Northern rivers resident Michael Qualman has launched a complaint with ASIC over claims by gas explorer Metgasco that it enjoys a high level of support for its activity in the region and that activism has not materially impacted on its business.
Mr Qualman accuses the company and CEO Peter Henderson of ‘misleading and deceptive communications to the stock exchange’ and ‘ongoing breach of its continuous disclosure obligations under both the ASX listing rules and the Corporations law’.
In his letter outlining the complaint, Mr Qualman says, ‘the matter revolves around ongoing failure by Metgasco to provide the market with accurate information regarding the level of community opposition to its gas field development proposals in the northern rivers’.
‘The issue of public opposition is material and relevant due to the fact that Metgasco is almost entirely reliant on eventual access to gas reserves situated in the northern rivers for the viability of the company,’ the letter continues.
‘Very reliable and robust data is available to Metgasco quantifying community opposition/support could and should be shared by Metgasco with the market.
‘However, Metgasco continues to suppress any mention of the full range of data, and continues to rely on a single push poll of highly questionable veracity in their disclosures.’
In February, Mr Qualman was himself the target of a complaint to ASIC by Metgasco, after he wrote letters to some Metgasco shareholders saying that the company had been understating the scale of public opposition and that the regional community was well organised and had undertaken training in non-violent direct action.
The company also accused Mr Qualman of unauthorised access to its shareholder records, an allegation he denies, saying he wrote to just 21 of the largest shareholders, all of whose names were available for public scrutiny in the company’s annual report.
Push poll quoted
The dispute around the figures arises because of three existing sources of data for assessing the scale of local opposition to the industry. One is the Lismore council poll in 2012, another is university research conducted in November 2013 and the third is a small push poll survey conducted by the Richmond Valley Council.
In a media release issued by Metgasco at the time, the company denied that more than of 90 per cent of local people were opposed to gas exploration (based on the other two surveys) relying instead on the 2012 Richmond Valley Council’s push-poll, which found that 70 per cent supported gas mining ‘provided that it was safe and environmentally sound’.
According to Mr Qualman, ‘it’s very hard for Metgasco to get out of this one, as the AEC and university data is clear and to continue to ignore it in favour of a very dodgy push poll is misleading, even if it’s technically true that the push poll produced the figure quoted.
‘The reason why the law focuses upon “misleading” rather than “untrue” is because it is about the impression created rather than whether the statement is merely technically supportable,’ he said.
‘By continually failing to mention the more reliable data to the market Metgasco may be creating a false impression that they have adequate community support,’ he added
Impact of activism
Metgasco also disputed Mr Qualman’s claims that anti-gas activists were hurting the company’s prospects, saying it paused its activity in the northern rivers entirely due to concerns about changes in government policy.
But two letters sent to five state government ministers last year by Metgasco CEO Peter Henderson, which were released to the media this week, would appear to disprove that claim.
In the first letter, dated January 23 2013, Mr Henderson wrote, ‘exploration activity of all kinds will come to a stop in NSW if companies who have valid and government-approved work programs can have their legitimate activities sabotaged by activists who see themselves as being above the law’.
‘We request your support not only through police action but also through mandatory sentencing of those who are found guilty of breaking the law.’
Again on February 6, Mr Henderson wrote to the ministers, including then energy minister Chris Hartcher (who is currently being investigated by ICAC), planning minister Brad Hazzard, police minister Michael Gallacher and attorney-general Greg Smith.
In this second letter Mr Henderson requested ‘a permanent police presence at our northern rivers drilling sites…’
In concluding this letter he wrote, ‘the consequences of Metgasco having to suspend its current operation in response to a small, unruly opposition group would be devastating to resource development and energy supply in NSW.’
The revelations come despite Metgasco having said in its ASX release attacking Mr Qualman that protest actions did not substantially disrupt their operations.
‘Metgasco cannot have it both ways,’ Mr Qulaman said.
‘They can’t say one thing in private to the government and another in public to the share market. They have clear duties of disclosure on these matters, they are required by law to tell investors the full story.’