Anti-gas activists and the Australian Greens have expressed alarm at the lack of insurance taken out by petroleum mining companies to cover mishaps.
They argue the best insurance is to scrap the industry altogether and concentrate on renewable energy.
NSW chief scientist Mary O’Kane has released a report calling for stricter insurance requirements to guard against possible environmental damage caused by the emerging coal seam gas industry.
She has also recommended the NSW Government consider establishing an environmental rehabilitation fund to address unforeseen or long-term environmental impacts and remediation.
‘CSG extraction is a relatively new industry in NSW and it is one that is largely under-protected,’ Professor O’Kane said.
‘There is no standard approach to insurance coverage within the CSG industry, and the take-up of coverage by operators is uneven at best.
‘There is also presently no mechanism to address unforeseen and/or long-term environmental impacts attributed to gas extraction – and that is why I have recommended the government consider establishing an environmental rehabilitation fund, similar to that set up by the WA government for its mining industry,’ she said.
Lock the Gate campaign coordinator Carmel Flint said the failure of CSG companies to take-out adequate insurance was further evidence of how they failed as good corporate citizens.
‘In the event of a major catastrophe or even a relatively minor leak the taxpayer could be the one left having to foot the bill for rehabilitation or decontamination,’ Ms Flint said.
‘This is yet another example of how the CSG industry thinks it is above the law and can do what it likes with our environment and our health.
‘This industry cannot even be bothered to cover itself for a mishap, instead expecting the community to clean up any mess.
‘Adequate insurance should be a minimum requirement before any CSG permits are granted or even accepted for consideration,’ she said.
The Greens NSW mining spokesperson Jeremy Buckingham said the best form of insurance on coal seam gas (CSG) was for the industry to not go ahead.
‘The Greens welcome the chief scientist’s recognition of the broad range of risks associated with the coal seam gas industry, however we believe the best way to deal with these risks is to avoid having a coal seam gas industry at all. Instead we should transition to renewable energy,’ he said.
‘While some risks associated CSG may have a low likelihood of occurring, the impact of an occurrence may be extremely high.
‘Developing thousands of gas wells increases the chance of even unlikely events occurring.
‘Other risks may be cumulative and gradual, but substantial – something that is not covered by the current insurance regime.
‘The Greens have long campaigned for the establishment of an environmental rehabilitation fund, similar to that recommended by the chief scientist, which would apply to the whole mining sector and partially address the costs associated with long-term environmental impacts and remediation,’ he said.
Mr Buckingham has a private members bill before the NSW Parliament, the Responsible Mining (Protecting Land, Water and Communities) Bill.
If passed, it will establish an environmental rehabilitation fund and a responsible framework that addresses community concerns and protects valuable land and water.