Less environmental scrutiny of CSG drilling under new rules - EDO NSW

Less environmental scrutiny of CSG drilling in NSW under new rules

By Senior Policy and Law Reform Solicitor Nari Sahukar

6 August 2014

Fewer new coal seam gas (CSG) wells will require a full environmental impact statement under amended NSW Government regulations.

The immediate effect of this amendment appears to reduce the environmental assessment and public consultation requirements for the Gloucester Gas Waukivory Pilot Project. This is despite community concerns that the hydraulic fracturing, or ‘fracking’, of CSG drilling wells up to 1,000 metres deep could have serious environmental consequences, including on fresh groundwater resources.

Countryside near Gloucester by Dean Sewell courtesy of Groundswell Gloucester

Since 2011, ‘drilling or operating petroleum exploration wells’ (including CSG) is classed as State Significant Development (SSD) – with some exceptions. All SSD proposals require an environmental impact statement (EIS) alongside a development application. This EIS requirement (which also applies to CSG production) was introduced due to concerns about inadequate assessment and transparency of CSG activities (see examples in this EDO NSW report). One exception to the EIS requirement is where a set of up to five CSG wells is proposed, more than 3 km from any other existing wells in the same petroleum title area (the five wells/3km rule).

 Instead of simply measuring the closest distance between a proposed new well and an existing well, amendments to State Environmental Planning Policies (SEPPs) on mining and major projects, now require the 3km to be measured from the “geometric centre” of the set of proposed wells to the nearest existing well. This change effectively extends the 3km minimum distance which is the trigger for new wells to require an SSD application and an EIS See the diagram below.)

New wells which fall outside the redefined ‘five wells/3km rule’ will only require a small scale ‘review of environmental factors’ (REFs). There are numerous problems with this type of environmental assessment including a lack of transparency (REFs are not published until after the activity is approved), risks of inaccuracy, limited government oversight, and no public consultation process (as distinct from EISs, which must be exhibited for 28 days). This is why the Government introduced the EIS requirement for CSG exploration in the first place.

The new regulatory changes follow a November 2013 letter of complaint to the Office of CSG from EDO NSW, on behalf of a local community member, about compliance with the ‘3 km rule’ at the Gloucester Gas Waukivory Pilot Project. As proposed wells for this project were understood to be within 3km of other existing wells, a plain reading of the provisions would have required an EIS to be prepared and exhibited. EDO NSW received no substantive response to this query. Instead, new SEPP amendments were exhibited – which measure 3km from the ‘geometric centre’.  As a result of the rule change, we understand it is likely that the Waukivory Pilot Project (and future projects in the same situation) would no longer require an EIS.

EDO NSW opposed the new definition of the ‘five wells/3 km rule’ when the changes were exhibited for two weeks in July 2014. We argued for a clearer, plainer and more conventional reading of the 2011 SEPP. This would give communities and proponents clarity on when an EIS is required, and give effect to the intent of the strengthened assessment requirements enacted in 2011.

Another problem with the new rule is that the ‘geometric centre’ is not defined, and the equations for determining it can be complex, making the community’s ability to independently assess this more difficult.

This added complexity and reduced scope for EISs limits public input, transparency, clarity and oversight of new CSG developments at a time when such projects are highly contentious and their environmental effects uncertain. Against this backdrop, any advantages of the ‘geometric centre’ approach are not made clear.


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