Govt demands financial assurance to cover CSG land damage

REPAIRING land used by the coal seam gas industry in Queensland could eventually top more than $600 million, as the state holds on to a giant pool of cash to ensure sites are cleaned up.

The figure comes from the Queensland Government, which demands a financial assurance - similar in concept to a bond on a rental home - to cover any damage left behind once operations are exhausted.

The gas industry has so far paid $620 million to the Queensland Government based on operations and infrastructure planned or in use across the state.

If this amount was applied just to the 3956 gas wells operating in Queensland at the end of 2012, it would add up to $156,723 per well.

The government expects more than 14,000 wells to be in use by 2020.

Long-distance pipelines will connect these wells in south-west and Central Queensland to three multi-billion dollar factories off Gladstone, which will then covert the CSG to liquefied natural gas for export.

Queensland Government figures also revealed the three major CSG to LNG plants being built on Curtis Island - the Gladstone, Australia Pacific and Queensland Curtis LNG projects - had paid a combined total of $41 million.Once land rehabilitation is finished and approved by the State, the cash is refunded.

But CSG opponents said there was too little knowledge about potential CSG risks to be confident enough in a dollar amount.

Queensland Greens Senator Larissa Waters said it was unclear if any amount of money could repair environmental damage potentially inflicted by gas companies.

"We don't know if aquifers (underground water channels) can be re-pressurised and restored, let alone how much money it would cost to do this," Ms Waters said.

"Coal seam gas could end up costing future generations far more than the government is charging mining magnates."

A spokesman for Origin's APLNG development said sites would be rehabilitated on a "rolling basis" - those exhausted wells to be replaced by new sites.

He said any environmental incident would be addressed separately from the rehabilitation fund.

Gas giant Santos - currently spending $20 billion to build the GLNG gas plant off Gladstone - described the amount paid to government as "appropriate".