Domestic and industrial use of gas has been synonymous with rising living standards and the development of South Australia since 1861 when the South Australian Gas Co. was incorporated by legislation. Under its chairman, Henry Ayers, the company pioneered coal-gas manufacture in the colony. Gas produced in a coal-fired gas works at Brompton was used initially for lighting, with the first Adelaide streets being lit in 1865.

Gas works were also built beyond Adelaide, the Provincial Gas Co. of South Australia, formed in 1868 to provide gas for major country towns, supplying Kapunda in the Mid North in November 1869 and Strathalbyn on the Fleurieu Peninsula the following December.

From 1870 gas supply gradually spread throughout the suburbs. New gas works at Glenelg began production in 1875 while the South Australian Gas Co. acquired the Provincial Gas Co. in 1877 and rationalised the Adelaide and suburban supplies. The SA Gas Co. responded to competition from electric lighting from 1897 by promoting the sale of gas appliances, initiating cooking demonstrations in 1902.

SA Gas Co. remained hard pressed to meet increased demand, especially while the manufacture of gas relied on New South Wales coal. The disruption of coal supplies during the First World War prompted the rationalisation of both country and metropolitan operations. Strikes on the New South Wales coalfields immediately after the Second World War led to severe restrictions on gas – and electricity – supplies from 1945 to early 1947, prompting the installation of carburetted water gas plants at Osborne and Brompton in 1947 to diminish the reliance on coal from New South Wales. A catalytic reforming plant was commissioned at the Brompton gas works in June 1964 and gas manufacture from coal ceased there in 1965.

Meanwhile, the SA Gas Co., familiarly known as SAGASCO after the war, had become truly South Australian when it began marketing Liquefied Petroleum Gas during the 1950s. The nature of the industry changed radically following the discovery of major natural gas reserves in the Cooper Basin in the Far North. A decision in 1965 to convert the Electricity Trust of South Australia’s proposed Torrens Island Power Station from oil to gas provided a market in Adelaide large enough to justify the cost of pipeline construction. The Pipelines Authority of South Australia was established in 1967, the Moomba–Adelaide pipeline completed in 1969 and a spur pipeline to Port Pirie opened in June 1976. The manufacture of gas ceased at Osborne in 1979; SAGASCO had become simply a supplier of natural gas.

From 1976 natural gas was piped to the Sydney market, ensuring continued exploration in the Cooper Basin for additional gas reserves to supply the Adelaide market. The $1.5 billion Cooper Basin Liquids Project was opened in 1983, with a new port (Port Bonython) and processing facilities established near Whyalla. A subsequent pipeline connected the Moomba operation with southwest Queensland gasfields. The Cooper Basin has become Australia’s largest onshore producer of oil and gas.

The Otway Basin in the South East is the state’s second most-explored region for oil and gas. Operating near Alfred Flat on the Coorong by the Salt Creek Petroleum Oil Prospecting Co. between 1881 and 1883 marked the first systematic attempt to drill for oil in Australia. Further southeast, between 1912 and 1930 the South Australian Oil Exploration Co. drilled several shallow wells. However, only since the discovery of carbon dioxide at Caroline near Mount Gambier in 1966 (with commercial production commencing in 1969) have the long-held hopes for the region been realised. Ultramar Australia’s Katnook 1 well near Penola revealed the South East’s first significant natural gas flow in December 1987. As well as carrying domestic gas to Mount Gambier and supplying existing markets, SAGASCO sought new industries. A gas-processing plant was commissioned at Katnook in April 1991. Subsequent government sell-offs and commercial takeovers notwithstanding, on a smaller and more localised scale the South East is poised for further development of its onshore, and possibly offshore, oil and gas potential.