Origin Energy

Origin Energy is an Australian energy company headquartered in Sydney. Origin Energy is active in a number of sectors in the energy business, from oil and gas exploration to electricity generation, transport, and retail. The company is also engaged in coal seam gas "fracking."

History
Origin Energy was formed in February 2000 as a result of the demerger of Boral Limited an Australian conglomerate. Boral had interests in energy and building and construction materials. Prior to a demerger in February 2000 the company was known as Boral Limited. The demerger of Boral Limited involved spinning off the building materials business into a separate company and renaming Boral Limited to Origin Energy Limited. The building materials business was then named Boral Limited and was re-listed as a new public company.

Due to Origin having evolved from parts of a conglomerate, the date of inception of the company is difficult to define. Parts of Origin's business can be traced back to the 19th century while Boral limited began in 1946 as Bitumen and Oil Refineries (Australia) Ltd. At the time of the demerger, the largest portion of Origin's assets originated from the acquisition of SAGASCO Holdings Limited, a petroleum exploration, production and gas retailer based in Adelaide, South Australia. SAGASCO's gas retailing business dated back to the 1850s, making it one of Australia's oldest continuously-trading companies.

Boral’s energy interests grew through corporate acquisition and in 1995 were consolidated in the subsidiary company Boral Energy. Further acquisitions were made by Boral Energy before the demerger.

Core business
Origin Energy is active in a number of sectors in the energy business:


 * Oil and gas exploration and production - Origin has conventional oil and gas reserves in the Cooper Basin of South Australia and Queensland and in the Bass strait between Victoria and Tasmania and coalbed methane reserves in Queensland. Outside Australia, Origin is developing the Kupe gas field in the Taranaki Basin of New Zealand
 * Retail - over three million retail customers of gas or electricity in Australia, New Zealand and the south Pacific, inclusive of the 800,000 customers of Sun Retail in QLD that were acquired in February 2007.
 * Generation - generating electricity from natural gas including Osborne, Ladbroke Grove and Quartantine Power Stations in South Australia, Uranquinty in New South Wales, Mount Stuart Power Station in Townsville and Roma Power Station Queensland. Origin does not own any coal-fired power stations.
 * Contact Energy - Origin owns 52% of New Zealand electricity generation and retail company Contact Energy.
 * Gas transportation and distribution - Origin had significant shareholdings in Envestra Limited (17%) and SEAGas pipeline (33%). These shareholdings were sold to APA Group during 2007, along with the assets of Origin Energy Asset Management. OEAM's major asset was its contract with Envestra for the maintenance of the Envestra natural gas distribution network.

Coal seam gas plant
In February 2007, Origin purchased Sun Retail from the Queensland Government and gained development and regulatory approvals for a syngas-fired plant, the Darling Downs Power Station, in the Darling Downs region near Braemar, 40km west of Dalby. The new Darling Downs Power Station will use coal seam gas (CSG) reserves held by Origin in south west Queensland, predominantly in the area around Roma and Chinchilla.

On June 12, 2007, Origin committed to a construction contract worth $780 million over approximately three years to build the 630MW gas-fired power station – the biggest IGCC power station in Australia. Origin has contracted a consortium of GE and CH2M Hill to construct the power station. GE will supply three Frame 9E gas turbines with a capacity of 120MW each and a steam turbine of 270MW capacity. CH2M Hill will undertake engineering and construction activities and supply of the balance of plant. Full commercial operation is expected by the first quarter of 2010. When fully operational the power station will consume about 44PJ of gas per year.

Benzene found near Origin coal seam gas fracking site
In October 2010, farmers near a coal seam gas "fracking" site in Queensland announced that they will have their water supplies tested for toxic benzene and other chemicals after Origin Energy found contaminated water near drilling sites. The discovery of BTEX - a mixture of benzene, toluene, ethylbenzene and xylene - around eight coal seam gas wells near Miles, west of Brisbane, marks the first time a resources company has admitted to contaminating water at a fracking site. Origin detected the chemicals in mid-October and told the Queensland government, which is legislating to ban the use of BTEX chemicals during coal seam gas drilling. Origin has shut down all 17 of its drilling rigs across a 40-kilometre-wide area while an investigation is carried out.

Fracking, or hydraulic fracturing, involves injecting water, sand and chemicals underground to fracture rock formations and force gas to the surface. The controversial process has fuelled protests from landholders in Australia and the United States, where government tests have detected harmful levels of hydrocarbons, including BTEX, in drinking water wells in areas where fracking is used. Origin refused to disclose the mixture of chemicals used in the fracking fluid that it was using on the site. The US company Halliburton supplied the fluids. Origin's manager of oil and gas operations, Paul Zealand, said BTEX was not being used as a fracking fluid, and that the contamination may have come from diesel fuel or lubricants used on machinery at the gas drilling sites. An engineering consultancy, URS, and the government will investigate.

Directors
Accessed March 2008:


 * H Kevin McCann - Independent Non-executive Chairman
 * Grant A. King - Managing Director
 * Bruce G. Beeren
 * Trevor Bourne
 * Helen M. Nugent
 * Roland Williams
 * Gordon M. Cairns

Contact

 * Web: http://www.originenergy.com.au

Related Sourcewatch articles

 * Asia Pacific Partnership on Clean Development and Climate
 * Australian Conservation Foundation
 * Australian Industry Greenhouse Network
 * Colin Carter
 * Tony Berg
 * Andrew Stock