Santos Ltd’s boss says coal seam gas (CSG) is a crucial way forward to a low carbon economy and many attacking it oppose the resources industry generally.
Greens senators Bob Brown and Christine Milne and singer Olivia Newton-John weren’t named, but are among those who have recently attacked the use of fracking to access CSG.
David Knox, chief executive at the oil and gas major, spoke on Friday while announcing the company had more than doubled first half profit.
Fracking is the process of injecting water or other fluids into cracks in rock to extract gas, which opponents say contaminates water or soil.
Mr Knox said natural gas was at least 50 per cent cleaner than coal and rejected claims from the Greens that CSG was no better for the environment than coal.
“There is a lot of misinformation in the public debate, most of it due to a lack of understanding, some which is deliberately pushed by people who will never support the resources industry,” he told a teleconference.
There have been protests in Sydney this week against coal seam gas mining, involving angry farmers who say that the use of fracking will contaminate prime agricultural land.
However, federal Regional Australia Minister Simon Crean said on Friday that CSG should be supported and Australia could become the “Saudi Arabia of gas”.
Mr Knox insists there had been no effect on shallow groundwater over 14 years of monitoring drilling at Santos’s main CSG field at Fairview in Queensland’s Bowen Basin.
Santos is heavily invested in CSG through the $US16 billion Gladstone Liquefied Natural Gas (GLNG) project it is leading.
It also recently made a $924 million friendly bid for NSW-based coal seam gas firm Eastern Star Gas, which controls NSW’s largest CSG resource.
Natural gas demand is set to more than double by 2020, with Australia one of the world’s biggest exporters and
Santos already Australia’s third largest oil and gas producers and aiming to be an LNG major.
The company posted a first half net profit of $504 million from $198 million a year earlier, as it reaped the benefits of selling down its stake in the GLNG from 60 per cent to 30 per cent.
Underlying profit, excluding the GLNG sale, rose 12 per cent to $236 million.
The company’s shares fell heavily on Friday, along with other energy stocks amid worries about the global economy, closing down 61 cents, or 5.22 per cent, at $11.07.
Santos has stuck to its full year 2011 production guidance of between 47 and 50 million barrels of oil equivalent, despite floods earlier in the year.
UBS analyst Gordon Ramsay described the result as solid and expected, but said it was too early to assess the company’s major projects – including the GLNG and Papua New Guinea (PNG) LNG operations – with first production several years away.
Mr Knox said news on Friday the PNG government would hand ownership of resources to landowners wouldn’t affect Santos, as existing projects wouldn’t be affected.
