Chris Ketter (Queensland, Australian Labor Party) Share this | Hansard source

When a party comes before this place seeking to shut down an industry, I for one have grave concerns—particularly when we are talking about industries which make an incredible contribution to my home state of Queensland. Properly regulated oil and gas operations are safe and the Australian minerals and oil and gas industries have a strong compliance record. Senator Siewert's motion, spoken on by Senator Milne, makes a number of points that require a response. The motion is obviously timed to coincide with the New South Wales election and to contribute to the anti-science scare campaign currently being waged by inner-city activists.

Coal seam gas is not a well-developed industry in New South Wales. In fact New South Wales imports 95 per cent of its gas from other states. Senator Siewert's call for a ban on such mining in that state would see more CSG development across the border in my home state of Queensland and in South Australia. We always need to make sure we have the right environmental approval processes in place for mining, processing and exporting our resources, including coal seam gas and coal. These approval processes should be driven by science, by thoughtful and logical policymaking and by respectful community dialogue.

It is important to focus on the scientific evidence before us. In my last speech on coal seam gas, approximately two weeks ago, I referred to a report by Mary O'Kane, the New South Wales Chief Scientist and Engineer. She conducted an independent review of coal seam gas activities in New South Wales. That report was released in September of last year and concluded that the risks associated with coal seam gas exploration and production can be managed. With an almost identical result, the Northern Territory's inquiry—recently conducted by Allan Hawke AC—found that the environmental risks associated with some of the more contentious practices can be managed effectively, subject to the creation of a robust regulatory regime. That report was finalised on 28 November last year.

At budget estimates last year, Dr Chris Pigram, the CEO of Geoscience Australia, made comments to the effect that the concerns around the practices employed by the industry are unwarranted and 'they do not represent a problem for the community by and large'.

I would also like to make reference to the Independent Expert Scientific Committee on Coal Seam Gas and Large Coal Mining Development. It was established by the former Labor government as a statutory body under the Environment Protection and Biodiversity Conservation Act 1999—which we call the EPBC Act—in late 2012. The committee consists of eight members with extensive scientific qualifications and expertise in the fields of geology, hydrogeology, hydrology, ecology, eco-toxicology, natural resource management and environment protection.

Under the EPBC Act, the committee has several legislative functions: to provide scientific advice to the Commonwealth environment minister and relevant state ministers on the water related impacts of proposed coal seam gas or large coalmining developments; provide scientific advice to the Commonwealth environment minister on bioregional assessments, including the methodology, research priorities and projects; and publish and disseminate scientific information about the impacts of coal seam gas and large coalmining activities on water resources.

The reports by Mary O'Kane and Allan Hawke are recent, credible and independent. Along with the advice provided by Geoscience Australia and the independent expert scientific committee, I would encourage all senators to make the most of this expert research and educate themselves on this issue.

Turning to the subject of coal: Australia is fortunate to be richly endowed with a world-class supply of coal—a commodity that is essential to modern life. Coal is the world's fuel of choice for electricity, accounting for 41 per cent of all generation, because it is reliable and affordable. Australia has the fourth-largest share of proven coal reserves in the world with 110 years of black coal and 510 years of brown coal. It benefits all Australians through its contribution to exports, wages, investment and tax revenue. It is Australia's comparative advantage in coal together with other mineral and energy resources, including iron ore, that has enabled Australians to sustain the longest period of continuous economic growth in the nation's history.

The Australian coal industry employs about 50,000 people directly and also provides indirect employment for around 150,000 Australians mainly in regional locations across Australia. Australia's coal economy represents 4.2 per cent of gross domestic product or almost $60 billion. Australia's coal industry makes a significant contribution to national, state and local economies through taxes, royalties and other charges.

Coal underpins Australia’s reliable and historically affordable electricity supply. Low-cost, reliable energy has been the cornerstone of Australia’s economic growth and high living standards for several decades. Black and brown coal comprise Australia's principal energy source, providing 75 per cent of our electricity.

There is no solution to global baseload power generation that does not feature a major role for coal. One only need look at the International Energy Agency for some support for that proposition. Coal is very important to baseload generation, and all suggestions that coal will not play a central role in the future are not supported by the International Energy Agency.

Even under the International Energy Agency's new policy scenario, which assumes all government promises on funding renewables and building nuclear power plants are implemented, coal consumption increases by around 17 per cent through to 2035, and there is little change in the global energy mix. Coal remains about 25 per cent or higher of primary energy demand—as it was in 1980 and has been for the past 30 years. This continues to be a 25 per cent part of the energy mix that will grow and, according to the International Energy Agency, by about 40 per cent over the next quarter century. It is important for Australia to be part of that market.

Coal fired power generation has assisted in lifting over 500 million people, principally in China, out of poverty and providing them with higher standards of living. Coal fired power generation heats homes, drives industry and makes life better for billions of people around the world. It is a critical part of Australia’s portfolio of export minerals. Of course we always need to make sure that we have the right environmental approval processes in place for mining and exporting our resources, including coal. We need to make sure that those processes are transparent.

Our coal performs an important function in the global market place. Our coal is better coal and burns cleaner, and is a highly-sought after coal. High-efficiency clean coal technology is important. Coal supports many of Australia’s regional communities and very many good jobs in the mining industry.

Whilst a Commonwealth ban on returning to coal seam gas would be meaningless, since we do not have a role in approving these projects, there is an important role for the Commonwealth to play. The Commonwealth needs to be working with states to, firstly, ensure that regulation in the industry is based on rigorous science, like the science provided by Mary O'Kane and Allan Hawke, rather than knee-jerk reactions; and, secondly, developing a harmonised and best-practice framework for CSG activity.

The federal government presently has environmental responsibility only if a project or activity has the potential to impact on matters of national environmental significance as defined under the EPBC Act and the Water Act.

Australia's national environment law, the Environment Protection and Biodiversity Conservation Act, was amended in June 2013 by Labor, to provide that water resources are a matter of national environmental significance, in relation to coal seam gas and large coalmining development. This means that coal seam gas and large coalmining developments require federal assessment and approval if they are likely to have a significant impact on a water resource. Proposals that have been assessed by the Commonwealth have only been allowed to proceed after careful consideration of the potential groundwater impacts.

In terms of CSG, on the last occasion that I made a contribution, I acknowledged the concerns that we heard in the Senate inquiry into certain aspects of the Queensland government administration. It is quite true that there were many landholders and their representatives who came before that committee providing evidence about treatment that they had received at the hands of some of the mining companies. I have been on record as saying—and I will say it again today—that, on occasions, those companies have not helped themselves in some of the inconsistent treatment that they have dealt to landowners in my home state of Queensland. One does need to ensure that a proper level of consultation and proper levels of regulation exist.

Nevertheless, global energy markets are being transformed by gas from coal seams, shale and tight gas. The use of CSG as an energy source is longstanding and accounts for 33 per cent of the eastern states' domestic gas production. For example, 95 per cent of gas used in Queensland comes from CSG. CSG powers a number of domestic electric generation projects throughout Queensland, including the Origin Energy operated Darling Downs Power Station and the Braemar 2 Power Station.

The policy challenge for state governments is twofold: to ensure the appropriate compensation of landholders for the access and use of their land, and to ensure that coal seam gas is exploited on behalf of their citizens, unlocking an important transition fuel, providing a source of employment and export income and generating a long-term revenue source through royalties and rents.

Coal seam gas exploration represents an immense opportunity for Australia, particularly regional Australia. LNG projects in Queensland's CSG-to-LNG industry are worth more than $70 billion and are responsible for almost 30,000 jobs. The policy challenge for the Commonwealth is to ensure more gas production and the best possible environmental protection.

This industry has created good, sustainable jobs, particularly in regional communities, boosted the economy at both the state and federal level and will deliver billions in government revenue. It will lift Australia's export income and provide state and Commonwealth governments with a significant source of revenue. As a cleaner alternative to coal fired power, LNG is an essential part of the global solution to reduce greenhouse gas emissions and provides many jobs and opportunities in regional Australia.