Call for Royal Commission into CSG licences

Chris Dobney

Farmers and local anti-gas groups have welcomed moves by the state government to place a moratorium on CSG exploration licences and raise the cost of the licences to $50,000. But many say it does not go far enough.

Lock the Gate spokesperson Ian Gaillard has called for a Royal Commission into the granting of licences and the cumulative impact of onshore gas exploration and exploitation.

The government said yesterday it would not release any new licences for six months and would audit all existing licences.

New energy minister Anthony Roberts said the NSW government would freeze processing new PELAs until September 26 as it puts in place a more comprehensive application process.

‘Speculators or cowboys need not apply,’ he added

The move follows the refusal of an exploration licence to two-dollar company Grainger Energy in the Riverina earlier this week.

Mr Roberts wasted no time in dressing down Grainer Energy and its owner/manager Vaughan Cullen.

‘Grainger Energy has one owner/director, was formed just six days prior to lodging its application, has no history of conducting petroleum exploration activities and has submitted a manifestly deficient application.

Royal Commission

The move prompted Lock the Gate’s Ian Gaillard to call for a Royal Commission into ‘all aspects of the granting of licences for unconventional gas’.

‘Some of the things that a Royal Commission should examine are all drilling records and incidences of environmental damage, and a far-reaching examination of cumulative impacts by scientists appointed by the community in affected areas,’ he told Echonetdaily.

‘The lottery of election fever needs to be tempered with a truly long-term view of cumulative impact of gasfields in inappropriate areas.

‘Any political party seeking election needs to consider that this is a broad social movement and be put on notice that remedies to get them elected on these issues will not wash with the broader community.’

Put industry on hold

Lock the Gate’s Boudicca Cerese was more conciliatory, welcoming the review of but saying it was not clear what the scope of it would be.

She said this morning the decision was ‘an acknowledgment from government that the current system of licences is failing and needs to be overhauled, which is what the community has been saying all along – that many of these licences should just never have been granted’.

‘The government media release seemed to suggest it would be just looking at the operators – the applicants for the licences,’ Ms Cerese said.

She added that it was imperative that the government place a moratorium on exploratory drilling by existing licence-holders during the investigation.

‘You need to put the whole industry on hold and do a full inquiry into the impact and decide once and for all whether the industry should go ahead at all, and in what areas,’ she told Echonetdaily this morning.

‘Operations in Pilliga, Gloucester and the northern rivers should all be put on hold,’ Ms Cerese said.

‘Any system has to include areas that are no-go zones, such as important food-growing areas, water-supply areas and high-conservation-value land,’ she told Echonetdaily.

She added that ‘any changes to the Petroleum (Onshore) Act need to ensure the right of the landholder to say no to access to their land for gas operations’.

She also called for tougher regulatory frameworks, citing a series of breaches by Metgasco including failing linings on wastewater ponds, the unlicensed dumping of wastewater into the Casino sewerage system and the accident during the decommissioning of its Kingfisher well.

NSW Farmers Association president Fiona Simpson welcomed the move and said it had only taken place because of a change of minister after former energy minister, Chris Hartcher, was referred to the Independent Commission Against Corruption.

‘The new minister’s coming into the position with a fresh pair of eyes has enabled him to meet with the stakeholders and to understand the positions that we hold,’ she told ABC radio this morning.

‘Certainly we have very much appreciated being able to talk to the minister about many of our concerns.’

Shonky operators

The government has also issued a ‘show cause’ notice to Leichhardt Resources as to why its three PELs near Moree, across Nowra and between Bylong and Denham, should not be cancelled.

Premier Barry O’Farrell said the former Labor government granted 39 exploration licences while his government had yet to grant a single one.

He pointed out that three-quarters of the licences granted under Labor were issued by former ministers Eddie Obeid and Ian Macdonald, who were later found by the Independent Commission Against Corruption to have acted corruptly.

He accused the former Labor government of granting licences ‘like confetti’ and allowing exploration ‘from Palm Beach to Cronulla and from Bondi Junction to St Marys’.

‘We’re taking decisive action to ensure the state’s resources are developed for the people of NSW and not for the benefit of Labor MPs, their cronies and their union mates,’ he told Parliament.

Mr Roberts said under the Petroleum (Onshore) Act (1991), a petroleum title may be cancelled on a number of grounds, including contravention of conditions and failure to use the title area in good faith for the purpose for which the title was granted and for contraventions of the Act.

‘The NSW government will not rule out rejecting further PELAs or cancelling PELs,’ he said.

‘It is clear that the PEL application process under the former Labor government was not up to scratch.

‘In 2002 NSW Labor introduced a PEL application fee of just $1,000.

‘The proponent could then hold a PEL across a large area of land, which placed unnecessary and understandable stress across communities.

‘In fact, the former Labor government granted a PEL that blankets Sydney from near Wollongong to the central coast for an application fee of just $1,000.

– with AAP