council did gift some land to a local developer, but as usual, the 'i's wernt dotted and the 'T's wernt crossed, so the end result is this land is now some of the land that is selling for $200K per lot, yet cost the developer nothing to acquire.

If councils/governments had any brains they would have placed a caveat on the land which could have been removed once they received what was agreed on as reasonable recompense
Posted by rehctub, Sunday, 1 July 2012 1:30:41 PM
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*so the end result is this land is now some of the land that is selling for $200K per lot, yet cost the developer nothing to acquire.*

Well there you go, Rehctub. Either a bit of corruption going on or
just sheer pure stupidity by the council. They could have leased
the land out to the miners for a good rent, to whack some transportables on there for the construction phase, then moved them
on to the next mining project, in a few years time.

It would actually be a great business plan for some company, but no
doubt the local govt red tape would be so great, as to make it virtually
unworkable, no matter how sensible it is.
Posted by Yabby, Sunday, 1 July 2012 1:44:10 PM
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Negative man, Rechtub, such is life.
Why are you concerned about an industry that may well be still going in a hundred years.
And surely you understand those same blocks once sold for 6 pence an acre?
Posted by Belly, Sunday, 1 July 2012 4:57:31 PM
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Belly, I'm not negative about this industry, in fact, I'm a supporter, but not when they effect prime land.

Personally, I have benefitted more than most from it, as I have a pilot program on one of my lots. Nice rent payment and a chance of early retirement for me.

But that doesn't stop me from showing concerns for the towns effected by the boom.

Accommodating the workers is only one problem, it the cost of many things that are the worry, grocerries being the exception.

A spare part for one of my motors cost me about 30% more than it should, why, because this supplier is one who is benefiting from the boom, but many others don't.

We see many businesses trying to employ staff, but they can't cause there is nowhere to live.

Some business owners are trying to place dongers on their land to house staff, but the hoops they have to jump through make it cost prohibitive in many cases.

If you offer someone $25 per hour here, they laugh, as $120K per year, 2 on 2 off is the new norm.

But, as I have said previously, this is not your typical boom, as this influx of workers will be gone in a few years.

Hopefully the locals won't be gone as well, but that's the likely case.

BTW, does anyone remember the $1 land deal from the Jandowie council, aimed at attracting people to town.

Well that's right in the heart of gas land.
Posted by rehctub, Monday, 2 July 2012 7:17:39 AM
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I do not know how closely related Coal Seam Gas is to Shale Seam Gas
and whether similar depletion rates are experienced for both.

However Shale Seam Gas in the US is experiencing depletion rates of 50%
a year. This usually means that a particular well lasts about two years.
This means a company has to keep on drilling all the time with no just
sitting back and selling gas.
The result is that many companies become Ponzi Schemes in always
needing new funds. Many shale gas companies in the US are in financial
trouble with no way out.

Does anyone know the depletion rate of CSG wells ?
If there is any similarity it could mean that they will all be gone
in a few years.
Posted by Bazz, Monday, 2 July 2012 10:32:36 AM
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Bazz, what I have been advised, by industry people, is that the average well lasts for about thirty years. They start drawing from the bottom, stay there for a couple of years, then progressively raise the pump towards the top.

The first few years are usually the most productive.

Then there are companies who use fraking, this process is different again.

Our CSG is contained within the coal seams and is held below by water.

This water is drawn off, stored, then treated prior to release or use.

There are several trials being conducted with the treated water, growing crops.

I have heard that in one case, not sure where, they grew some corn, and while it looked like normal corn, it had no protein content.

Experts put this down to the lack of minerals.
Posted by rehctub, Monday, 2 July 2012 9:31:25 PM
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Rehctub, you mention raising the pump.
Are you talking about oil or gas ?
I did not think they had to pump the gas.

Anyway, I believe it should not be exported. We will live to regret it.
I am surprised that a csg well could go for thirty years.
I imagine it would have to draw gas in from a very large area.
I believe they do not use fracking in csg because it is already fractured.
Posted by Bazz, Tuesday, 3 July 2012 11:55:24 AM
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Baz, the pump is used to draw up the water and the gas follows.

As for the life span, it's only what I have heard.

As for export, I am 100% behind you there, in my view, it has the potential to proved our energy for as long as we need.

however, because we have lost so much industry, and have exported so much of our raw products over the years, where we could have value added instead, we are now so reliant on mining exports, that our world will literally collapse when we either run our of supply, or the demand stops, which ever comes first.

A comforting thought, hey!

As for fraking, some companies do, while others don't.
Posted by rehctub, Tuesday, 3 July 2012 1:46:46 PM
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