**Abstract**

Government are challenged to deploy trustworthy regulation to enable profitable and envi‐ ronmentally sustainable unconventional petroleum projects. A key activity under scrutiny during the development of these projects is hydraulic fracture stimulation. Regulatory 'Nir‐ vana' for unconventional projects and conventional projects alike entails:


**•** Licensees monitor and report on the efficacy of their risk management, and the regulator probes same;

**•** People and organisations potentially affected by unconventional gas operations have justifiablyexpressedconcerns forpreservingsocial,naturalandeconomicenvironments;and **•** Governments have made strides to refine regulatory and investment settings to simultane‐

Regulatory Nirvana for Hydraulic Fracture Stimulation

http://dx.doi.org/10.5772/56381

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In this regard, October 2010, the South Australian Government's Department for Manufac‐ turing, Innovation, Trade, Resources and Energy (DMITRE) initiated a consultative group to inform how unconventional gas projects could be undertaken the most sustainably and efficiently, considering the social, environmental and economic impacts and benefits. This group – the Roundtable for Unconventional Gas Projects in South Australia (Roundtable) – played a critical role, informing our Roadmap for Unconventional Gas Projects in South Australia (Roadmap) [2]. As of January 2013, the Roundtable had 230 members including peak representative bodies, companies, universities, media outlets, individuals and key govern‐ ment agencies from all the states, the Northern Territory and the Commonwealth govern‐ ments. This paper summarises the findings of this Roadmap that relate to world leading practices for the regulation of the development of unconventional petroleum resources that

The Roadmap for Unconventional Gas Projects in South Australia [2] was developed to provide timely, credible information to people, communities and markets, outlining potential risks and rewards associated with unconventional gas projects. It sets the course for the environmentally sustainable development of South Australia's large endowment of uncon‐ ventional gas, and encourages safe exploration and production under this State's robust and effective regulatory framework, the PGE Act. The Roadmap helps to ensure people and enterprises potentially affected by unconventional gas projects understand the regulatory framework, the transparent environmental assessment and activity approval processes; and how they will be consulted, so their rights to object in part or in full are supported. The Roundtable also identifies 125 recommendations which cover the life cycle of unconventional gas projects – from exploration to production and possible liquefied natural gas exports, as well as related supply chains and infrastructure matters. Roundtable working groups have

To comment on and further inform the implementation of the 125 recommendations posed in the Roadmap or to enquire regarding participation in the Roundtable for Unconventional Gas Projects in South Australia – readers are asked to contact dmitre.petroleum@sa.gov.au.

Onshore petroleum exploration and development activities in South Australia are adminis‐ tered by DMITRE under the South Australian PGE Act. The PGE Act has a number of aspects

**3. Regulation to enable hydraulic fracture stimulation in the public's**

ously satisfy both community and investor expectations for net outcomes.

rely on hydraulic fracture stimulation to attain economic flow rates.

reconvened to develop plans to implement these recommendations.

**interest — The South Australian approach**

**2. The Roadmap**


These principles are deployed in South Australia where:


Since implementing South Australia's *Petroleum and Geothermal Energy Act 2000* [1] *(*PGE Act), more than 11,000 notices of entry for petroleum operations led to just one court action, and that was to establish a legal precedent that geophysical surveys can extend outside a li‐ cence to enable a complete understanding of the potential resources within a licence.

The introduction of new energy development technologies is inevitable, so regulatory Nir‐ vana requires adaptive learning so that the previously mentioned principles are maintained. Expeditious, welcomed access to land for compatible, multiple uses is the metric for per‐ formance, and leading practice is based on the principle that trust is the most valuable lead factor and lag outcome in sustaining land access for resource exploration, development and production.

### **1. Introduction**

The Australian oil and gas industry has contributed greatly to the economic prosperity and quality of life of our communities for decades to date. An opportunity to prolong and expand welcomed contributions in a golden age of unconventional gas is arising. The challenges ahead of a prospective golden age of unconventional gas are many, and include getting regulation and operations right. Results that consistently, simultaneously meet community and investor expectations for social, environmental and economic outcomes will deliver trust in land access and investment – and create a virtuous lifecycle for the upstream petroleum sector for decades to come.

Coal seam methane was Australia's first unconventional gas play to be commercialised and reserves will underpin LNG exports from Gladstone, Queensland. In October 2012, the tap was turned on the first domestic commercial use of shale gas from Moomba 191 in the Cooper Basin – another milestone on the road to develop a variety of unconventional gas resources across Australia. Foreseeing the potential scope of development of unconventional gas resources:

**•** Companies have shifted budgets to explore, appraise and develop unconventional gas plays;


In this regard, October 2010, the South Australian Government's Department for Manufac‐ turing, Innovation, Trade, Resources and Energy (DMITRE) initiated a consultative group to inform how unconventional gas projects could be undertaken the most sustainably and efficiently, considering the social, environmental and economic impacts and benefits. This group – the Roundtable for Unconventional Gas Projects in South Australia (Roundtable) – played a critical role, informing our Roadmap for Unconventional Gas Projects in South Australia (Roadmap) [2]. As of January 2013, the Roundtable had 230 members including peak representative bodies, companies, universities, media outlets, individuals and key govern‐ ment agencies from all the states, the Northern Territory and the Commonwealth govern‐ ments. This paper summarises the findings of this Roadmap that relate to world leading practices for the regulation of the development of unconventional petroleum resources that rely on hydraulic fracture stimulation to attain economic flow rates.
