Social & Economic Impacts

Concerns about landholders not getting adequate advice

CSG Companies have been approaching landholders to enter into  “conduct and compensation  agreements”, but many landholders are unaware of the critical importance of these agreements and are not seeking legal advice in their negotiations with the CGS company.  Unbeknownst to many landholders deals made with CSG companies lie with the land and bind all future owners. BSA has concerns about the numbers of landholders who signed agreements without independent legal advice. 
CSG companies have the legal right to access to mineral resources underground while the landholders have the right to the surface land (and water). Please note however that these companies have statutory obligations to minimise their impacts on landholders and to avoid unreasonable interference with landholders’ existing lawful activities. CSG companies, with government authority, approach landholders to gain access to their resource. Landholders can not refuse access unless they have a reasonable excuse for doing so.  (A reasonable excuse would presumably be where their intended conduct would be in breach of those statutory duties and landholders need to forewarn CSG companies about unacceptable impacts or activities.)

The CSG company must consult with the landholder and avoid unreasonable interference with the landholder’s activities. This consultation is the landholder’s opportunity to make sure that impacts are minimised and unreasonable interference avoided.

Check out the BSA information sheet for landholders >>COMING SOON

Read about the Llyod Family’s experience >>

Inadequate Land Access Laws

In 2010 new land access laws were introduced by the Queensland Government.  These are said to be “standard” agreements and are said to have involved landholder consultation.  BSA is firmly of the view that landholder representations were largely ignored in this process and the documents are not “standard” nor have they been approved by landholder groups.  AgForce withdrew from the relevant processes because of the lack of attention paid to landholder representations.  Whilst BSA welcomed the introduction of some of the new laws and procedures, they are still problematic – especially because of the time pressure landholders are now under to reach agreement.

If an access and compensation agreement cannot be negotiated within 40 business days, the CSG company can apply to take the landowner to the land court and is granted compulsory entry 10 days later. Once this happens CSG companies can march onto a property and in theory do whatever they wish providing it is within the legislation (and no doubt subject to the statutory obligation). This could potentially mean a series of wells, pipelines or other major infrastructure could proceed while awaiting land court determinations.  In some cases this can take many months.  According to the Qld Department of Justice and Attorney General 2009/10 Annual Report in 2009/10 only 38% of cases introduced to the Land Court were finalised within 12 months.

The new land access legislation now allows for a mediation process if an agreement cannot be reached within 20 business days of the initial meeting.  The mediation process is a step forward but two things about this process concern BSA.
The first one is that the mediators are mining registrars who would have a very good understanding of mining law, but very limited understanding of CSG impacts and financial costs to the farming business.

The second one is landholders cannot have legal representation when trying to negotiate an acceptable access agreement unless the gas company agrees. This puts most landholders at a tremendous disadvantage because the gas company representative is often a trained negotiator having access to their own in-house legal representatives, and may very well have legal qualifications themselves.

It is also unclear yet as to what happens with the legal costs in this entire process.

Legal costs and stress

BSA believes it is critical that landholders seek their own independent legal advice when being approached by CSG companies.  The CSG company access and compensation agreements are complex and require vast amounts of time, research and legal knowledge in order to traverse. The legislation currently requires the CSG companies to pay "accounting, legal or valuation costs reasonably incurred by the landholder to negotiate or prepare a Conduct and Compensation Agreement".

However, costs associated with resolving disputes may not be required to be covered by the CSG companies.  BSA believes it is unfair that innocent landholders who did not have the option to say no to this industry may now be faced with unexpected legal costs.
BSA has case studies of landholders feeling pressured and caught off-guard – signing documents without legal advice and now regretting their actions.

Organic farming operations / Biosecurity

Landholders’ fear that their products and marketability could be compromised by CSG activity – costing them money and damaging their reputation and that of their industry.  For example organic farmers risk losing their accreditation status if their properties are compromised. This has been the experience of primary producers in Canada (link to surface rights paper).

Conflicts of Interest

BSA is very concerned that landowners have a lack access to professional services due to conflict of interests. Many solicitors, banks, land valuers and other consultants cannot provide services to landholders because they are already working for or representing CSG companies.  This has caused great frustration with landholders who feel in some cases they cannot get an unbiased opinion on matters such as land value.

EIS process – time and disclosure

Before projects commence, CSG companies are generally required to formally set Terms of Reference, and then in some cases they have to develop an Environmental Impact Assessment and/or obtain an Environmental Authority.  The Environmental Impact Statements (EIS) and Environmental Authorities (EA), are then made available for public comment. BSA objects to the way in which many of the CSG companies advertise these EIS and/or EA submission periods.  In many cases these are advertised once in the newspaper – rather than writing directly to affected landholders.  The time periods for making submissions are also a great concern.  There have been as little as five days to respond.

The language used in EIS/EA notices can be misleading, using broad terminology and inadequate mapping.  So it’s sometimes the exact location of the project is unclear.

The EIS and EA documents are often very lengthy and complex.  BSA has viewed some that are 13,000 pages long. There is often little consideration made to what else is happening at that time – eg. harvest, tax-time – that would hinder landholders from being able to respond.  BSA would like to see a more open process where CSG companies are proactively engaging the landholders who are set to be impacted.

Loss of privacy and security

Once an agreement is negotiated, landholders must face a huge adjustment to the way they live.  Many landholders feel that they have lost their privacy, lost control of their property and their lifestyle.  While CSG companies are required to advise landholders if work is commencing on site, the landholder can have any number of workers coming and going from their property at all hours of the day and night.  For example, some families whose children previously roamed freely around the property on horse/motorbike no longer feel comfortable or safe as they cannot be sure who is on their property and/or where vehicles or equipment are at any one time. Landholders are also having to adjust to disturbances such as traffic, lights, noise and dust.

Impacts on Land Values
There is concern that uncertainty surrounding CSG activity is affecting property values. It is important to note that agreements made with CSG companies lie with the land - so future purchasers will be bound to any agreements made.  Read Qld Country Life article on this issue >>

Loss of confidence to expand
Due to uncertainty of what CSG development will occur on their properties in the future, many landholders across the Surat Basin have indicated a lack of confidence to develop and expand their property and/or operations.  BSA fears that a lack of confidence to develop agricultural businesses will hurt Australia's food and fibre production.

Mental Health implications
Members of Surat Basin communities have indicated concern about the increasing incidence of deteriorating mental health levels.  Research done by Dr Jo Anne Everingham from the Centre for Social Responsibility in Mining, University of Queensland, found that in other parts of Australia rapid and expansive mineral developments can lead to a sense of disorientation called ‘Solastalgia’.   Solastalgia can be described as “home-sickness at home” because the home environment has been radically altered.    That is your home suddenly no longer feels like your home, your community suddenly no longer feels like your community.   BSA urges members of the community to seek help if required and look out for each other.  Read a summary of Jo Anne Everingham's talk at the AIAST Queensland Division Conference Nov 2010>>

Competition for Labour / Staff
Businesses within the Surat Basin are already suffering from untenable competition for staff with reports of business being unable to survive in this climate.  This could be an early warning sign of a developing “Dutch Disease” (ie. the adverse effect on a country's other industries that occurs when one industry substantially expands its exports)  in Great Artesian Basin communities as agency, effort, resources, social capital and labour is redeployed towards the booming energy sector at the expense of others.

Crime
There is some evidence to suggest that an increase in mineral development can impact on communities’ crime rate.  Professor Kerry Carrington has called on mineral developers and contractors to address the impacts of their activities on crime rates after her study which found “alcohol-fuelled violence and social disorder were rife in some regional communities located alongside large populations of mine and construction workers housed in camps.” Access a copy of Globalisation, frontier masculinities and violence - booze, blokes and brawls (Kerry Carrington, Alison McIntosh and John Scott)>>

BSA Recommends:
• Landholders should seek independent legal advice before signing any legal agreements with CSG Companies.
• Landholders should actively seek information about any tenures over their properties and be mindful of the seriousness of Environmental Impact Statements and other processes that CSG Companies are required to take.
• Regardless of other farm commitments, landholders should promptly attend to concerns they might have about CSG operations.
More information for landholders can be found in the BSA Landholder Factsheet>> COMING SOON