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In the lead up to the AWA’s Ozwater ‘15 Expo in May, two of Australia’s biggest resources companies, Rio Tinto and Santos, present case studies on innovative water management in resources.

Water management is an ever-present challenge for the minerals and extractives industries in Australia. A secure and reliable supply of clean water is vital to mineral processing, gas extraction and mine site safety, not to mention the hydration needs of a thirsty on-site workforce.

However in a large, dry continent like Australia, competition for water is strong. The agricultural sector, other industry, manufacturing and urban areas all vie for a larger cut of their water allocation.

Santos-GLNG's-Andrew-SnarsIncreasing competition for water requires that the mining industry demonstrate the value of its water use, and that it is approaching the management of water responsibly. Especially when the sector is portrayed in certain sections of the media as taking water away from struggling farmers, and in some cases, harming the integrity of local waterways.

At the Australian Water Association convention last year, Mike Harold, Principal Advisor – Water Policy from Rio Tinto Iron Ore made the following key points:

The minerals sector:

  • uses less than 4% of national water resources, but can be a significant water user at a local or regional level.
  • generates a very high economic value-add from the water it uses, many times that of other industry sectors.
  • uses a wide variety of water sources
  • invests heavily in exploration, access, management systems, recovery, recycling and beneficial use and re-use of waters.
  • is a ‘temporary’ user.

MarandooEfficient and responsible management of water, including recycling and the treatment of poor quality water, is increasingly becoming a top priority for resources companies, as they look to maintain costs and preserve their social license to operate.

The extractive minerals sector is not the only one facing these problems. The burgeoning natural gas industry is particularly vulnerable to attacks by activists over responsible management of underground water aquifers.

In a report prepared for the Australian Water Association by Deloitte late last year, 70% of respondents think that unconventional gas has a “significant to moderate effect on the overall management of ground or surface water.”

Of respondents in the key gas-rich states of Queensland and New South Wales, 87% think that unconventional gas poses a risk to water resources, with 74% considering this risk as significant or moderate. Sixteen per cent of all respondents stated that they didn’t know if unconventional gas was a risk to the overall management of ground and surface water, with the highest level of uncertainty in Victoria with 26%.

With public perception skewed against resources companies and their water management credentials, it falls to the industry to adopt smarter innovative systems and to get the most out of their allocation with minimal impact on the environment.

And, if you can cleverly use that allocation to, in fact, enhance the environment, so much the better.

There are a number of resources companies in this country that have recognised the benefits of value-adding their water allocation, and getting in front of community expectations. By going the extra mile and demonstrating real innovation and a thoughtful approach to their environmental responsibilities, some companies are making real headway in restructuring their public image.

HAP-from-the-airCASE STUDY 1
Coal Seam Gas in the Surat Basin

The amount of water produced in the production of natural gas from coal seams changes over time and varies by location.

In general, coal seam gas extraction activities need to withdraw water so that the gas can flow out. Water produced from a well will generally decline as the gas starts to be released from the coal seams.

Santos GLNG expects to produce about 200 gigalitres of water over the next 25 years from their currently approved Surat and Southern Bowen Basin wells, with peak production of about 48 million litres per day around 2019.

Santos GLNG has a comprehensive strategy in place to manage water produced from coal seams, and to monitor surface and groundwater in its areas of operation. Coal seam water is a valuable resource that has the potential to be beneficially reused and the company is working on a number of water reuse projects in consultation with communities and landholders.

Santos’ water re-use projects have been primarily designed to be a practical, working demonstration of how gas companies, agriculture and grazing can co-exist. The company is actively working in partnership with landowners on the gasfields and together they are developing water management models for the benefit of other landowners in the area.

Current projects & initiatives
Fairview Irrigation Project

Santos GLNG has established an Australia-first large-scale water irrigation project at its Fairview and Springwater stations near Injune in Queensland.

It involves spray irrigating forage crops and drip irrigating native tree species, mainly Chinchilla White Gums, with treated coal seam water.

The irrigation has been used successfully to establish more than 350 hectares of leucaena stands, which produce high quality forage. This forage helps Santos GLNG value-add to its own cattle operations, which it runs on the properties it has purchased to locate major gas processing infrastructure.

With ever-changing water volumes available for irrigation, the leucaena stand is an important value-add to Santos GLNG’s beef enterprise.

In addition, the irrigation has supported Santos GLNG’s work to plant more than one million Chinchilla White Gums that can produce up to 200 poles per hectare, with an estimated 6,500 tonnes of carbon absorbed from the atmosphere each year.

This project was used to develop a best practice approach for using coal seam water for irrigation.

Mount Hope Station Pilot Project

Santos is using coal seam water to irrigate forage crops and ultimately enhance farming production on a private landholder’s property.

The company has installed a pivot irrigation system to cover 72 hectares of farming land for irrigation of forage crops. The irrigation system is complemented by an ongoing best practice water and soil monitoring program.

Santos-GLNG-has-planted-more-than-one-million-Chinchilla-White-Gums-and-more-than-350-hectares-of-leucaena,-thriving-on-water-produced-from-coal-seamsPastoral Operations

Santos GLNG has established pastoral operations on the properties it owns in the Fairview and Wallumbilla gas fields, situated in Queensland to the north and east of Roma, and in the Arcadia Valley.

The properties cover a total of more than 40,000 hectares and are safely and sustainably managed by Santos’ Land & Resource team using best property management practices.

The properties primarily produce beef cattle, with a quality Droughtmaster breeding herd comprising about 1,500 cows. Numbers may fluctuate depending on the seasons from around 2,000 head to 4,000 head.

The young cattle are kept for between 12 to 24 months, and replacement animals are sourced from Santos GLNG’s own stock to maintain a quality herd. The team targets the feeder market and may fatten when seasons allow.

One-of-Santos-GLNG's-reverse-osmosis-plants,-where-water-is-treated-for-beneficial-reuse-aCASE STUDY 2
Rio Tinto’s Marandoo mine

Following is an updated extract from ‘Development of Beneficial Use Solutions For Surplus Water From Marandoo Mine: Lessons Learned’, by Garrick Field, Mike Harold from Rio Tino Iron Ore. Reprinted with kind permission.

By volume Rio Tinto is the second largest manager of water in Western Australia (behind Water Corporation)

Water is critical for Rio Tinto’s operations – used in:

  • processing/ore conditioning
  • dust suppression and construction
  • supply to towns and mining camps and villages
  • surplus water management to enable BWT mining.

Rio Tinto’s iron ore operations in the Pilbara source the majority of its water needs through self-supply, and performs all activities relating to development of the resource from aquifer to tap.

The development of an integrated water supply scheme to manage dewatering surplus from Rio Tinto’s Marandoo Phase 2 mine expansion has been a key enabler for development of below water table iron ore resources in an environmentally sensitive location. This solution seeks to maximise the value of the water resource for positive economic, social and environmental outcomes.

Development of below water table iron ore deposits is increasing in the Pilbara as high-quality, above water table iron ore resources are depleted. However, continuous discharge to nearby water courses in the Pilbara is increasingly seen as inappropriate for ephemeral environments like the Pilbara, irrespective of water quality. There is an increasing expectation that mining companies will demonstrate stewardship of water resources to secure environmental approvals and maintain the social licence to operate.

The Marandoo iron ore mine is located approximately 45 km east of Tom Price, adjacent to Karijini National Park in the Pilbara region of Western Australia.

The Rio Tinto iron ore group has developed a unique integrated surplus water management solution to enable the below water table expansion of this project. This solution provides a number of uses for surplus water generated by dewatering activities that will have environmental, social and economic benefits for the local region.

The integrated water management scheme comprises the following components:

  • supply to the Marandoo mine operations and accommodation village
  • supply to Tom Price town and mine
  • a proposal to reinject into the aquifer accessed by the Southern Fortescue Borefield
  • the Hamersley Agriculture Project (HAP), consisting of an irrigated agriculture scheme using centre pivot irrigators on Rio Tinto’s Hamersley Station to grow hay an environmental approval for limited contingency discharge to a nearby creek.

High quality water from Marandoo is used to substitute potable supply to Tom Price town and supply to Tom Price mine, enabling the existing water supply borefield and aquifer to recover following 40 years of continuous use.

The Hamersley Agriculture Project (HAP) is critical to this scheme. HAP is using surplus water from the Marandoo mine to grow Rhodes grass (Chloris gayana) and oats on nearby Hamersley Station under a pivot irrigation system. Hamersley Station is owned and operated by Rio Tinto. The harvested grass provides hay fodder for cattle, predominantly for Rio Tinto’s own pastoral operations, but with some surplus available for other pastoral operations in the region.

The Marandoo integrated water supply scheme also has broader benefits to the region. These include:

  • Replacing the supply to Tom Price town and mine with good quality water from dewatering activities, which enables abstraction from the Southern Fortescue Borefield to cease and natural recovery to occur.
  • The option to artificially replenish the Southern Fortescue Borefield aquifer through reinjection.
  • Increasing the viability of Rio Tinto’s pastoral operations as well as other pastoral properties in the region by increasing regional fodder production and providing a more sustainable provision for drought proofing their operations.
  • The HAP scheme also demonstrates the potential for economic diversity and regional development in a region that is heavily reliant on mining.
  • Avoiding the need to import feed from other regions, reducing the costs and environmental impacts of long haul transport of fodder, including a reduction of greenhouse gas emissions from this transport.
  • Reducing grazing pressure on sensitive rangelands areas, improving the biodiversity and overall health of these areas without impacting cattle production on pastoral properties.

Rio Tinto’s development of the integrated surplus water management scheme to enable the below water table expansion of the Marandoo iron ore mine has highlighted a number of key lessons for future beneficial use schemes. These lessons include:

  • Integrating beneficial uses of surplus water with mine operations requires increased awareness of water-related business risks, opportunities and priorities, and preparedness to consider a broad range of options available to facilitate project development.
  • Resources dedicated to strategic water issues facilitate the development of innovative, forward-looking solutions.
  • Water must be integrated into the day to day management and planning of the operation, with clear accountabilities to address all risks.
  • Retaining control of demand centres optimises the ability to react and respond to changes in water supply volumes.
  • Early proactive engagement on innovative water projects enables a better understanding in government and the wider community of opportunities and limitations facing the proponent, and can inform positive policy change.

The use of mine dewatering surplus to grow crops is, in Western Australia, a new concept. Rio Tinto has worked closely with key regulators and other agencies to research the viability of utilising surplus mine dewater for irrigated agriculture, understanding the unique regulatory challenges arising from a project that crosses multiple government portfolio areas, and negotiating complex approvals paths.

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