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A matter of trust: – letter to Gloucester Advocate

Coal Seam Gas


Gloucester | Pilliga | Camden | Northern Rivers | Wollongong | Bentley
Woop Woop March | Aussies Against Fracking

GENERAL PURPOSE STANDING
COMMITTEE No. 5 27 MONDAY 31 OCTOBER 2011

GRAHAM HEALY, Chairperson, Barrington-Gloucester-Stroud Preservation Alliance, affirmed and examined;

GARRY SMITH, Project officer, Barrington-Gloucester-Stroud Preservation Alliance, sworn and examined:

CHAIR: Welcome to this hearing. Would either or both of you like to make an opening statement?

Mr HEALY: Yes. Thank you for the opportunity to address the Committee today. The Barrington-Gloucester-Stroud Preservation Alliance [BGSPA] was established in 2006 in response to the sudden and dramatic expansion of mining exploration and development within the Gloucester-Stroud Valley, including the major expansion of coal exploration and mining and the commencement of coal seam gas exploration over an extensive area of the valley.

The alliance is seeking to ensure that the general rural character of the valley is preserved by opposing developments that are injurious to this character and environment. We are local town residents and rural landholders who are either impacted by current or proposed mining or who are generally concerned about the impact of all this proposed mining on the natural resources and amenity of the valley.

The alliance has made a substantive submission to this inquiry, which responds fully to the terms of reference and includes a list of essential recommendations that we consider to be critical to undertaking the necessary review of all aspects of this industry.

Our submission to this inquiry comes fairly hot on the heels of another major submission prepared in response to the environmental assessment released by AGL in support of its proposal to develop a 330-well coal seam gas field in the Gloucester-Stroud Valley.

The environmental assessment was a massive document, comprising five large volumes and thousands of pages. To respond to the environmental assessment required an understanding of complex geological, hydrological, engineering, technical, health and environmental issues.

We were fortunate in having a body of expertise in our community and this was supplemented by the work of independent experts who provided advice and assistance.

I mention this simply to make the point that our submission to this inquiry is a substantive work based on several years of investigation, analysis and expert opinion. It is not my intention to restate the detail of the matters raised in our submission to this inquiry other than to highlight some key points.

We consider that the pollution risk to surface and ground water systems created by coal seam gas extraction presents the greatest environmental danger yet imposed on the Australian landscape of any mining or industrial process so far undertaken in this country.

We are particularly concerned at the inadequate hydrogeological assessment undertaken by AGL for its Gloucester gas development given the complex geology of the Gloucester-Stroud Valley.

The valley is particularly vulnerable to environmental damage by gas extraction because of the valley's unusual geological formation that involved intense lateral folding, volcanic action and complex erosion processes. These resulted in a complex pattern of geological faults and shears that create exceptional risks of gas migration and watertable damage.

For the information of the Committee, Mr Smith has brought along a definitive reference map which clearly reveals the complex geology. We cannot table that but it is available for inspection by members of the Committee and we invite questions on this particular aspect.

As was mentioned this morning, Gloucester-Stroud Valley has already experienced incidents of methane gas migration during exploration and as a consequence of this we believe the process of fracturing, or fracking, should be banned.

The cumulative impact of multiple mining developments on environmental qualities is a neglected area of environmental assessment. This is particularly relevant in the Gloucester-Stroud Valley where coalmining and coal seam gas extraction are not allowed. We are also concerned that cultural heritage and tourism aspects have not been adequately dealt with.

Our colleagues from Tourism Advancing Gloucester will be giving evidence later today and we welcome further questions in this area. I have deliberately not mentioned the health impacts of coal seam gas as our management committee member Dr Steve Robinson will be dealing with this issue when he appears before the Committee later today.

I have some general comments about coal seam gas. In approving AGL's Gloucester gas project in February this year the Planning and Assessment Commission noted that the coal seam gas industry is relatively new in Australia.

The experience of this industry has not been a happy one. In communities up and down the eastern seaboard voices have been raised in alarm. More than 10,000 people attended anti coal seam gas rallies in New South Wales and Queensland earlier this month. I cannot recall an issue that has so galvanised such a broad cross-section of Australian society since the anti-Vietnam War marches.

This industry does not have a social licence to operate. There is a single unifying thread linking the concerns of all these communities — water.

Continuity and quality of water supply is the greatest environmental challenge facing Australia and in fact the world today. It is our most precious resource—more precious than coal, gold, gas or any other mineral that can be extracted and we must bestow upon it the highest level of environmental care.

In December 2010 the National Water Commission warned about risks to sustainable water management from inadequate regulation of the coal seam gas industry, and specifically said the potential impacts of coal seam gas developments, particularly the cumulative effects of multiple projects, were not well understood and that the coal seam gas industry "risks having significant, long term and adverse impacts on adjacent surface and groundwater systems".

The National Water Commission is not alone. It seems there is a new warning from an independent expert issued on a weekly basis.

There is so much publicity about the coal seam gas industry, too much to keep abreast of, and none of it positive. I cannot recall one independent authority speaking in support of this industry. Even the coal seam gas industry itself has considered gas extraction will inevitably contaminate aquifers.

In August, Mr Ross Dunne, spokesman for the Australian Petroleum Production and Exploration Association, was reported in the Sydney Morning Herald as saying, "Drilling will, to varying degrees, impact on adjoining aquifers.

The extent of the impact and whether the impact will be managed is the question." It beggars belief that warnings about the need for a precautionary approach to this industry have been ignored in a short-sighted race to turn Australia into a quarry for the world's developing economies.

In conclusion, the alliance urges the Committee to make two recommendations. I know these have been covered in questions and evidence this morning.

Firstly, that a moratorium be imposed on all coal seam gas exploration and development until an independent scientific investigation advises the industry is able to operate in an environmentally and socially responsible manner.

Secondly, that the Government adopt a strategic land use policy which would see defined areas quarantined from extractive mining because alternative land use is considered to be more sustainable, more productive and more socially and environmentally desirable.

This would provide certainty for both landholders and mining companies and obviate the conflicts and stresses caused by the present approach whereby the entire State is potentially going to be affected.

CHAIR: Thank you. Mr Smith, would you like to make any comments?

Mr SMITH: I have no prepared comments. I will add to the questions and issues raised. There are two matters I would like to speak to.

The first is geology, and I know we are labouring the geology but it must be done because the full risk of the Gloucester geology is not understood at all.

The second issue I want to address somewhere in the questioning procedure is the valley's scenic heritage significance. This is not just a shallow superficial thing. It underpins its economic base, its tourism industry and its lifestyle settlement. I would like to speak to those two matters.

The Hon. GREG DONNELLY: In your submission recommendation 3 links with a point you make on page 11 about the question of legislation and regulation for this industry. Can you elaborate further on that part of your submission? It is obviously an important aspect. What is your thinking about what needs to be done in looking at the legislative and regulatory framework for this industry?

Mr SMITH: There are two main areas. The first is the Petroleum (Onshore) Act 1991, which empowers exploration and the granting of licences. As mentioned earlier, the exploration process is basically a production process in terms of potential pollution and damage and nowhere are those issues addressed in the Act.

Issues of air pollution, possible water pollution, flaring, and use of chemicals are not addressed in the Act, so the Act itself is not sufficiently regulated. Part 3A of the Environmental Planning and Assessment Act has been repealed but the new provisions under part 4 appear to duplicate the part 3A provision in relation to mining so there is no improvement.

Two big areas need to be addressed. The first is the huge power given to the Minister. The Minister's position has basically become a law unto itself. The second issue is the inadequate environmental assessment that has been enabled by part 3A provisions, and now part 4, whereby major environmental statutes are either restricted or turned off. I speak of the Water Management Act, the Heritage Act, and the National Parks and Wildlife Act.

When I did a tally there were something like 11 Acts and environmental statutes that are important to the whole environmental process that are either turned off totally or severely restricted. They are the two main areas that have to be addressed. I believe the legal issues need an inquiry in their own right; the issue is that big.

The Hon. GREG DONNELLY: What sort of inquiry did you have in mind—like this type of inquiry or something else?

Mr SMITH: In terms of a legal inquiry?

The Hon. GREG DONNELLY: In terms of trying to grasp what would be the key elements of legislation and regulation in this area.

Mr SMITH: Just off the cuff, I am envisaging an inquiry that would be of equal standing to this one.

The legal investigations are a major issue of this inquiry but I believe they are so big they warrant an inquiry in their own right to concentrate totally on the legal aspects because they are so broad. We look at the Petroleum (Onshore) Act and the Environmental Planning and Assessment Act and then we have to look at the interrelationship with all the other environmental statutes, property acquisition and the whole lot. It is a huge undertaking.

The Hon. JEREMY BUCKINGHAM: Would one or both of you expand on your submission regarding the geology of the Gloucester-Stroud Valley? An important part needs further investigation. On page 5 it says:

The assessment of the valley's coal resources in the above study considers that coal cannot be mined safely and economically in the northern end of the valley and yet the AGL project has been approved to extract gas in the same area, and with critical issues including impact on water left unassessed.

Can you expand on that for the benefit of the Committee?

Mr SMITH: It is a very difficult area because we get conflicting opinions. There are early studies— and if I had had notice of the question I could have tabled those studies—going back to the Loughlin report in about 1954 and various subsequent reports that coal could not be economically and safely mined in the northern part of the valley.

It would appear that by mining they meant traditional old-style pit mining. It could not be safely mined because of the complex fractures and faults and the breaks in the coal seams and the slanting nature of the coal seams. It could not be economically mined, although someone might say coal is worth a lotmore now so some of that problem could be overcome, and certainly that would be the case.

However, the issue with the sloping coal seams, the fractures and the breaks still exists. They are still there; that has not changed.

The geological advice we received privately was that long wall mining would similarly be difficult and dangerous because of those same faults. We are concerned that gas mining is going ahead on that same geological country.

The Hon. JEREMY BUCKINGHAM: So your suggestion in the submission is that the complexgeology is not like a layer cake with coal and sandstone in set strata. Mr Healy, I think you said there was a suggestion that methane gas migration had already been observed. Can you expand on that?

Mr HEALY: That was mentioned by Councillor Rosenbaum this morning, but Mr Smith is better placed than I am to elaborate on that.

Mr SMITH: I could look at the notes to get the exact title of the report but the incident was September 2004, the report was written in December 2004. It was by C. M. Atkinson. Its title I recall as being "Coal Bed Methane Hazards in New South Wales". It was, for quite a time, on line and possibly still is and could be googled. But there was a methane eruption at Stratford due to striking an old exploration hole and considerable methane escaped and that was considered at that time to be potentially dangerous at a very high level. It was caught in time and plugged.

CHAIR: Mr Smith, would you be able to take a question on notice and provide the Committee with the references for the earlier 1950s report that you quoted? Would you be able to find that for us?

Mr SMITH: I could go through them and find them. I recall one was by Lachman. There were some subsequent reports.

CHAIR: Anything you can provide us with would be helpful.

Mr SMITH: There is also a brief view in the definitive geology of the area compiled, I think, under the editorship of Professor Brian Engel and I would also cite that. I can get a list to the Committee later.

CHAIR: Thank you. That would be helpful.

The Hon. RICK COLLESS: Mr Healy, I think you mentioned in your report and in your address that you were disappointed in the—I think the word you used was "thoroughness"—of the geological assessment done by AGL. Surely any exploration organisation such as that must be extremely thorough in their research process before they would commence any drilling activities or anything. Why do you say they have been less than thorough in their geological assessment?

Mr HEALY: Because the simple fact is that there is no hydrogeological study undertaken prior to submitting the environmental assessment. That is one reason they have been given conditional approval for the concept plan and instructed to go away and do these studies that they did not do prior to submitting the environmental assessment. We had a public question and answer session which we invited AGL to attend to answer questions raised by the community. That was one of the points considered by AGL—that it was an oversight—and they received criticism for not having done that previously. Perhaps Mr Smith can elaborate on that.

Mr SMITH: That broadly covers it. The thing that is happening now is that AGL are doing ongoing seismic testing, for the simple reason that they do not understand the geology. The environmental assessment they presented to the director general, to the Minister and to the Planning Assessment Commission did not fully describe its characteristics. They did not have a good understanding of the geology. We have a professional report by Professor Alex Grady stating that they have a poor understanding of the hydrogeology. And they are still doing testing now, testing that should have been done before the development application was considered.

The Hon. RICK COLLESS: What sort of testing are they doing?

Mr SMITH: Seismic 2D and 3D testing. I am not a geologist familiar with the exact procedure and I cannot enlarge upon that but they are again looking to ascertain where the fractures, faults and shears are. Mr Healy referred to a map earlier and I would table that map, if it helps to understand the complex geology.

This is a definitive mineral resources geology map of the Gloucester Valley and when you look at it, you can see the mass of faults and shears indicated by lines. We have geological advice from a member within our group and from outside the group that these represent only the basic geological structures that are so far known and that in fact the shears and faults are much more severe. Would you like to me to show you that?

CHAIR: Mr Smith, if you are prepared to table the map we can give you an undertaking that the map will be a taken back to Sydney, copied and returned to you.

Mr SMITH: If the members of the Committee felt that it was of use to them, they could retain the map as long as they like. It is a field working copy, it is a little battered and it has been taped back together but the benefit of it is, we have added to the top part of it some of the Gloucester roads and landmarks so that you can see exactly where it happens.
CHAIR: It would be helpful if you would table that.

Leave granted.
Document tabled.

The Hon. RICK COLLESS: Gentlemen, in your submission you refer to shale gas and coal seam gas and you state that it does not matter whether it is coal seam gas or shale gas, the same problems apply. Is that where you are coming from in that comment in your submission?

Mr SMITH: It was only intended as an answer to some methane gas comments. They are saying, "That applies to shale gas and it does not apply to methane gas". The broad principles apply to both. I am not a geologist so I cannot get to the bottom of it but there is much overseas comment that methane gas extraction may, in fact, be riskier but I cannot put any evidence to the Committee as to whether it is or is not. I am only objecting to the comment by coal seam methane gas companies that somehow their process is not risky.

The Hon. RICK COLLESS: As I understand it, they are both methane but one comes out of shale and the other from the coal seam.

Mr SMITH: Yes, it is still the same gas. Our advice is it still has the same pollution problems. But I think the comments by the gas companies were directed at the film Gasland and they were saying, "That is shale gas; it is not the same". But much of it is common to both industries.

The Hon. SCOT MacDONALD: You have a statement in your submission—one common to a lot of submissions up and down the coast and out west—that you fear an impact on property values. Is there any evidence of that or is that just what you foresee happening?

Mr HEALY: Thank you for that question. I am having personal experience of that. It is a situation that applies to coal mining but it applies equally to coal seam gas.

We have a situation with a mine operated by Gloucester Coal and there is an extensive exploration licence up the valley which is now overlaid by this petroleum exploration licence.

In 2006 they applied for an extension of that, for a new exploration licence to adjoin that. Immediately that happened—and this is the point Councillor Rosenbaum was making this morning about the sophistry in saying that exploration is somehow benign and separate to mining, which is a load of rubbish—as soon as that exploration licence is granted, not only does the value of those properties fall, but the capital becomes frozen because people cannot sell them.

Nobody wants to live next to a coalmine or in the middle of a coal seam gas field. I can give you an example of neighbours of mine who had to move away because their business went bad and they had to find alternative employment and they cannot sell their property.

They are in a desperate financial situation. Their property is outside the footprint that the mining company would be interested in and they are stuck. That is not an isolated incident. And that is one aspect of all this
mining that has really hit my hot button because nobody ever talks about it; nobody ever thinks about it. It destroys people's lives.

The Hon. JEREMY BUCKINGHAM: I would like one or both of you to expand on the submission by Dr Steve Robinson. It is included in your own submission. It is the submission on the potential for cumulative health impacts in the Gloucester Valley. I have visited the vale of Gloucester and it is not a wide valley. You have already got significant coalmines and they are set to expand. Would you detail what you believe the potential health impacts could be in that valley if coal seam gas mining goes ahead?

Mr SMITH: I do not think that I can address that as well as Dr Robinson can but we have been concerned for some time that emissions, whether they be from flaring or from diesel machinery being used in the process, that the total emissions are not being considered in conjunction with the coal dust emissions from the coal industry. I live at the northern end of the valley and I have noticed over the last two years a gradual increasing greyness in the morning fogs. We are prone to fogs because of air inversion from the Barrington Tops area. This should have been considered in the environmental assessment because we have particular air characteristics peculiar to the Gloucester Valley. I am noticing increasing grey in the fog. I cannot give scientific evidence of that but the cumulative impact of gas and coal desperately needs to be properly assessed.

Mr HEALY: We deliberately chose not to talk about health matters because Dr Robinson is appearing before the Committee this afternoon and he is our resident expert on health matters.

Mr SMITH: May I table some information?

CHAIR: Please proceed.

Mr SMITH: I mentioned earlier that the Stroud-Gloucester Valley now has tourism as its major industry. The valley is particularly attractive scenically. It was classified by the National Trust in 1975. A submission was put to the Registrar of the National Estate in 1976 to have the valley assessed for national heritage significance. That did not proceed.

The alliance undertook a heritage study in 2009 and the National Trust revised their study in 2011. That is in substantial agreement with the alliance assessment.

A further nomination has been made to the Department of Sustainability, Environment, Water, Population and Communities to assess the Stroud-Gloucester Valley for having national heritage significance in the 2011 and 2012 program. The last advice was that that is in process but we do not have anything further to report.

I do have some documents: The National Trust listing, a copy of the application for national heritage significance and a copy of our document, The Vale of Gloucester. I would like to present those to the Committee in the hope they may be of some further use.

Leave granted.
Documents tabled.

The Hon. GREG DONNELLY: With respect to recommendation No. 4 about greater community consultation, do you have any thoughts about how that might be done in practice, compared to the position at the moment?

Mr SMITH: I am sorry, I missed the question.

The Hon. GREG DONNELLY: It is a question about your recommendation about greater community participation. What did you have in mind in that regard?

Mr SMITH: It is one of the areas I have probably given less thought to. We were concerned that, when the Planning Assessment Commission visited the Gloucester Valley, they did not have any community consultation at all and we felt that that was a very bad thing and a very serious omission. So I think I am looking for increased consultation at the predevelopment stage. I would think it needs community meetings. I cannot enlarge beyond that at this stage, there is too much to consider.

Mr HEALY: It was canvassed a little in this morning's discussion about the effectiveness of community consultative committees and the effectiveness of involving the community in the project. I must say, at one level AGL has been quite skilful at providing a certain level of information to the community and engaging with the community. But the real issues of serious consultation and the effectiveness of community consultative committees need to be addressed. At various times over the last few years the various Ministers responsible for these things have held these up to be the be all and end all in the way that members of the community can resolve their difficulties with the company and have all the issues explained to them and really seek information.

The community consultative committees are constituted with narrow terms of reference, even with an independent chairman as someone mentioned before, and their scope, their authority to influence and their ability to extract information is quite limited. Really their effectiveness often tends on the quality of the people on the committee and whether they are prepared to stand up and push the issue. I would encourage this Committee to look at the issue of community consultative committees because it is not working effectively in respect of coal or coal seam gas.

CHAIR: Mr Smith, will you please submit those references to the Committee within 21 days.

Mr SMITH: I will do that.

(The witnesses withdrew).

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