Santos' proposed $3 billion coal seam gas project near Narrabri has large information gaps involving its environmental risks, raising concerns from opponents as well as the local mayor.
The company's response to 23,000 submissions to its environmental impact statement released earlier this year offered "no substantial revision or redesign" to its initial report, according to an assessment by Matthew Currell, a senior lecturer at RMIT University's School of Engineering.
"It sort of shocked me the lack of additional data collection and field work," Dr Currell told Fairfax Media.
The release of a separate water baseline report revealed "significantly higher average salinity" of the so-called produced water from the proposed 850 wells. Yet Santos "made little or no attempt" to update the project's design, he said in a report commissioned by EDO NSW.
The project, located near Narrabri in northern NSW, sits within a recharge zone of the Great Artesian Basin. Despite that, the project's design took "no account" of contamination risks to aquifers from the generation, transport and management of a predicted 35 billion litres of wastewater to be produced over its operational life, Dr Currell said.
"The state governments going to see that they really havent done much work since the original EIS and the submissions," he said. "So theres a risk there for [Santos]."
Opponents say they understand NSW Department of Planning has asked for additional information, a move that could add delays to any approval.
A department spokesman declined to comment on any information requests, saying it was "currently assessing" the proposal.
Macquarie Bank analysts cast a cloud over the project on Monday, releasing a report that said alternative plans to bring in gas from overseas would alter energy markets and "could result in the final nail in the coffin" for the venture.
Santos chief executive Kevin Gallagher dismissed the Macquarie report, saying Narrabri's gas "will always be a cheaper source" than gas from an LNG import terminal.
The company also defended its EIS, saying it was based on a groundwater model that the CSIRO reviewed as "state of the art".
"Santos is confident that our EIS will stand up to the highest scrutiny and will abide by the outcome of the rigorous, independent assessment process being carried out by the NSW Department of Planning and the Independent Planning Commission," a spokeswoman said.
Catherine Redding, Narrabri shire mayor, said the council wanted Santos to be clearer "about what's happening with the disposal" of salts produced by the project.
The council, though, is neutral on the venture as a whole, Cr Redding said, adding the company had done a better job at supporting the community than some of the coal mines operating in the region.
Graziers such as Tony Pickard, who has battled Santos for a decade over plans to drill wells within a kilometre of his property, said analysts' reports predicting its demise were likely premature.
"The whole thing's done with smoke and mirrors," Mr Pickard said, adding he expected Santos would aim to secure approvals to proceed and then sell it to another buyer. "The fight's nowhere near over."
Peter Hannam is Environment Editor at The Sydney Morning Herald. He covers broad environmental issues ranging from climate change to renewable energy for Fairfax Media.
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