Coal seam gas lies 2

My mum, bless her thoughtful heart, just sent me a bunch of newspaper clippings from Sydney, about coal seam gas.  There’s one that’s a full page ad from APPEA (Australian Petroleum Production and Exploration Association) in the Sun-Herald, August 7, p13.

In the 10 paragraphs of the ad, I counted 7 statements that are untrue or misleading.  I know it’s naive to be gobsmacked that an ad could so unashamedly misrepresent the facts.  I know there are billions of dollars at stake for the companies involved.  But I still find myself astounded an industry can lie so openly, apparently confident that people are too stupid to catch on.

If this were an ad for toothpaste, or a clothing chain, I’d probably let it go.  Doesn’t really matter if someone lies about toothpaste (well yes it does, but I’ve got turmeric to plant, and I don’t have time to be porky policewoman for every untruth printed in the newspaper).  But these are very, very dangerous untruths being spread by the mining industry.  If people believe these, and decide to give the industry free reign, then the likely environmental and human consequences could be huge.  So below, I’ve written why I think those 7 statements are false.

I thought it grimly ironic that the first paragraph reads, “Many facts regarding Australia’s coal seam gas (CSG) industry have become obscured in the heat of recent public discussion.”  Yes, quite.  The reason for that is advertisements like the one I’m talking about, that deliberately obscure the facts.  And mining company representatives, like the CEO of Metgasco, who also obscure the facts.

Here we go:

Misrepresentation number 1:

“CSG – which is simply natural gas”

This is a double whammy.   First, calling something “natural” gives it an immediate environmental spin.  What is often called “natural” gas is in fact fossil fuel methane (and sometimes other gases, like ethane, propane and butane).  It’s just as unrenewable, and “natural”, as coal and oil.

Second, CSG is not simply what is known as “natural gas”.  It’s a special kind of “natural gas”, that requires very special processes to extract it from the ground.  Those processes result in, among other things, huge amounts of toxic waste that gas mining companies need to dispose of somehow: legally, illegally, or in ways that really should be illegal but aren’t.

Here are some ways they dispose of it:

One way to dispose of contaminated waste water is to build huge “evaporation ponds” that can cover areas on the scale of hectares.  Unfortunately for the neighbours, volatile toxins evaporate into the air – the air that everyone breathes, and also the air through which rain falls before it lands on people’s roofs and drains into their drinking water tanks.  There is little provision for emergencies like floods, which can lead to overflow of the ponds into waterways and other people’s land.   One neighbour was told by a mining company representative that the company wasn’t worried by the possibility of their ponds overflowing in a flood, because if it started to rain that hard, they would just truck the water away.  In trucks?  In a flood?  Around here, when it rains flood-hard you can’t get very many places in a vehicle because it’s too wet.

On top of all that, in order to build the ponds, they have to clear the area of vegetation.  Sometimes this vegetation is of such environmental significance no one else, except mining companies, is allowed to touch it.

The NSW State government made much of the fact that they were banning evaporation ponds.  But… and this is a kicker…only for new exploration and mining licenses, NOT for the large amounts of NSW already covered by existing licenses.

(NB I can’t find an actual source for the precise % of NSW covered by existing licenses.  I can’t use MinView because our dial-up is too slow – but secondary reports seem to vary between 25% and 70% of NSW, weighted towards the 70% end.  I can’t confirm that – does anyone have a good source, or can sneak a look at MinView for me?)

Evaporation ponds are only part of the story.  The Sydney Morning Herald magazine reported (Aug 13) that last year, Australia Pacific LNG Pty Ltd was given permission by the Queensland government to dump treated water containing at least 80 different chemicals and radionuclides, up to 20 megalitres per day, for 18 months, into the Condamine River, and thence into the headwaters of the Murray-Darling.  No-one even knew about it until the National Toxics Network pointed it out in June this year.  What other permissions have been given?

If all else fails, evidence suggests that companies dispose of their contaminated water illegally.  There is a video circulating (I haven’t seen it yet because we’re only on dial-up here) that shows a CSG truck driving along the road with the tap open, disposing of water illegally onto the road (and from there, into local creeks and rivers) as the truck drives along.  Visitors from Queensland speak of roads that are commonly wet down one side only.  Rain?  I don’t think so.


Gaseous pollutants are easier to dispose of – simply release them into the air.  Air from near “natural gas” development has been found to contain neurotoxins, carcinogens and respiratory irritants.

Misrepresentation number 2

“Gas produces baseload electricity with up to 70% fewer emissions than coal.”

From the site:

“[The 70% figure] only refers to the emissions released when the gas is burnt. It does not include the emissions involved in producing the gas – the drilling, fracking, compressing, pumping, liquefying and transporting the gas; nor the loss of carbon-storing forests and woodlands cleared to make way for gas wells and pipes…Liquefying natural gas consumes at least 20% of its energy value and cancels almost 30% of its “clean” character.” (Reference)

Even Belinda Robinson, CEO of APPEA, admits that these processes are likely to produce significant greenhouse emissions.  She writes:

“Yes, it is true that extracting and processing this gas is energy intensive – and so too is shipping it to the energy-hungry economies of China, India, Malaysia, Japan, and Korea.”

Not to mention the greenhouse emissions from methane leaks. The IPCC 4th assessment report says:

“The substantial leaks of gas to atmosphere before combustion are not included in the 70% figure.  Methane is the major component of natural gas. It is a much more potent greenhouse gas than CO2, 72 times more effective at trapping heat in the atmosphere over a period of 20 years, or 25 times more effective over 100 years.”

A related statement in the ad is this one:

“…switching to gas-fired electricity has been shown to be the most efficient way to reduce greenhouse emissions.”

This gives the impression that CSG is “environmentally attractive”, as the CEO of Metgasco tried to claim in his talk to our local community.  But even, just say, that CSG does result in fewer greenhouse emissions, you have to also consider the potentially catastrophic contamination of water, air and food producing areas, not to mention wildlife habitat.  Painting it as clean and green because when you burn it, it doesn’t give off as many greenhouse gases as coal, is misleading at best.

Misrepresentation number 3

“Queensland and NSW have enough CSG to power a city of 5 million people for 1000 years”

This gave me the impression that Queensland and NSW owned the CSG, and so the benefits of extracting it would be that either:

  • we could use it ourselves, that is, the 5-million-people city would be in Queensland or NSW (or at least in Australia),
  • or that the profits from any sale of our gas reserves would go towards our state or federal budgets.  Surely, if Qld and NSW have the CSG reserves, then we should get most of the money when we sell them, right?  Wrong.

It appears that while Australia will be using some of the gas, the industry plans to export much of it.  From Belinda Robinson, the chief executive of the Australian Petroleum Production and Exploration Association:

“Today, we have two liquefied natural gas export facilities under construction in the Queensland port of Gladstone at a cost of more than $15 billion each.  And remarkably, we have two larger projects for Gladstone at advanced stages of planning and approval”

To add to the fuzziness of CSG issues, the industry often lumps the benefits of CSG together with the benefits of conventional gas, so I’m assuming these facilities will also handle conventional gas.  But 2 lots of $15 billion?  Plus two even larger projects?  With that amount of investment in infrastructure, it seems that the industry has plans for exporting an enormous amount of those Qld and NSW gas reserves.

So if they’re exporting the gas, who gets the money from the export sales?  Not Qld or NSW, it seems.

The companies that are mining CSG in NSW and Qld are mostly foreign-owned multinationals.  According to the Petroleum Exploration Society of Australia, in Qld, they pay 10% royalties on the gas they extract, and taxes on their profits, but I mean, 10%?  The Qld government has been reported as saying that they expect $200 million a year in royalties from coal seam gas.  That sounds like a lot, until you compare it with an industry that is happy to spend more than $60 billion on export infrastructure.

In NSW, companies don’t even pay royalties for the first 5 years of production – the Exploration NSW website explains:

“the NSW Government currently has a Royalty Holiday initiative that applies to production from each and every Production Licence (PL). Under the initiative no government royalty will be levied during the first five years of production with royalty of only 5% in year six of production with an additional 1% royalty being levied each year until reaching 10% in year 10.”

So who are these companies who sell our gas reserves and keep the money?  Well, ownerships change frequently, with buy-outs and takeovers, so it’s sometimes hard to keep up, but at the moment:

  • Arrow Energy, which holds licenses over northern NSW, is co-owned by Royal Dutch Shell and the China-based company PetroChina
  • Metgasco, which holds licenses over the area to the south of us, is waiting to be bought out by a company that can finance its pipeline plans
  • Qld Coal and Gas (QCG) which operates in Qld, is owned by BG Group, a British-based multinational.

None of these companies give their profits to the people of Qld or NSW.   So a more accurate statement might be “Queensland and NSW have enough CSG to power a city of 5 million people for 1000 years, and we’re planning on giving it to multinational businesses for pennies on the dollar.”

Misrepresentation number 4

“CSG production relies upon tried and tested technology.  It is technology that has been used in more than two million oil and gas wells around the world since 1948 and it’s been used across Australia for many years.”

Fracking was first used in the oil and gas industry in 1948, and CSG proponents often use this as a basis for the “tried and tested” claim.  However, fracking methods developed in the last decade are different. They involve higher pressures and require large volumes of water.  They are not “tried and tested” at all.

On top of that, Ross Dunn, an industry spokesperson, has been quoted in the Sydney Morning Herald (3.8.11) as saying “Drilling will, to varying degrees, impact on adjoining aquifers.  The extent of impact and whether the impact can be managed is the question.”

If it’s a question, it can’t be tried and tested.

(At the Casino information night, the CEO of Metgasco tried to deny that Dunn had ever said any such thing.  Luckily, Dr Mariann Lloyd-Smith of the National Toxics network was there to point out that he had in fact made the statement, and that she knew because there existed film footage of it.)

Misrepresentation number 5

“The industry has always been open about the processes involved with CSG extraction.”

Really?  It’s been my experience that the industry has always tried to muddy the waters and misrepresent the facts.  This ad is one example.  Here’s another.

And it’s not just me.  The National Toxics Network also found industry secrecy a problem during their investigation into fracking chemicals:

“Constituents of fracking fluids are often considered ‘trade secrets’ and not revealed. Even regulators are left in the dark.  Risk assessments for specific CSG projects in Queensland lacked basic information on the chemicals. The ones we were able to identify concerned us because of their significant potential to cause damage to the environment and human health. Some were linked with cancer and birth defects, while others damaged the hormone system of living things and affected aquatic species at very low levels.

“Despite industry claims that fracking chemicals are ‘only used in small quantities’ and are all ‘food grade chemicals used in household chemicals’, NTN has discovered that hazardous chemicals such as ethylene glycol, formamide, naphthalene, ethoxylated nonylphenol and sodium persulfate are commonly used in fracking mixtures.

“To give you an idea of the quantities involved, in one QLD proposed coal seam gas operation it was reported that 18,500kg of additives were to be used in each well during the fracturing process.”

How is that “food grade” in “small quantities”?

Misrepresentation number 6

“Our industry’s small footprint and long track record in Queensland show that it can co-exist with other industries.”

This is simply not true.  It’s drawing a long bow to suggest it can co-exist with the agricultural industry. 

This is why farmers find this whole thing scary.   This is the story of one farming coupleHere’s some more stories. And another.

And CSG mining certainly can’t co-exist with the organic farming industry – you can’t have organic certification with contaminated air and water.

And another thing.  Here is a pic of an evaporation pond.

Evaporation pond

How can you farm on that?  Really.  I don’t know how big this one is, but the Environmental Defender’s Office says Metgasco’s are up to 12 hectares.  That’s a big footprint, and that’s only one pond.

Misrepresentation number 7

“This experience is reinforced by rigorous laws that ensure every aspect of every CSG project in Australia is assessed, approved, and audited by state and federal governments.”

The coal seam gas industry is not regulated by rigorous laws.  In some cases, it appears to be above the law.  For example:

  • the Native Vegetation Act 2003 prohibits farmers from clearing many areas of native vegetation.  Mining companies are not bound by the same restrictions.
  • Local council zoning restrictions certainly do not apply to CSG mining companies.
  • Mining companies are exempt from important parts of the NSW Water Act 2000, including those designed to control water contamination and land degradation.  (I don’t know the situation in Qld.  If you know, please leave a comment or email us.)
  • A specific example is the laughable NSW state government self-congratulation over the introduction of a regulation that requires CSG companies that extract more than 3 megalitres of water per year to hold a water access licence. Try selling that to the farmers who need licenses for every single litre of water they extract for their farms.

I believe there are more examples, but you get the picture.  There’s one law for CSG companies, and one for everyone else.  And calling the CSG laws rigorous is simply incorrect.  How is the allowing, by the Qld state government, of the dumping of 20 megalitres of contaminated water per day, for a period of 18 months (see Misrepresentation Number 1), rigorous?

On top of all that, the chemicals used in CSG extraction are poorly regulated.  The lead author of a National Toxics Network report said “Our investigation found that of 23 common fracking chemicals used in Australia, only 2 have ever been assessed by NICNAS, Australia’s industrial chemicals regulator. The two that were assessed, have never been assessed for use as fracking chemicals.

“Fracking chemicals are complex mixtures of different chemicals which increases their risks. They are being used in very large volumes and unknown concentrations for purposes they were never intended for.”

And one more thing.  Mining companies often tell you that they have to complete a report called a “Review of Environmental Factors” (REF), in which they must say what they plan to do to minimise environmental disruption, before they are granted an exploration license.  That’s true.  And supposedly, compliance with the REF is “required”.  But in practice there is no enforcement.  That is, if the company doesn’t do what it said it would, there are no consequences for the company.

And we’ve heard reliable reports from other CSG mining areas that while companies are supposed to employ “spotters and catchers” (people who comb areas to be clearfelled to remove wildlife in advance of the bulldozers), what happens in practice is that the bulldozers are sent through, then the “spotters and catchers” move through picking up the dead and injured.

So, rigorous laws my arse.

Phew. End of tirade.

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5 Responses to Coal seam gas lies 2

  1. JIM LEGGATE says:

    Thank you for such a wise comment on the potential impacts of mining. I too am sick of the spin from mining companies. I am much more interested in “runs on the board” or proven performance. Sadly the coal industry has shown itself to be uncaring and unregulated. In the last 30 years it has made a dreadful mess in Australia. Please see my submission to the Senate which has been posted on the web Submission pdf 215

    • Sarah says:

      Hi Jim,

      Are you the Jim Leggate, Qld mining whistleblower? It’s an honour to have you make a comment. Thank you for all your work in this area.

      For some reason the link to your submission didn’t work for us (we’re on dial-up, so that might have been it), so if anyone else has the same problem, we found you can also get it from the site below, if you scroll down to submission 215.

      All the best,
      Sarah and Felice.

  2. JIM LEGGATE says:

    Yes – I am the whistleblower, and I am very concerned that the mining industry in Australia is operating above the law, and out of control. We are leaving a big expensive clean up to some future time. The mining industry cries poor on rehabilitation and then makes record profits! Sorry about the Senate link.

  3. Bob Roeth says:

    NTN reports suggest a life for a well to be 30 years. Thats a long time for leaks, spills,evaporation, increased mobility of natural and introduced chemicals, etc etc to wreck our soils, atmosphere, waterways. The cost of that remediation should be charges against the companies that would become billionaire companies that should never become bankrupt and never want to be taken over unless it is to dodge its moral and legal responsibilities. How many of the companies plan to set aside billions of dollars in inalienable storage to pay for the remediation when the wells are no longer producing sufficient profit to justify their operation?

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