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National coal seam gas agreement an important step in protecting water

A new national partnership agreement could allay a lot of CSG worries, if the states sign up. kateausburn/Flickr

A new national agreement designed to protect water resources from coal seam gas extraction and coal mining could offer a level of protection so far unseen in Australian environmental legislation. Any states serious about protecting water for farming and the environment should be signing up.

The Prime Minister announced the National Partnership Agreement for the Regulation of Coal Seam Gas (NPACSG) on November 21, 2011. NPACSG has been set up to strengthen the environmental regulation of coal seam gas proposals and large coal mining developments which may have a significant impact on water resources. Farmers, in particular, are worried that the gas extraction process threatens their water supplies.

The introduction of the NPACSG is partly a reward for Independent MP Tony Windsor, who asked for it in exchange for his support for the Mineral Resources Rent tax.

Following the announcement of the NPACSG, the Prime Minister wrote to Queensland, Victoria, South Australia and the Northern Territory governments asking them to be signatories. The Queensland government signed up to the agreement in February this year and the signature of the New South Wales government appears to be imminent. The remaining states are yet to join.

One of the financial incentives for signing up is that participants may share in a fund of $50 million, which has been set aside as an incentive fund for contributing state and territory governments. The fund is one of the central elements of the NPACSG.

NPACSG rewards jurisdictions that deliver independent scientific research into the effects of CSG on water resources. The funds will be used to assist the signatory states in implementing the objectives of the NPACSG. The benchmarks that signatory states need to achieve to access these funds are set out in the implementation plans which are incorporated in the NPACSG. When a state or territory attains these benchmarks, it will trigger a payment from the Commonwealth.

NPACSG also creates an Independent Expert Scientific Committee. The committee members are determined by the Commonwealth Minister and will serve at the discretion of the minister. An Interim Expert Scientific Committee has already been appointed, chaired by Professor Craig Simmons, a Professor of Hydrogeology at Flinders University and the Director of the National Centre for Groundwater Research and Training.

The independent committee will give signatory governments expert scientific advice on coal seam gas and large coal mining development proposals likely to have a significant effect on water resources. The committee has the power to identify which water resources are a research priority. Priority water resources will include those that have been subject to a high level of community concern and/or those that host a significant eco-system.

Where the committee determines that the water resource is a research priority, it may commission a bio-regional water assessment. A water assessment will evaluate a range of scientific factors. These include the components and toxicity of fracking agents, the impact of the fracking process upon aquifers, groundwater and surface water, and the effectiveness of the water management and monitoring plan set out in the coal seam gas proposal. (Fracking is the process used to extract gas from coal seams: you can read more about it here.)

The aim of an assessment is to improve scientific knowledge and increase understanding of the impact these processes have upon water resources. All water assessments will produce an evidence-based scientific report, outlining any possible threat to the water resource from the coal seam gas proposal.

NPACSG’s importance in regulating coal seam gas proposals should not be under-estimated. The independent scientific panel has the specific job of evaluating how coal seam gas and large coal proposals will affect significant water resources: this goes well beyond any other environmental regulatory protection. Whilst the report is only advisory, it does mean that future decisions regarding CSG proposals will be informed by a substantially improved and independent scientific body.

In this respect, the NPACSG provides broader and more extensive protection than the provisions of the Environmental Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC).

The EPBC is a Commonwealth Act which is supposed to provide greater environmental regulation over matters of national environmental significance. The bilateral agreement mechanism in the EPBC allows the Commonwealth to delegate either the assessment process or both the assessment and approval process for projects coming within the scope of the EPBC to state or territory authorities where a bilateral agreement exists (the NPACSG could be defined as a ‘bilateral agreement’ under s45(2) of the EPBC).

There are two primary criticisms of the EPBC process itself. First, there are insufficient environmental triggers for an environmental impact assessment to be carried out. There are only seven environmental triggers in the EPBC and the absence of a specific “water resources trigger” means a coal seam gas proposal may potentially fall outside the Act’s scope. This would mean that no environmental assessment under the EPBC would be mandated and therefore no Commonwealth approval to the proposal would be required.

For example, it has been held that two Queensland coal mine proposals did not constitute “controlled actions” under the EPBC because the alleged potential for greenhouse gas emissions to adversely affect the Great Barrier Reef World Heritage area were vague and unspecified and therefore did not come within the scope of any of the existing environmental triggers.

Second, the process of environmental assessment under the EPBC is narrow and linear and there are lots of exemptions. The first stage of an EPBC assessment is the referral, where the Commonwealth Minister decides whether a proposal is a “controlled action” because of its likely effect on matters of national environmental significance.

If it is, the proposal will be subject to assessment. Where this occurs, specialist consultants on behalf of the proponent of the proposal (not an independently appointed scientific body) will undertake an environmental impact assessment. These provisions are, themselves, the subject of much controversy given the potential for a conflict of interest. They have encouraged the development of a new industry of privatised environmental impact assessment specialists.

Once the assessment report is received from the proponent, the minister will decide whether to approve, approve with conditions or disapprove the proposal.

The defined scope of the Act, its project-based focus and the absence of any mandate for independent scientific research, make it particularly unlikely that the cumulative environmental impact of a coal seam gas proposal upon a significant water resource will be comprehensively evaluated under the provisions of the EPBC.

In light of this, joining the NPACSG and in so doing, promoting directed, and independent evaluation of the effects of coal seam gas mining upon water resources in Australia, has become an environmental imperative for the remaining States and Territories.

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