Page: 6402
The PRESIDENT: Pursuant to sessional orders the question is: That the motion proceed forthwith.
Precedence agreed to.
The Hon. RICHARD JONES [2.40 p.m.]: I move:
That under section 41 (1) of the Interpretation Act 1987, this House disallows the Petroleum (Onshore) Regulation 2002 published in Government Gazette No. 135, dated 30 August 2002, pages 7333-7354 and tabled in this House on 4 September 2002.
I have moved this motion to disallow the Petroleum (Onshore) Regulation 2002 for a number of reasons. First, this regulation was the subject of minimal consultation and what comments were received in the less than two weeks during which it was examined by, for example, environmental groups seem to have been totally ignored. Environmental groups and others became aware of the revised draft regulation only after it appeared on the Department of Mineral Resources [DMR] web site on 23 August. Submissions were due by 9 August and an extension for submissions was refused. Despite this, I am aware that many concerns were expressed in submissions, especially about the industry self-regulation aspect of the regulation. It appears, however, that these submissions were totally ignored because there was no change to this part of the regulation in response to the many objections. No satisfactory explanation has been received as to why these submissions were ignored. Therefore, I would be interested to hear from the Minister how many submissions were received by the DMR in relation to the draft regulation and how they have been taken into account in the final regulation.
Second, this regulation fails to put in place adequate regulations to oversee the operation of petroleum mining on the land-based areas of New South Wales. The 2002 regulation effectively reinstates the measures in the 1997 regulation that, from the point of view of the environment, amount to industry self-regulation. The regulation adopts an industry code of environmental practice that can be weakened by the industry at any time. This is unacceptable as petroleum onshore exploration has potentially massive environmental impacts. Petroleum consists of both oil or crude oil, and gas or natural gas. Much of the exploration activity in the past has involved the identification of stand-alone deposits of oil and gas held below the surface in pockets. However, it has only recently been recognised that coal seams can act as a storage or reservoir rock for natural gas.
Coal has the potential to store as much as six to seven times more methane per unit of volume than most reservoir rocks. The coal seam methane gas is removed by extracting the water that is held with the coal, causing the pressure to drop. This water is highly mineralised, and is a potential pollutant. Thus coal seam methane exploration is very new to New South Wales, so the regulatory regime has not adapted to take this into account. But, more importantly, the impacts of coal seam methane exploration are far greater than the impacts of non-petroleum mineral exploration. Mineral exploration, by contrast, has a relatively low impact on the environment. Mineral exploration starts from small areas of collection and survey, usually over a vast area. As the exploration continues sampling becomes more targeted and intensive until the resource is proven. The main environmental impacts occur during the production and mining phase. The Government requires a full environmental impact statement at this stage.
Exploration for coal seam methane is much more destructive. However, current government practice is to delay a full environmental impact statement until the start of production. By then, most of the on-site impacts due to exploration have occurred. Over a large area, many survey programs would be conducted. Each survey program would typically consist of 50 kilometres or more seismic survey lines. These survey lines would need to be cleared to allow the passage of very large all-terrain trucks. It also involves the clearing of a network of large pads, each of at least one hectare, to construct a test well. The vegetation is usually completely cleared and soil is removed. The highly mineralised water extracted from the test well is placed in a holding dam near the well. When production begins large quantities of this highly salty water are generated. The test wells are usually spaced between 500 metres and one kilometre apart, each joined by a road. This not only destroys vegetation and animals during the initial vegetation clearance but creates a highly fragmented landscape and severely alters and disturbs the integrity of the habitat for native animals.
In summary, the main environmental impacts caused by coal seam methane exploration include vegetation clearance for drill sites and seismic surveys; groundwater loss and contamination; and production of wastewater, contaminated by dissolved mineral salts or organic compounds. Petroleum exploration is also relatively new in New South Wales and is becoming renowned for how fragrantly it disregards simple environmental practices. The administration of Petroleum Exploration Licence [PEL] 238 in the State's north-west is a case in point. PEL 238 covers 8,500 square kilometres of the Gunnedah basin, and the major part of it covers the entire Pilliga State Forest. It originally was issued in 1993 and expired in 1999, but was renewed in 2001 for five years until August 2007. The key resources sought in PEL 238 are conventional natural gas and coal seam methane gas. Eastern Star Gas Ltd holds 81.5 per cent of the interests in PEL 238. It is mainly concerned with exploring for conventional natural gas. The rights to coal seam methane gas have been subleased to First Source Energy.
First Source Energy Group, or Forceenergy—both owned by Gastar Exploration, a North American company—is carrying out coal seam methane gas exploration at a site within PEL 238 named Bohena, which is at the northern end of the Pilliga, next to the Newell Highway, and about 30 kilometres south of Narrabri. Unfortunately, the operation of the Bohena exploration program is a severe example of poor mining company practice and inadequate DMR regulation. Conservationists visited the Bohena wells on Sunday 18 February 2000 and discovered an area of dead, leafless ironbark trees along the southern edge of the Bohena No. 2 drill site. Gas—probably methane and/or carbon dioxide under high pressure—was escaping to the atmosphere from a flare pipe at No. 3 drill site. Very hot saline water, apparently from an underground artesian reservoir, was being transferred from this location to an earth dam at the No. 4 drill site. Several apparently abandoned drill sites contained unlined earth dams with saline water of various colours, ranging from milky green to jet black. On Sunday 18 February 2001, a visit was made to the Bohena site, where the 12 drill holes were inspected. At drill hole site Bohena No. 2 an area of dead, leafless ironbark trees was discovered along the southern edge of the site, which, in common with all the other sites, consists of a bulldozed and cleared area of about one hectare.
I shall outline the apparent sequence of events at this drill site. First, in 1999 an unlined earth dam or settling pond was constructed, with a spillway in the north-eastern corner to drain off excess salty water into the surrounding forest. It is in the catchment of Bohena Creek, a tributary of the Namoi River. Second, some time in late 2000 there was heavy rainfall and the dam wall was overtopped and then collapsed. A saline fluid poured into the forest at the southern edge of the site. This formed pools up to 10 to 15 centimetres deep, as can be seen from oil marks on tree trunks. A thick, black oily scum was observed on the ground. The vegetation, including large ironbarks, was killed. Third, early in 2001 or late in 2000 the dam wall at Bohena No. 2 was raised to increase the capacity of the holding pond. At no stage was any attempt made to clean up the black oily scum, and oily pools were still lying on the surface of the ground in February this year.
Several apparently abandoned drill sites contained unlined earth dams with saline water of various colours, ranging from milky green to jet black. Most were probably saline. Flocks of small birds were often seen drinking from these pits. The National Parks Association of New South Wales [NPA] reported the spill to the Environment Protection Authority [EPA]. The EPA subsequently reported to NPA that the black liquid was decaying vegetation, most likely from dying trees. The authority confirmed that the dam wall failed and made a series of recommendations. These recommendations included further testing of the soil where the trees died so that a rehabilitation program and tree planting can occur, and the revision of the mining company's water management strategies. The EPA was keen to see DMR perform better regulation of the exploration at Bohena and to review its exploration guidelines.
During 2001 a copy of the Review of Environmental Factors [REF] was sought from DMR. This is the document that satisfies the requirements of the Environmental Planning and Assessment Act that describe the nature of the works to be conducted and show that the activity will not cause a significant environmental impact. The request for the REF was made to the Resource and Conservation Assessment Council, but it still was not forthcoming. Narrabri Council finally wrote to the NPA in October 2001 saying that the REF could be viewed at the front desk of council offices and that a copy would not be provided. Local conservationists were forced to go to Narrabri, where they photographed the REF. They then typed up the document and distributed it to other people. If one wants something, the standard ploy from the DMR is, "It is confidential and you can't have it without permission from the company." The standard ploy from the company is, "It is confidential and you can't have it without permission from the department."
There was little change to the site during 2001: the area of vegetation killed by the dam failure was rehabilitated and a barbed-wire fence was erected around the drill site. By December 2001 there was evidence of extensive leaking from dams at Bohena No. 2 site and to other sites at Bohena, leading to the insidious spread of highly mineralised liquid through the subsoil and shallow aquifers. In January 2002 the NPA reported to the EPA that there was evidence of ongoing seepage of saline water from all the holding dams at the Bohena site, which is contaminating the soil and surface waters and continuing to kill vegetation. The unlined storage dams were clearly not effective in preventing contamination of the surrounding environment with highly saline water.
The water also could contain other toxins such as metals and petrochemicals, as other studies have shown in the United States of America. Local sandy soil also helps seepage of dam water through shallow changes. Later in 2002 it was discovered that some native tree planting of cleared areas in the Pilliga State Forest at the Bohena site had occurred. Unfortunately, the species planted were not native to the area and included some invasive native species. Earlier this year about 40 kilometres of new seismic lines were tested in the Bohena site by Eastern Star Gas. Petroleum exploration is continuing in a range of areas in the vicinity of the Pilliga State Forest. I move:
That this debate be adjourned until Tuesday 18 November.
Motion for adjournment negatived.
The Hon. EDDIE OBEID (Minister for Mineral Resources, and Minister for Fisheries) [2.51 p.m.]: The Petroleum (Onshore) Regulation 2002 contains provisions that give operational effect to the Petroleum (Onshore) Act 1991. The motion would cause loss of much of the Government's ability to regulate the petroleum industry in onshore New South Wales. I am surprised that the motion has been moved. If it were passed it would throw into doubt the grant of new petroleum titles in New South Wales and lead to a loss of investor confidence across the industry. It would also lessen the Government's capacity to ensure sound environmental outcomes within the industry. The Petroleum (Onshore) Act provides for the grant and management of all petroleum exploration and production titles across onshore New South Wales. The Petroleum (Onshore) Regulation has been in existence essentially in its current form since 1992. The Petroleum (Onshore) Regulation 1997 lapsed on 1 September due to the staged repeal requirements of the Subordinate Legislation Act 1989. Consequently, the Government developed a replacement regulation, the Petroleum (Onshore) Regulation 2002.
The necessary regulatory impact statement was prepared, and the draft regulation and accompanying regulatory impact statement were put on public exhibition on 19 July. Submissions received were taken into account. The new regulation, which was gazetted on 30 August, contains only two amendments of any significance. The first is based on a recommendation by the Regulatory Review Committee and the second is consequential to amendments to the Justices Act 1902. The regulation contains mainly machinery provisions that deal with administering titles, providing important information about exploration activities to the Government, and setting levels for fees, royalties and penalty notices. Although the provisions are generally machinery in nature, they are crucial to the efficient administration and effective environmental management of petroleum titles in New South Wales.
If the regulation is repealed it is likely that applications for petroleum titles cannot be validly lodged and, therefore, they cannot be granted. Fees and royalties could not be collected because there would be no set rates. Penalty notice offences could not be issued. These consequences would mean that petroleum titles already granted would be subject to a lesser and inadequate standard of management, including environmental management. There are also mine safety implications. Activities carried out under petroleum titles will no longer be subject to the Government's schedule of onshore petroleum exploration and production safety requirements. The Mining Warden will not be able to assess amounts of compensation payable by petroleum titleholders to land-holders. There is also a native title impact. The four-month period given to representative Aboriginal and Torres Strait Islander bodies to search for and identify native title claimants will be lost. It would be reprehensible if the New South Wales Government could not grant exploration titles to new entrants to the industry, or could not administer responsibly the existing onshore petroleum titles.
I understand that the motion of the honourable member is based, in part, on the fact that the regulation also makes compliance with an industry code of environmental practice a condition of all petroleum titles. However, it should be noted that the application of the code is not a major part of the comprehensive suite of environmental management provisions applying to the petroleum industry. The principal environmental management provisions applicable to the petroleum industry are in other statutes and conditions of title, and other approvals. For example, the Petroleum (Onshore) Act 1991 contains important provisions about environmental offences and penalties, security deposits, protection of the environment and rehabilitation of affected land. All petroleum titles also have specific conditions of title designed to protect the environment and ensure rehabilitation. All petroleum exploration activities fall under the coverage of the Environmental Planning and Assessment Act 1979.
Environmental impact assessment under that Act is required before any exploration or production title can be granted. In addition, all the other environmental protection, planning and conservation legislation of the State applies to petroleum prospecting and production operations. Reference to the code of practice has been in the regulation for the past 10 years. It was first included by the Coalition Government in 1992. Other States and Territories also apply this code of practice in a similar fashion to the regulation. The current requirement should be seen as simply a small element in a comprehensive suite of environmental management provisions applying to all petroleum titles in New South Wales.
The Hon. DUNCAN GAY (Deputy Leader of the Opposition) [2.56 p.m.]: The Opposition opposes the disallowance motion moved by the Hon. Richard Jones, which seeks to deregulate a strictly regulated industry. If passed it would effectively leave a range of operations associated with onshore petroleum exploration without overarching guidelines in which to operate. I wonder whether the Hon. Richard Jones took that into account before he moved this motion. He is seeking to disallow a major regulation, yet he is unable—not through any fault of his own, I suspect—to propose an alternative regulation. I acknowledge that there is an argument that regulation of petroleum exploration should fall under the Environmental Planning and Assessment Act 1979.
But, in the short term, the passage of this disallowance motion would leave the onshore petroleum exploration and extraction industry deregulated in some key areas. The Petroleum (Onshore) Regulation contains several important provisions dealing with plans and works programs for petroleum titles, reports to be furnished with respect to petroleum exploration activities, compensation to persons affected by petroleum exploration activities, the appointment of agents, fees payable under the principal Act, and rates of royalties payable on petroleum. In addition to those provisions, the regulation also formally adopts two key codes of practice: the code of environmental practice for onshore operations published by the Australian Petroleum Production and Exploration Association [APPEA] as well as the schedule of onshore petroleum exploration and production safety requirements published by the New South Wales Department of Mineral Resources.
I suspect that what the honourable member is attempting to do cannot be supported because he is seeking to knock out an entire regulation with no acceptable alternative, apart from a vague suggestion that the regulation of petroleum exploration be carried out under the Environmental Planning and Assessment Act. The works conducted by petroleum and exploration companies are generally carried out in a manner consistent with best practice. Exploration and extraction companies can no longer get away with wholesale environmental degradation. I have seen some of the examples of companies rehabilitating work sites when they are finished their exploration or extraction activities.
The Hon. Richard Jones circulated a briefing note about this disallowance, claiming that exploration works may result in clearing and soil removal over an area of at least one hectare. While that may be the case, companies are now well aware of their responsibilities in undertaking rehabilitation work. It is no longer a case of a company simply finishing what it is doing and leaving a site as it is after works are complete or when the useful life of a site is over. That just does not happen. Within this regulation there is a part which, if disallowed, would have a net impact of effectively halting responsible petroleum exploration and extraction right across the State. I suspect that is the ultimate aim of the Hon. Richard Jones in moving for the revocation of the regulation.
The Hon. Richard Jones: No, it is not.
The Hon. DUNCAN GAY: The Hon. Richard Jones says that is not true, but I think that every honourable member of this House knows what he is about and that what I have said is pretty much the reality. Part 2 of the regulation—the part that was specified in the original disallowance motion—deals with applications for petroleum titles, notification of proposed exploration activities and several other matters. The impact of a successful disallowance would be to call into doubt the validity of petroleum titles and would subject a range of activities to a lesser form of regulation. It is my understanding that in July the Department of Mineral Resources conducted a consultation process on this regulation and requested comments or concerns to be lodged with the department by 9 August. I also understand that the only objections to the regulation came from environmental groups who are opposed to the Australian Petroleum Production and Exploration Association [APPEA] Code of Practice. Apparently these concerns stem from a belief that the code relies too heavily on self-regulation. I have contacted the APPEA to discuss this regulation, its code of practice and concerns raised about the code. In response the APPEA's executive director, Barry Jones, stated:
The Australian Petroleum Production and Exploration Association has been advised that the Petroleum (Onshore) Regulation 2002 is currently before the parliament. APPEA is recognised nationally and internationally as the representative body of the oil and gas production and exploration industry in Australia. APPEA seeks to promote a competitive basis for the development of Australia's oil and gas resources while maintaining the highest standards of safety, health and environmental management. It has come to our attention that a member of the NSW Parliament is seeking to disallow the entire regulation on the basis of its reliance on the APPEA Code of Environmental Practice. The regulation covers not only environmental requirements, but also titles and licences. It is clear that, without a regulation in this area, all petroleum activities in New South Wales will have to cease, causing severe disruption not only to operators, but to the public as well.
I suspect that the Hon. Richard Jones would not care about that. That is the view of a respected and important industry body—a body that contributes heavily to environmental regulation in this industry. It appears to the Opposition that the primary motive of the Hon. Richard Jones in moving to disallow this regulation is to halt exploration activities in the Brigalow Belt Bioregion. Frankly, that sole motive simply cannot be supported. I have also consulted companies involved in exploration and extraction activities in New South Wales. The Managing Director of Eastern Star Gas Ltd, Mr Dennis Morton, informed me:
We note that no alternative mechanism has been proposed as part of his motion. We consider the proposal to be mischievous and of no purpose. The Brigalow Belt Bioregion South Assessment is nearing completion and we believe it is likely that Richard Jones is trying to pre-empt that process by debate in the House to thus control the matter.
The Hon. Richard Jones: That is not true.
The Hon. DUNCAN GAY: The Hon. Richard Jones says that that is not true, but I suspect that just about every honourable member of this House—and I notice nodding by members of all parties—believes that what I have said is indeed the case. The message is clear: the Hon. Richard Jones is seeking to jeopardise major employment and investment opportunities in rural and regional parts of the State—parts of the State that could do with every job and every dollar they can get during this time of drought. In doing so, he is seeking to deregulate a regulated industry. One wonders what the logic is behind that.
The Hon. Tony Kelly: Environmental anarchy?
The Hon. DUNCAN GAY: Exactly. It is counterproductive. The Executive Director of the New South Wales Minerals Council, John Tucker, states:
The disallowance motion seeks to put at risk a well established regulatory regime of general application across the State in order to bring pressure on the Brigalow assessment process outside of the established mechanisms. As such, this disallowance motion is a crude and blunt instrument that would set a terrible precedent and must be defeated.
They are good words and I think he stated the position pretty well on behalf of most people. This is an ill-conceived disallowance motion that offers no real alternative. The passing of this motion for disallowance will effectively shut down a major industry in New South Wales and will also halt future works on exploration across large parts of the State. There can be no sensible rationale for simply disallowing a major regulatory tool for an industry that needs guidance in its operations. The Opposition opposes the motion for disallowance in the strongest possible terms.
Ms LEE RHIANNON [3.06 p.m.]: I participate in this debate on behalf of myself and Mr Ian Cohen to support the motion moved by Mr Richard Jones for disallowance of the Petroleum (Onshore) Regulation 2002. We support Mr Richard Jones and congratulate him on the motion he has moved. I am concerned about the number of outlandish and quite irresponsible statements made by the Deputy Leader of the Opposition, especially that the disallowance of this regulation will jeopardise regional employment opportunities.
The Hon. Duncan Gay: Every time you name me, my vote goes up.
Ms LEE RHIANNON: As legislators, we have to create the right mix between environmental protection and lasting, meaningful jobs, not jobs that will destroy the environment, yet this State has this really dodgy regulation. I say that because the regulation adopts an industry code of environmental practice that can be weakened by the industry at any time. Again the Deputy Leader of the Opposition has done a beat-up, which he is keen to do because, as he has just said, he is seeking to increase his vote. Why can he not act responsibly in this matter?
The Hon. Duncan Gay: I get my vote up when you name me. You just have to keep talking.
Ms LEE RHIANNON: Why can he not act responsibly and recognise the importance of providing jobs without creating environmental destruction? Numerous anecdotes show that self-regulation of petroleum exploration activities is not good enough, nor is a code which allows the industry to weaken practices or change them whenever it wishes. That is why, on behalf of the Greens, I congratulate Mr Richard Jones on moving the motion. The Greens will be pleased to support it.
The Hon. RICHARD JONES [3.08 p.m.], in reply: The Deputy Leader of the Opposition has misled the House by suggesting that the idea of moving the motion was to stop the assessment taking place on the Pilliga. This motion has nothing whatever to do with that. However, it is true to say that Eastern Star Gas Ltd is having some impact in some important areas. For example, the company has five exploration test wells at the Coonarah site, which is 20 kilometres south-west of Narrabri. Eastern Star Gas Ltd presented its Coonarah project proposal to government departments in August 2002. Coonarah is estimated to contain 11.3 petajouls [PJ] of gas reserves. With the initial production to be about 1 petajoul per year, the project will have a life of 10 years. Gas will be piped to Narrabri in 20 kilometres of buried 17-centimetre steel pipeline. It is proposed that the pipeline will cut through a small remnant of brigalow, an endangered plant community—one of the few remaining in the area. The Coonarah field will power a gas-fired power station that will be constructed by Country Energy.
[Interruption]
Upstairs I have a satellite map of the whole of New South Wales—a picture that was taken two weeks ago—that shows just how much bushland in that area is left. Only a bit of scrub in the Pilliga area is left. The former Coalition Government cleared the rest of that area. I will show that map to those Opposition members who have not seen the area. They should have a look at the map, which shows the appalling damage that has been done in the last 20 years. It is unbelievable. The map shows the areas that have been cleared. The former Coalition Government is responsible for doing a great deal of damage to that area. Opposition members who are now whingeing and who want hand-outs have virtually destroyed that area.
The five test wells should be sufficient to extract the known gas reserves by converting them to production wells. Despite the fact that most on-ground impacts have already occurred, an environmental impact statement [EIS] would most likely be required prior to production. However, no date appears to be set for any EIS at this stage. Eastern Star Gas is continuing to explore for natural gas in the Pilliga. In May 2002 it announced that it had collected information from over 56 kilometres of seismic lines in an area about 10 kilometres south of the Bohena site. One line was a cleared path of at least three metres wide that passed through Broombush—optimal habitat for the threatened Pilliga mouse and something about which Opposition members would not be aware.
Wilga Park No. 1 well was drilled in 1985 by Hartogen Energy Ltd. As the Department of Mineral Resources [DMR] publication "Minfo" reported, "subsequent production testing found that the gas accumulation was of limited extent with small reserves". Despite that, various documents about the resource in the Narrabri area continue to include Wiliga Park as part of the significant petroleum resources in the area. Given the potentially large environmental impacts from petroleum exploration, one would think that the industry regulator, DMR, would have in place a strict regime to mitigate environmental impacts. Unfortunately, DMR's dual role of being a mining industry advocate and a mining industry regulator appears to result in a poor performance as a regulator.
The Petroleum (Onshore) Regulation 2002 is a perfect example of that. For environmental protection the regulation relies on the Australian Petroleum Production and Exploration Association code of environmental practice. That 1996 document is described in the code as "a comprehensive check list to be considered when conducting petroleum exploration and production activities". It is a critical part of the association's attempt to achieve industry self-regulation—something that I am sure Opposition members support. Unfortunately, the code is weak on providing specific regulations governing petroleum mining. For seismic surveys where many long tracts of vegetation may be cleared, environmental impact assessment is discussed but it is not obligatory.
A number of important design considerations are also listed for things such as avoiding sensitive areas. The code is full of terms such as "should", "consider”, "where practicable", "may include", "take into account", or "special procedures may be required to protect significant wildlife populations". Careful procedures for seismic surveys are only "considerations" and training "should" be conducted. There is limited opportunity for community input and no requirement for independent monitoring of any clean-up or restoration work that may or may not take place. Even if the code is made binding by the Petroleum (Onshore) Regulation, because it consists mostly of guidelines and suggestions it has little practical effect on regulating petroleum mining.
Thus the DMR has effectively abrogated responsibility for environmental control of land-based exploration in New South Wales and allowed self-regulation of the oil industry. That is made even worse by the fact that the code may be weakened at any time by industry. Clause 25 of the Petroleum (Onshore) Regulation refers to the 1996 code but allows it to be amended from time to time at the whim of industry. The DMR requires no consent or consultation before a new code is prepared. A weak code can, therefore, become even weaker without any government intervention. That point was raised in a letter written last month by Premier Bob Carr to the Total Environment Centre. The Premier said:
I refer to your letter of 8 August 2002 in which you express concerns about the Petroleum (Onshore) Regulation 2002.
The Petroleum (Onshore) Regulation 2002 was introduced to replace the Petroleum (Onshore) Regulation 1997, which was due for automatic repeal. The 2000 Regulation carries forward existing regulatory requirements in relation to the conduct of mining operations. In this sense there is no change to the environmental regulatory regime.
What is of note, however, is your concern that the Australian Petroleum Product and Exploration Association's Code of Environmental Practice Onshore, which is part of the framework, appears to be capable of being amended by the industry without reference to the Government.
I have therefore asked the Minister for Mineral Resources the Hon. E M Obeid MLC to consider the content of the Code and the arrangements and protocols for amending it, and to advise whether there is any risk of unilateral change that could have the effect of inappropriately weakening environmental management of mining activities.
That statement about the Minister for Mineral Resources was made by the Premier in a letter to the Total Environment Centre—a letter about which the Minister is aware. That letter indicates that the Premier asked the Minister "whether there is any risk of unilateral change that could have the effect of inappropriately weakening environmental management of mining activities". The answer is yes. The industry association can at any time weaken environmental management of petroleum mining unilaterally. However, that is not all. The Petroleum (Onshore) Regulation will also provide little incentive for compliance even if parts of the code are found to be enforceable.
The maximum penalty for any offence under the regulation, such as leaving an unsafe or polluting drill site or disobeying the instructions of a departmental officer, is a mere $5,500. When many hundreds of thousands of dollars or more are being spent on each exploration program there will be a large incentive to cut corners at the risk of a petty fine, if it is ever issued. Such a fine is never issued in the case of land clearing. Some people might attempt to defend the use of the code of environmental practice by stating that the regulation does not provide principal environmental management for the petroleum industry in New South Wales, but the Petroleum (Onshore) Act and the Environmental Planning Assessment Act do. Nothing could be further from the truth.
Neither of those Acts provides any meaningful environmental management for the petroleum industry. In fact the Petroleum (Onshore) Act 1991 is effective at overriding environmental conditions that may be imposed on a mining operation by a consent authority. While sections 74 and 75 require the Minister to take into account the conservation aspects of the environment, they also allow the Minister to totally disregard environmental conservation. The Environmental Planning and Assessment Act is not much better. Petroleum exploration is not considered to be covered by the requirement to prepare an environmental impact assessment under part 5 of the Environmental Planning and Assessment Act.
That is despite the fact that, when a five-year exploration licence application for coal seam methane gas exploration is approved, hundreds of kilometres of seismic survey lines and massive networks of test well sites, each one hectare in size, are effectively permitted and the collection of large volumes of saline waters where no disposal method has been determined is allowed without any environmental oversight. It is clear that the regulation must be disallowed and replaced by a new regulation that addresses all those issues. We should not be forced to rush through a flawed and ineffective regulation just because it was introduced days before the 1997 regulation was due to expire. The current regulation is effectively useless as far as the environment is concerned. It is better to get it right now rather than wait another five years.
Motion negatived.