Office of Coal Seam Gas Reviewing the regulatory outlook for Coal Seam Gas development in NSW 28 February 2014 Rachel Connell Director, Office of Coal Seam Gas
Titles Existing Renewals New Petroleum Exploration Licence 39 18 20 Petroleum Assessment Lease 1 1 0 Petroleum Special Prospecting 0 N/A 8 Authority Petroleum Production Lease 6 0 3 Total 46 19 31
Current Activity Camden Gas Project Gloucester Gas Project: Stage 1 approved Proposed Narrabri Gas Project: Exploration and Appraisal Program underway MoU with Government regarding timeframes for assessing production applications Northern Rivers: Limited: Metgasco has just completed Plug & Abandon program, Metgasco has approval to drill exploration well near Casino Producing coal seam gas well in Camden, NSW
Outline of regulatory framework Petroleum (Onshore) Act 1991: Minister for Mineral Resources; Office of Coal Seam Gas Picks up obligations under the Work Health and Safety Act 2011 Protection of the Environment Operations Act 1997: Environment Protection Authority Environmental Planning and Assessment Act 1979: Minister for Planning and Infrastructure: Department of Planning & Infrastructure Water Management Act 2000 and Water Act 1912: Minister for Primary Industries; NSW Office of Water Pipelines Act 1967: Minister for Resources and Energy; Division of Resources and Energy. Environment Protection and Biodiversity Conservation Act 1999: Cth Minister for the Environment; Department of the Environment
Summary Complex regulatory framework. Approvals at exploration required under several pieces of legislation. Approvals at production required under up to 6 Acts. Valve stem and wheels on a coal seam gas well head.
The last two years A range of coal seam gas specific regulatory controls have been introduced in NSW over the last two years. Exclusion zones around residential areas and over critical industry clusters (equine and viticulture); Increased the role of the EPA: titleholders now required to have an environment protection licence at exploration previously just production; Established a specific Office of Coal Seam Gas to administer the Petroleum (Onshore) Act 1991 and petroleum workplaces under the Work Health and Safety Act 2011. An EPA Inspection of a producing coal seam gas well.
The last two years Introduction of the Strategic Regional Land Use Policy which provides additional protections for strategic agricultural land significant project involving the mapping of strategic agricultural land throughout NSW. A Gateway Panel has been established which operates as a pre-approval process: it involves and independent, scientific, upfront assessment of the agricultural land and water impacts of a mining or coal seam gas development on strategic agricultural lands; Adoption of an Aquifer Interference Policy to protect water resources across the State; Evaporation ponds and the use of BTEX chemicals have been banned; Implemented Codes of Practice to ensure best practice standards for well integrity and facture stimulation.
What s happening? Agency cooperation and coordination. Appointment of the Land and Water Commissioner has lead to significant improvements in community and stakeholder engagement; Creation of the Office of Coal Seam Gas has seen improvements in coordination across Government and improvement in service delivery to titleholders. NSW Land and Water Commissioner, Jock Laurie
What s happening? Draft Code of Practice for Land Access A draft Code of Practice for Land Access was exhibited for public comment from November to January this year. Prepared under guidance of the Land and Water Commissioner and involved the following groups: NSW Farmers Association; APPEA; Irrigators Council; Cotton Australia; NSW Wine Industry Association; and Hunter Thoroughbred Breeders Association (representing the NSW Thoroughbred Breeders Association). Commissioner also met with, and took on board, the views of other groups opposed to CSG exploration in NSW. Entrance to a property in the Hunter Valley.
What s Happening? Mandatory requirements in the Code will become mandatory clauses in an access arrangement. Once it can be made law the Code will ensure appropriate minimum standards for access arrangements. NSW Land and Water Commissioner, Jock Laurie It also provides the necessary flexibility to tailor an arrangement to suit individual circumstances.
What s happening? Petroleum Onshore (Amendment) Bill 2013 What it does? Modernises enforcement and compliance framework Provides for Code of Practice for Land Access Provision to make other Codes by regulation Title holders to pay legal fees throughout negotiation for land access arrangements Removes requirement to seek consent of adjoining landholders for seismic surveying on public roads. Consent of landholder still required. Industry worker at a coal seam gas well site, Casino NSW.
What s happening? Petroleum Onshore (Amendment) Bill 2013 Progress Through LA. Yet to be debated in LC Referred to Land and Water Commissioner in relation to environmental assessment permits and arbitration Government has tabled amendments to the Bill Implementation for industry
What s happening? Increasing transparency and information Better engagement with Local Councils and communities; Publication of titles and environmental approval decisions ICAC Recommendations being implemented Legislation before Parliament to introduce a fit and proper person test into the POA Community Consultation, AGL, Camden, NSW.
What s happening? Independent review of coal seam gas activities by the NSW Chief Scientist and Engineer The review is: Examining industry compliance; Identifying and assessing any gaps in management of risk arising from CSG activities, particularly as they relate to human health, the environment and water catchments; Considering appropriate ways to manage the interface between residences and CSG activity. NSW Chief Scientist & Engineer, Professor Mary O Kane
Independent review of coal seam gas activities by the NSW Chief Scientist and Engineer (Continued ) Commissioning technical papers on: Operational processes; NSW geology; Cows graze next to Water management; producing coal Horizontal drilling; seam gas well, Hydraulic fracturing (fraccing); Camden, NSW. Fugitive emissions; Health impacts; Wells and bores; and Subsidence. Initial Report in 2013; Awaiting a report which bench marks NSW regulatory controls against other jurisdictions; Compliance report by the end of 2014.
What s happening? NSW Office of Water representative measures water levels. Risk Assessment Project Assessment of risks of activities throughout the lifecycle of an operation Identify gaps and remove duplication; Communicate the effectiveness of the regulatory controls that are in place and how effective they are; Identify opportunities to streamline approvals
What s happening? Enforcement and compliance capacity Office of Coal Seam Gas has appointed specialist investigators, auditors and intelligence analysts Clear strategies and plans being developed Increasing regulatory scrutiny Taking appropriate compliance action Core hole drill site, Broke, NSW.
What needs to be done? Core hole drill site, Broke, NSW. Establish the Community benefits fund. Improve the licensing framework to provide clarity and certainty for industry and community; Acknowledge what the Productivity Commission has said: any regulatory change has a cost on industry; consultation should be fundamental component of any reform process. Increase in activity will, of course, be subject to industry gaining a social licence.
Outlining the potential for mutually beneficial land access agreements What has been done? Land and Water Commissioner working with stakeholders and communities Code of Practice for Land Access Not just the document, but the process is significant building relationships between landholder groups and industry Regulators engaging directly with communities and local councils Community Consultation, Camden, NSW.
What is happening? Community Consultation, Camden, NSW. Access arrangements: Camden: 41 Gloucester: 16 land access arrangements (not including pipeline) Narrabri: 30 NSW Farmers Information Forums The Gloucester Communications Project
What more is to be done? Industry efforts to gain social licence: Engage with Land and Water Commissioner for advice; Increase community confidence that regulatory controls are appropriate and effective; Increase community confidence that activities, such as drilling, management of produced water and fracture stimulation can be undertaken safely in the right context; Family on a farm in the Hunter Valley, NSW. Increase community confidence that regulators are undertaking an appropriate level of assessment before approving activities;
What more is to be done? Increase community confidence that the regulators are monitoring company activities and taking enforcement action where regulatory controls or standards have been breached; Improve support services to landholders through the negotiation process through the role of the Land and Water Commissioner. Children on a farm in the Hunter Valley, NSW.
Objectives Encouraging best practice Creating a safer industry Increasing community confidence. Workers & Inspectors at a gas plant, Camden, NSW.
Ultimately Demonstrate that activities can be undertaken safely Co-existence is possible Family on farm in the Hunter Valley.