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Production - Energy Information Australia

If exploration is successful and oil or gas is discovered, a wellhead is placed on the surface to maintain control of the well and the well is pressure-tested to ensure that it is safe.

The wellhead contains barriers, valves, seals, and a gas/water separator. It allows the pressure of the well and the flow of fluids to be controlled at the surface.

There are four different types of gas and gas wells:

  • Conventional gas

    Conventional gas is found in porous sandstone formations capped by impermeable rock and often trapped at high pressure. The gas can generally move to the surface through the gas wells without the need to pump. The depth of conventional gas reservoirs is usually ~2,000m below ground.

  • Shale gas

    Shales are fine-grained sedimentary rocks, formed from the compaction of silt and mud. Gas can become trapped amongst the shale, which means it requires hydraulic fracture stimulation (or fracking) to open tiny cracks in the target rock reservoir and increase the flow of the gas to a well. Shale gas is usually found at a depth of ~4,000m below ground.

  • Tight gas

    ‘Tight’ rocks are typically limestone and sandstone. ‘Tight’ rocks have very low levels of permeability and are found at ~3,000 below ground. Tight gas also requires hydraulic fracturing to release the gas.

  • Coal seam gas

    Coal is a sedimentary rock from the compressed remains of organic material such as plants, similar to oil and gas. Coal seams store both water and gas, so when a well is drilled the water and gas are pumped out. Coal seam gas reserves are generally shallower than other natural gas reserves, being found at ~1,000m below the ground.

Types of gas wells

If sufficient volumes of oil or gas are found, the well can be connected to a pipeline so that petroleum can be transported to markets and refineries. This may require building a new pipeline or connecting the well to an existing pipeline.

Oil is generally piped to a refinery for processing into more useful products such as petrol, diesel fuel, liquefied petroleum gas (LPG), heating oil, kerosene and asphalt base. But it can also be piped to a shipping terminal for shipment to an Australian or overseas refinery.

If the natural gas is bound for the export market, it must be first cooled in an LNG plant to turn it into a much denser liquid and then loaded on to ships to be transported to customers overseas.

Read more about production by clicking on the links below.

Hydraulic fracturing

The hydraulic fracturing process – also referred to as ‘fraccing’ or ‘fracking’ – is used to increase the flow of oil and gas to a well, increasing production and reducing the total number of wells needed to develop a resource. It allows commercialisation of low permeability reservoirs in which oil and gas do not easily flow.


Environmental management

The Australian oil and gas industry has a strong commitment to high environmental standards and minimising environmental impacts.

In addition to the mandatory regulatory requirements for offshore operations and across onshore all states and territories in Australia, many oil and gas companies commit themselves to voluntary codes of practice to reinforce the industry’s commitment to the safe and environmentally responsible extraction of oil and gas resources.