Sunday, 14 August 2011

Tony Abbott wedged over mines

Tony Abbott has backed the right of farmers to deny miners access to their land, intensifying pressure on the states to rein in mining that encroaches on communities and food production.

The Opposition Leader's call for farmers to have "a right to say no" comes as the main players in the emergent multi-billion-dollar coal-seam gas industry remain split over whether they should barge on to private property without consent.

But the risk for Mr Abbott of alienating big business and the key states of NSW and Queensland - which are increasingly dependent on coalmining royalties and the impending bonanza from CSG production - was reinforced last night when Labor accused him of jeopardising billions in investment.

The federal Resources and Energy Minister, Martin Ferguson, pointed out that two of the biggest operators in the CSG industry, Santos Ltd and Origin Energy, were Australian companies.

Mr Abbott found himself in the unaccustomed position of being backed by Greens leader Bob Brown, who applauded him for putting farmers' rights first.

"If you don't want something to happen on your land you ought to have a right to say no," Mr Abbott told Sydney radio host Alan Jones yesterday.

"Now, OK, under certain circumstances the governme
nt ought to be able to resume your land, but it's got to be done at a fair price."

While "reputable miners" would not intrude without permission, Mr Abbott said, "people are entitled to be concerned about any situation where miners are coming on to land against the wishes of landholders".

The managing director of the British-owned Queensland Gas Company, which is developing CSG projects worth $14 billion, this week left open the option of enforcing access rights over the objection of land owners. Catherine Tanna's evidence to a Senate inquiry contrasted with that of Santos, which insisted it would not override the landholder.

Neither company would comment further yesterday.

But The Weekend Australian has obtained notes of Ms Tanna's proposed evidence to the Senate rural affairs and transport references committee, which she was unable to deliver, that clarify her position. "While much has been said about the basic architecture of resource ownership, a fundamental principle of Australia's legal system is that the crown owns mineral and petroleum resources," she had intended to testify.

"Companies like ours are effectively invited to invest our money to extract resources on behalf of the state - and we pay a royalty for the privilege. This invitation comes with responsibilities and obligations."

Protests over land access by miners are gaining traction in the coal and CSG fields of Queensland and NSW as sky-high energy commodity prices drive a wave of expansion.

The anger is spilling into the city, with CSG extraction set for Sydney's inner west, and coalmining pressing on the outer suburban fringes of Brisbane.

Mr Abbott's intervention comes as NSW moves towards uniformity with Queensland on regulating the burgeoning coal-seam gas sector, having imposed a 60-day moratorium on issuing new CSG exploration licences.

This expired last month, but NSW will retain for the rest of the year a ban on the controversial CSG extraction process of hydraulic fracturing or "fracking".

Both states are heavily reliant on coal and CSG production to prop up their ailing budgets.
In NSW, coal royalties have ballooned from $200 million a decade ago to $900m for 2009-10, accounting for 90 per cent of all mineral royalties. Total royalties grew to $1.8bn in 2010-11.

Mr Ferguson said: "Given Tony Abbott's strong states rights position during the public discussion last year on the mineral resources rent tax, I am interested to know whether he has consulted with Premiers (Colin) Barnett and (Barry) O'Farrell over this proposal, given that coal-seam gas resources are state assets, consistent with our constitution."

The Queensland government is forecasting coal royalties of $2.75bn this financial year, up 20 per cent. With coal-seam LNG projects worth $30bn due to begin construction, business investment will surge by 27 per cent this financial year, according to the state budget papers.

Queensland-based Nationals Senate leader Barnaby Joyce welcomed Mr Abbott's support for farmers and said he hoped the ongoing Senate inquiry would help exert pressure on state governments to tackle infringements of their property rights by miners.

"What people on the land are finding is that someone can cut their fences and come on to their place and put down new roads and charge around, despite the fact that this is a property that's been bought and paid for," Senator Joyce said.

Queensland Premier Anna Bligh said recently the need to balance the preservation of farming land with mining development was behind new state "strategic cropping" legislation.

"We have always made mining the top of the hierarchy when it comes to best land use," she conceded. "We've made a decision that in some cases that's the wrong hierarchy and it will be protected forever."

Queensland Liberal Nationals leader Campbell Newman said Mr Abbott was "reflecting on the frustration of farmers who are pitched in a David and Goliath" battle with big business. He said failure by the state government to plan for the resources boom was to blame.

"The LNP is working to resolve these issues to make sure landholder rights are respected," he said. Macarthur Coal chairman and former Labor state treasurer Keith de Lacy said Mr Abbott should take a more balanced approach and not have a "knee-jerk reaction" to the land access issue.

Additional reporting: Ean Higgins, Andrew Fraser, Rosanne Barrett

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