5AA with Leon Byner

Subjects: coal seam gas mining.

Transcript, E&OE

16 August 2011

LEON BYNER: We appear to have a bit of rivalry: coal seam gas exploration on arable land versus food supply. This is what Tony Abbott had to say recently.

TONY ABBOTT: [Recording] The mining industry is very important and we've got to broadly support the mining industry, but mining shouldn't be allowed to destroy prime agricultural land.

BYNER: All right. Let's talk to Trade Minister Craig Emerson. Craig, thank you for being on the show today.

Do you agree with what Tony Abbott had to say? And, if not, why not?

CRAIG EMERSON: I agree with that particular statement that mining shouldn't be allowed to destroy prime agricultural land. I don't agree with his other statement and that is that landholders should have a blanket right of veto over mineral exploration in this country, particularly coal seam gas exploration.

BYNER: All right. Let's just take a hypothetical here. Let's say you've got a farmer who's been on the land for generations and they've got a lot of crops that they're selling and maybe exporting, a mining company comes in and says ‘I want to explore your land for coal seam gas’, and the farmer thinks, ‘hang on a minute, this is going to blight my business; I don't want this to happen’. Why should he be allowed under law to be told by the mining company, ‘well, if you don't agree we'll take you to court’?

EMERSON: Well, firstly, most mining companies and coal seam gas explorers don't do that. They work very cooperatively with landholders. Second point I'd make, Leon, is that this is why we have environmental protection agencies, to make sure that the conditions, the environmental conditions for exploration and development are rigorous and that is the responsibility of states rather than the Commonwealth.

We do need, however, to develop our gas reserves. They are an enormously valuable asset for this country. And for Mr Abbott to say that there should be a right of veto over exploration for gas in this country itself creates sovereign risk and devalues the very great value of those assets.

So of course we should be working for harmony and most companies do that.

BYNER: Well, some don't. Some farmers are saying that they have been threatened with court action. But the other point I make, Minister, is that we have a food obligation not only to Australia but to the rest of the world.

EMERSON: I couldn't agree more.

BYNER: So surely … and there's the other suggestions from the CSIRO and other water authorities that at this stage the science isn't in yet as to what kind of harm this might do to an aquifer.

EMERSON: Well, we do have an obligation to Australia and to the world and it's not as if coal seam gas everywhere is threatening the very viability of farming in this country. I mean, there's prime agricultural land in your state, South Australia, in Victoria, and Tasmania. There's no coal seam gas exploration there that I know of. Perhaps there may be but I don't know of any.

In New South Wales and Queensland, yes, there is an issue in terms of the harmony between gas exploration and prime agricultural land but I imagine some of your viewers — listeners would have in mind that these are some big open cut mines. They're actually the sinking of exploration and ultimately possibly development wells and it is the responsibility of state environmental agencies who do discharge that responsibility to ensure that there isn't any undue effect on the water table.

We don't, you know … there's a Senate inquiry and I have no problem with the Senate inquiry. But it would be a big step for the Commonwealth to take up a new regulatory role here when, in fact, what we hear from business, including farmers, is that they don't like duplicated regulatory regimes. It would be better for the states to apply rigorous standards to ensure that there is harmony, and in most cases there is harmony.

Of course we hear from people who are dissatisfied, but we can't get taken to a world of Tony Abbott, of denying explorers access to minerals under the ground which actually are not owned by the farmers but by the people of Australia.

If we do that we elevate sovereign risk; we drive away foreign investors and that's bad for mineral development in this country and for our position in the world.

BYNER: All right. Senator Bill Heffernan, what do you say to that? What do you say to what Craig Emerson has just said?

You there, Bill? We haven't … we haven't got him.

Bill is concerned that we're making these decisions, Minister, before we know for sure whether there can be a harmony because there's great fear. We've got a situation in Bakersfield which was just explained to us, in America, where companies have actually upset the whole water environment. And now there's a two billion dollar court case. Surely we don't want to go down that path.

EMERSON: Well, what's the policy prescription here, Leon? That there be a moratorium on coal seam gas exploration in Australia? If that's the position that you or anyone else, including the Coalition, is advocating, fine, come out and say it. It's a democracy.

BYNER: No, I've got a … I've got a point here that our water supply and our food…

EMERSON: Yes.

BYNER: … should be at the top of the totem pole. Should it not?

EMERSON: Well, of course, and this is why I've been making these points about environmental protection agencies and I know, as the former director-general of the Queensland environment department, that very rigorous standards are applied. I've got no problem with a Senate inquiry. I'm not saying the world is perfect and I probably don't disagree fundamentally with what Bill Heffernan has been saying. I didn't hear what he said earlier on your program. But philosophically the idea of the coal seam gas industry working in harmony with farmers on prime agricultural land is one I think that we would all support.

But, if it gets to the world of Mr Abbott, that he was advocating on Friday, that there be a veto, well, if it's good for the coal — against the coal seam gas industry — why is it not right that farmers have a veto on all mineral development in Australia? You do that, you elevate sovereign risk to horrific levels and then you really fundamentally prejudice future jobs and living standards in this country.

BYNER: Bill Heffernan, what do you say to that?

BILL HEFFERNAN: Oh, look, in the evidence — good morning, Craig — in the evidence…

EMERSON: Yeah, g'day, Bill.

HEFFERNAN: … we've received … people like Santos have said to us that they will not enforce their legal right to enter properties. Now, obviously, we've got to make sure that there are areas where coal seam gas can coexist, especially in some of the rougher, more degraded country that have huge coal seam gas reserves under them. But in the prime agricultural land, on self-mulching flood plain, there are a whole lot of reasons which I haven't got time to go through now but I can explain to you in the minutest detail why we should have the political courage to say that's a no-go zone.

Now, some of the countries — companies that have given us evidence have said we are happy to — if we get heavier regulation and we're told there are no-go zones we're happy to work with those rules. And people like Santos and Jim Baulderstone have played an impeccably responsible … taken an impeccably responsible attitude to this. They've given evidence which was music to our ears, that they would not impose themselves.

Now, what we're talking about here, Leon, is not only the negotiation of the entry but it's also the absolute obliteration of what people consider to be their freehold rights of peace, quiet and knowing who's on your property: when they came on, when they went off. But also we're seeing absolute environmental vandalism in our field forays in this.

As Craig pointed out correctly, it is a state regime. If the states are not up to it, then someone else is going to have to do it for them. They are in direct line of royalty so they have this conflict between easing regulations to maximise the royalty stream. And, as I said to you earlier, how the hell can you give an environmental approval to an industry that is going to produce millions and millions … four and a half million tonnes of salt, that is in a pile on the ground, from one mining tenement over the life of the tenement?

No one knows at this stage what to do with it. I would have thought we would have had to work out what is a use for brine if they're going to do the [inaudible]. And what is the explanation of one aquifer — which is happening as we speak — leaking into another? What is the long-term impact of that? And, bear in mind, some of these mine shafts are going through the Great Artesian Basin to 1,000 metres below it. In eight years’ time that's going to be corroded and, you know, all sorts of problems.

Leon, just quickly, we are in Queensland. The regulators there have allowed the miners up there to take 300 to 400 gigs of water out of the Great Artesian Basin without a licence. Elsewhere in Australia we've spent hundreds of millions of dollars capping and piping the Great Artesian Basin to save about 200 gigalitres. So we're giving away twice as much as we save. In the saving we've spent hundreds of millions of dollars. It needs to be harmonised and, as Craig said, let the … let the Senate inquiry do its work. We'll do it robustly. I've been … I've been complained against for being pretty hard on everyone including the farmers, and that's the way it ought to be.

BYNER: All right. So, Craig, can you give a guarantee? Because my … my pitch here is purely to make sure we protect our food and water.

EMERSON: I think we all have that interest and I consider Bill's interest in protecting food and water to be an absolutely genuine one. But there are real hazards in having two layers of environmental approval; that is a state government player and a federal government player.

I've been responsible for reducing or harmonising, simplifying business regulation in this country…

BYNER: Yeah.

EMERSON: … and one of the biggest complaints from business, small and large, is that there are these duplicated approval processes where they get a tick-off from the State and then they have to go to the Federal Government and go through the whole process again. That's what I think we should be avoiding.

There's genuine evidence out of this inquiry that improvements can be made to state environmental protection obligations and regimes. Well, let's debate those. But I do not believe that the solution is to have two levels of approval in place of one effective level of approval.

BYNER: All right. Craig Emerson, thank you for joining us. Well, you've heard the arguments and shortly we'll get commentary from Dr John Hepworth.

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