By ERWIN CHLANDA
A panel session on fracking this week, before 500 NT cattle men and women at their annual meeting in Alice Springs, has put into sharper focus how the controversial oil and gas production method will further evolve in the NT.
The industry will continue to rely on what it calls its record while their assertions seem to be partly untested.
The integrity of ground water protection is claimed to be “not negotiable” while there was no assurance that the fracking process is fail proof.
And the NT Government is relying on the petroleum industry to set the production and safety agenda because to do otherwise would be “to legislate for a minimum standard”. NT Mines Department CEO Ron Kelly (above, right), who made this claim, did not substantiate it.
The session started with Matthew Doman being given the word from the floor. After eight years with Santos he became the SA/NT director for the Australian Petroleum Production & Exploration Association (APPEA) last month.
“We point to 60 years of activity now, not very far from here … 3000 wells have been drilled, 1000 wells have been hydraulically fractured, every one of these wells has gone through the Great Artesian Basin,” he said.
“There has been no impact on the viability, on the environmental viability of that critical ground.”
Clearly he should have said “known impact”: There was no evidence given to the meeting that all wells had been examined, from top to bottom, by independent experts, and that water samples had been analysed by them. On the contrary, according to one expert panel member, to date well inspection has not been happening (see below).
In August 2014, when Mr Doman was still with Santos, he told an Alice Springs audience that Santos does not claim to be perfect. Environmental incidents are listed on documents which are in the public sphere, he said. These are “typically spills of liquids”.
To Friday’s cattle industry audience he said: “The concerns we’re hearing today are very common and very reasonable and very legitimate and the industry has to do better in responding to those concerns. We’ll listen to you guys.”
What effect that listening would have was not made clear by Mr Doman but he claimed the industry is “very safe, very sustainable, very necessary”.
A woman in the audience asked: “What ramifications, if any, do you see for an industry that’s producing clean, green, organic beef if [gas and oil] well integrity is compromised or breached?”
Panel member John Cotter, chairman of the Gasfields Commission in Queensland, replied: “The starting point is, a threat to water is not negotiable. Absolutely not.”
He continued: “The process of drilling a well in Queensland is four times more stringent than drilling an agricultural bore. We have some great discussions going on in Queensland at the moment.”
These discussions possibly circle around the fact that not too many agricultural bores are drilled with the purpose of injecting poisons into the ground.
That ground water protection is indeed “negotiable” was underscored by Tina Hunter, Reader in Energy Law at the University of Aberdeen, who referred to “response plans, oil spill response plans”.
She said: “The biggest weakness in any framework in Australia is the fact that we don’t inspect wells and I think it is appalling.”
According to Mr Kelly, the Mines Department currently has seven specialist staff for the entire NT overseeing and inspecting oil and gas production.
Says Dr Hunter: “If a well leaks then you have major issues in the aquifers.
“If I was an organic producer I’d be concerned about chemicals coming on [to the land where drilling takes place] and how they are being regulated. What if they spill on the surface?”
Dr Hunter (at left) said spills would need to be contained. She suggested to talk to NT Work Safe about that “because a lot is about prevention, not response”.
Panel member Kelly made it clear that the NT Government regulator would be playing catch-up and that regulations were very much a work in progress although fracking is already in use and pretty well all land of the NT is under application or approval.
“There is a complete philosophical shift in how we regulate this industry, from sitting down and dreaming up a rule book … to looking at what are the potential dangers and risks and how do we deal with them,” Mr Kelly told the meeting.
“We are implementing a regime here where we do test all of our wells in their construction phases … to ensure cementing is done correctly, they are all pressure tested correctly, so we don’t have potential contamination of process water into the environment through a well failure.
“The onus is on the companies to do the research and the science and present it to us,” he said.
“The government people we have will have the ability and capacity to analyse that and ensure it is safe and correct, or will engage external experts to do that analysis and review.
“As a government regulator we are not telling people what to do because what we would then be doing is to legislate for a minimum standard.
“At the moment we are in an exploration phase.”
Dr Hunter came to the rescue when the enormity of the departmental task – checking thousands of wells under construction or in use – became obvious.
There’s lots of ways you can test, said Dr Hunter: “It’s like when you’re sick.
“There are lots of ways to get a diagnosis. Usually they start mucking around with X-rays. Then they might go to an ultrasound. And then they might do a CAT scan and then say, Oh, we need an MRI. What we should be advocating is best practice.”
Friday’s meeting was given no insight into how the NT Government would be dealing with the critical issues, although Cattlemen’s Association president Tom Stockwell had asked for exactly that four hours earlier.
Said Dr Hunter: “It’s about companies not cutting corners and regulators that are well resourced, well staffed and well funded. It’s about making sure your regulator can do it.”
“I think you need to talk to the Treasurer to give me more money,” quipped Mr Kelly, and then withdrew the remark.
He said: “When a well is in production the companies are monitoring and maintaining that well because it’s in their interest to make sure it’s operating correctly.
“We have immense confidence that we can get that regulatory regime right.”
Meanwhile the NT remains littered with the debris of failed mining ventures and bankrupt companies, waiting for the government to spend millions of dollars fixing up the environment (see also comment by ALEX NELSON).
Mr Kelly said the department will put in place an “environmental bond process” whereby companies will “pay up front, cash or unrestricted bank guarantee so Territorians are not exposed to financial or environmental risk”.