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Legislative Council - Fifty-Third Parliament, First Session (53-1)
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Motions

Inquiry into Unconventional Gas

Adjourned debate on motion of Hon. M.C. Parnell:

That pursuant to section 16 of the Parliamentary Committees Act 1991, the following matters be referred to the Environment, Resources and Development Committee for inquiry and report—

1. The processes involved in the exploration for and extraction of conventional and unconventional gas;

2. The experience of hydraulic fracturing (or 'fracking') for unconventional gas in South Australia, interstate and overseas;

3. The impacts and potential impacts of gas exploration and extraction on—

(a) groundwater;

(b) surface water;

(c) air quality;

(d) climate change;

(e) human health;

(f) agricultural land productivity;

(g) property values; and

(h) local, regional and national economies;

4. How the exploration for and extraction of conventional and unconventional gas should be regulated in South Australia; and

5. Any other relevant matter.

(Continued from 29 October 2014.)

The Hon. T.T. NGO (16:11): I am a member of the Environment, Resources and Development Committee (ERD) and I oppose the motion of the Hon. Mr Parnell. The honourable member moved to amend the Petroleum and Geothermal Energy Act 2000 (hydraulic fracturing) during the last sitting week of parliament. The amendments proposed would place a two-year moratorium on hydraulic fracturing activities on land anywhere in South Australia, require the minister to prepare a report on the potential impacts of hydraulic fracturing during that period, and thereafter ban hydraulic fracturing in prescribed areas. This council voted against the bill on the last sitting week.

As I said previously in my second reading contribution on the bill, hydraulic fracturing is just one technology already well regulated under the Petroleum and Geothermal Energy Act and has been performed in this state in over 700 wells safely and without harm over the last 40 years.

Our state is the nation's leader in regulating the hydraulic fracturing industry. There is a strict process that addresses all potential environmental impacts before companies can operate. On top of that, interested parties are well informed throughout the process. Other states are looking at our model to replicate what we are doing. Also, in other states fracking is related to shallow coal seam gas. Shallow coal seam gas is very different from the deep gas resources that are being developed in South Australia and poses different potential risks.

South Australian deep gas resources have much smaller surface footprints and, as they are much deeper, there are thousands of metres of rock between the resource where the hydraulic fracturing would occur and the shallower potable or beneficial aquifers. The majority of members of the ERD committee, both opposition and government, recently voted against having an inquiry about fracking. The committee decided not to have an inquiry that the Hon. Mr Parnell proposed, due to various reasons that I have just outlined.

This industry currently employs thousands of South Australians and their families. It is a critical industry to our state's economy now and into the future. It also provides security of supply for our natural gas. We need to provide this industry with the encouragement and support that it deserves. As I outlined, it is critical to our economy and employs thousands. This motion, I believe, will do the opposite and, therefore, I do not support this motion.

The Hon. T.A. FRANKS (16:15): I move to amend the motion as follows:

Leave out all words after 'be referred to' and insert:

the Natural Resources Committee for inquiry and report on the potential risks and impacts in the use of hydraulic fracture stimulation to produce gas in the South-East of South Australia, and in particular—

(a) the risks of groundwater contamination;

(b) the impacts upon landscape;

(c) the effectiveness of existing legislation and regulation; and

(d) the potential net economic outcomes to the region and the rest of the state.

I will be brief. The effect of this amendment is twofold. Firstly, it changes the terms of reference to match those moved by the member for Mount Gambier, Mr Troy Bell, in the other place, and, secondly, it changes the forum for the inquiry from the Environment, Resources and Development Committee to the Natural Resources Committee. When summing up the debate on this motion, my colleague the Hon. Mark Parnell will outline some of the background to these changes and why the Greens believe that the South-East community deserve the opportunity to have their legitimate concerns investigated in an open forum.

The Hon. D.W. RIDGWAY (Leader of the Opposition) (16:17): I rise on behalf of the opposition to speak to what is now the amended motion, that is, to refer an inquiry into fracking, or hydraulic fracture stimulation, to the Natural Resources Committee rather than the Environment, Resources and Development Committee. As members would know, from the notice of motion that I moved today and gave notice of for the next Wednesday of sitting, we are moving down this path to mirror the terms of reference proposed in the House of Assembly by my colleague the new member for Mount Gambier, Troy Bell, and also to have it referred to the Natural Resources Committee. So, it appears that we are on the same page, and I think that is an important position to come to.

By way of background, it was a pre-election commitment by the then candidate for Mount Gambier that we would have a parliamentary inquiry into these matters in the South-East. Also, it is interesting to recall that the member for Waite was our shadow minister at the time. I have never in the past, and I do not intend to today, talk about internal Liberal Party matters; nonetheless, a range of options were canvassed and the policy that we took to the election was to have a parliamentary inquiry into hydraulic fracturing in the South-East.

I think my comments over the years are well known. I was fortunate enough to be the shadow minister for mining some years ago, and I am now the shadow minister for agriculture and also energy, and I have had an opportunity to be the Liberal Party spokesman across all of these areas.

There being a disturbance in the strangers' gallery:

The PRESIDENT: Order! The cameraman needs to be reminded that you can only focus on the person on their feet rather than swinging the camera around the chamber. Thank you. The Hon. Mr Ridgeway has the call.

The Hon. D.W. RIDGWAY: It is important to recall and note that the Liberal Party believes that we need to have the coexistence of all of these industries. You cannot have one at the expense of the other, and we have done that in the history of this great state for 175 or more years. We started with an agricultural economy and then had various times of mining activity boom, shall we say. Of course, we had the 60th anniversary recently of Santos and its activity in the Cooper Basin. The great contribution that Santos has made to this great state is to be commended.

Nonetheless, this was an election commitment. The people of the South-East, as the Hon. Tammy Franks said, deserve to have their concerns heard in an open forum. As members would know, I am originally from the South-East and I have put on the record here a number of times that I am the only person I think ever elected to this parliament whose entire income was derived from accessing water from that aquifer, so I am well aware of concerns that a number of people in the South-East have and I think it is very appropriate that we have an inquiry that gives them an opportunity to put their concerns in a way where they feel they can be heard, and heard without any particular bias.

I think all of us in this place share some blame in relation to the community's low view of members of parliament because when the government comes along and says, 'We are going to do something and, trust us, we are from the government,' these days nobody believes them. This is an opportunity for the people of the South-East who have some genuine concerns. I have been down there and met with a number of them and this is a real opportunity for them to put their concerns in an open public forum.

I think the Hon. Mark Parnell and others have been saying that we have been trying not to have this inquiry but nothing could be further from the truth. We have always intended to have a parliamentary inquiry. We saw the Hon. Troy Bell—he is not honourable, but Mr Troy Bell, the member for Mount Gambier—

Members interjecting:

The Hon. D.W. RIDGWAY: I should not say that; he is a very honourable man but he does not have an 'honourable' title, shall I say.

Members interjecting:

The PRESIDENT: Order!

The Hon. D.W. RIDGWAY: His preference, of course, was to hopefully have one in the chamber where he is a member. Up until very recently the member for Waite had been visiting the South-East and he gave no indication that his policy or his views had changed. Members would also understand that we do not have a member for Fisher, sadly, and we do not have a member for Davenport, and so for any chance of that motion being successful we needed to wait until those seats were filled. Now that the Hon. Martin Hamilton-Smith has indicated that he will not be supporting it, it is really irrelevant that we wait any further because we will not have the numbers. It was disappointing that he has obviously come to that new view.

It was a decision of the Liberal Party's party room that we give notice today that we have a Natural Resources Committee inquiry. When you look at the instructions, the guidelines or, if you like, the framework of the Natural Resources Committee, it certainly deals with underground water resources. It has already done an inquiry on Eyre Peninsula into underground water; all of the water allocation plans are dealt with through the NRM boards and they all report to the NRC, so it is quite closely linked to it.

It makes a lot of sense that the Natural Resources Committee look at this issue. It has already started taking some evidence. My understanding is that as recently as August the committee was receiving detailed briefings on fracking from the likes of Dr Dennis Cooke of the Australian School of Petroleum at the Adelaide University. It makes sense, when you look again at the functions of the Natural Resources Committee, and I will read them out: they are specific and appropriate to this cause; they are to review the protection, improvement and enhancement of the natural resources of the state. The natural resources include soil, water, geological features, landscapes, native veg, animals and other native organisms and ecosystems.

It was our party room's view that this was the best forum and, given that it had already started taking some evidence, the members were familiar with the issues. Having done the inquiry into the Eyre Peninsula water resources, it just made sense to us that this would be the most suitable committee. It is nonsensical, from the opposition's perspective, not to direct this inquiry to the committee which already has a foundation of knowledge and can, if you like, hit the ground running.

As I said and reiterate, it was always the opposition's policy to establish a parliamentary inquiry. We have not received support from the government, and the government are entitled to make their judgements, so today we have given notice that we will move this to the Natural Resources Committee on the next Wednesday of sitting.

I am pleased that the Greens have decided to amend their motion to align with our proposal. It means that, if the chamber supports it today, we will have an inquiry along the lines that Mr Troy Bell proposed, which was in the South-East. We were always nervous about the original terms of reference from the Hon. Mark Parnell, which were very broad and covered the whole state.

As I mentioned, we have had Santos working for 60 years in the north of the state. We have all the issues around geothermal, which I think everybody supports. If they can crack that geothermal nut and tap into that energy source, it will be a wonderful source of energy. We do not want to impact on any of that, but we have in the South-East a unique part of this state. It is a rich farming area. It has a unique system of aquifers that, as I said, I have accessed. They are vitally important to the future economic wellbeing of the South-East.

It is important that we have an inquiry so that all those issues, all the concerns of the community and all the evidence the mining industry would want to put forward are heard as well. I think it is important that this inquiry encompasses all views and that all the questions from those who are opposed to it are tabled for those who are going to answer those questions. It is important that it is done in a very professional and robust way, and the opposition sees the Natural Resources Committee as the logical place to conduct this inquiry. With those few words, I urge all members to support the motion.

The Hon. R.L. BROKENSHIRE (16:26): I advise that Family First's position is that, now there is an amended motion, we will be supporting that. I had a detailed discussion with the Hon. Mr  Parnell last Friday, and I thank him for his time in discussing it with me. I think, apart from the government, there is general consensus that we should be holding an inquiry.

I want to put on the public record that I noticed that the Treasurer and Minister for Mineral Resources and Energy was out there having a crack at the opposition on this occasion for actually floating the idea of an inquiry. I remind the Treasurer that, when you actually make a commitment to a community, you have to stick to that commitment. It is a basic situation where maybe the government flip-flop around and decide to change their mind, but if you actually go out with a policy decision in an electorate, in particular, you have to honour that.

I was clearly aware, when I was campaigning down there for our Family First candidate, that there had been a commitment made by the now member for Mount Gambier, Mr Troy Bell, that the Liberal Party would hold an inquiry. That does not mean that the Liberal Party or Family First are opposed to mining—we are not—but it is about appropriateness, it is about where you mine and where you do not mine, and it is about the best long-term return to a region and the state.

Of course, as we see the free trade agreement with China signed now—and declaring my own interest as a dairy farmer—for a change, that free trade agreement is actually good for a lot of agriculture and good for the dairy industry. In fact, the most sustainable opportunity for expansion, economic development, growth and jobs in the South-East now may well be expanded to dairy as that tariff comes back to zero over the next four to nine years, depending on which part of the dairy product is phased to zero tariff on the priority arrangement within the free trade agreement.

Family First are not opposed to mining at all, but we also proudly support farming. It is a matter of the balance in all this. An inquiry will give the local people, some of whom have been there for generations, an opportunity to make submissions on their concerns to a committee. It will give the committee, on behalf the parliament, an opportunity to look at the pros and cons of fracking in that particular area and, through the committee, it will also give companies like Beach the opportunity to put their information and scientific research into the parliament.

The Hon. Mr Ridgway is correct: as a member of the Natural Resources Committee, we have already made some significant inroads into preliminary briefings from renowned people on fracking. Whilst I agreed with the general intent of the Hon. Mark Parnell, I believe I indicated to him during our discussion that the question in my mind was: which would be the best way of having an inquiry—would it be the ERD, the NRC or in fact a separate standing committee? I thought it might have been a standing committee in the House of Assembly and, given that they are already up at quarter past four tonight, I would have thought that they have plenty of time.

The Hon. T.J. Stephens: Quarter to four.

The Hon. R.L. BROKENSHIRE: Quarter to four—gee, they worked hard today, and they do not want to sit either! I thought they would have had time to have a standing committee, but of course we saw a backflip from a now minister of the Labor government, who at one stage was actually supporting the importance of an inquiry, but he suddenly woke up one morning and it was just a bad dream and he did not want to support the inquiry. With cabinet solidarity, there will now be no inquiry, so he is cutting out the opportunities for democratic processes for the people of the South-East, and I say that he should think again.

Without pre-empting what they might do, let us get on with it. On the Natural Resources Committee, its terms of reference are there for us appropriately to do this investigation—and I apologise in advance to my colleagues the Hon. Gerry Kandelaars and the Hon. John Dawkins, as we are all pretty busy on that committee; notwithstanding that I support this motion, particularly because my colleague the member for Flinders, Mr Peter Treloar, is a farmer.

My family and I are farmers and, given that the focus of this inquiry needs to be on farming, farmers and farming families and that we have those two and the Hon. John Dawkins, who has a great knowledge of farming and used to farm, there is already quite a lot of farming experience on that committee. Therefore I congratulate Mr Parnell for moving the amendment to the NRC, and Family First has pleasure in supporting the motion.

The Hon. J.A. DARLEY (16:32): I indicate that I will support the Hon. Mark Parnell's motion and amendment.

The Hon. K.L. VINCENT (16:32): For the assistance of the chamber, I indicate that Dignity for Disability will also support both the motion and the amendment.

The Hon. M.C. PARNELL (16:32): I thank the Hon. Tung Ngo, the Hon. David Ridgway, the Hon. Rob Brokenshire, the Hon. John Darley and the Hon. Kelly Vincent for their contributions, and also my colleague the Hon. Tammy Franks for moving the amendment that substantially changes what members would have in front of them on the Notice Paper. I wish to make some brief observations about the contributions that have been made.

The first thing I would say about the government's contribution is that, as the Hon. Tung Ngo indicated, he is a member of the Environment, Resources and Development Committee, and, yes, it is correct that I did put this to that committee and they did not want to talk about it. As the honourable member knows, under the Parliamentary Committees Act, whether or not a committee wants to look at something is not entirely a matter for them; it is also a matter for the parliament.

If the parliament thinks a matter is important enough to look into, it can send a reference to a standing committee of the parliament and that committee is then obligated to inquire into that matter. So, it did not put me off that the ERD Committee of its own volition did not want to talk about unconventional gas because I had every confidence that this parliament would send the inquiry their way. As things have transpired, we are going to a different committee, and I will touch on that in a second.

The Hon. Tung Ngo also said that the industry needs our encouragement and support. I guess by inference what they do not need is anyone asking questions about them. It seems to me that the Chamber of Mines came out swinging when it found out that there was some momentum for a parliamentary inquiry into fracking. I would have to say that any industry that is so fearful of questions being asked about it must be on very fragile ground, and I really do not understand the vehemence of its reaction. I would have thought they would have welcomed the opportunity to put on the record what they consider is a safe and well-regulated industry. Instead, they came out swinging and criticised those who looked to be supporting an inquiry.

The Hon. David Ridgway, in his contribution, mentioned that we now appear to be on the same page, and I think that is correct, in that everyone in this chamber, other than the government, is supporting the amended terms of reference. The Greens have gone down this path out of respect for the citizens of the South-East. Most people do not understand the fine detail of parliamentary procedure; they just know they want an inquiry and they are now going to get an inquiry.

But I have to touch on the issue of whether the terms of reference that we are now going to agree on are better than the terms of reference as originally proposed and, whilst I am supporting my colleague the Hon. Tammy Franks' amendment, I have to say that these terms of reference are incredibly narrow, and the Chair of the committee will, I think, be under pressure to allow questions to be asked and evidence to be raised that go beyond the very narrow scope of this.

Two issues jump out at me. First of all, the question of climate change has now been omitted from the terms of reference but, as members who follow this would know, one of the most recent articles—in fact, it just hit my desk today—that came out in a peer-reviewed scientific journal basically says that they have been looking at the fugitive emissions from unconventional gas fields and they have found out that the levels of carbon dioxide and methane are much higher than in surrounding areas.

When you recognise that methane has a climate-forcing potential 20 times—or maybe even more than 20 times—that of carbon dioxide, small amounts of fugitive emissions from these unconventional gas fields can cause huge problems for climate change. Again, it is now not in the terms of reference.

Another matter that is now omitted from the terms of reference is any impact on the health of the citizens of the South-East in relation to this activity. Just yesterday, members may have all received—at least, I hope it went to all members—a letter from Doctors for the Environment. Doctors for the Environment basically say that they welcome, in anticipation, our vote today to establish a parliamentary inquiry into fracking. I will just read you a couple of sentences from the submission:

Doctors for the Environment Australia say that the Environment, Resources and Development Committee, which is conducting the inquiry, will help to highlight the potential devastating health impacts of shale gas extraction, especially for rural communities.

Doctors for the Environment spokesperson, Dr John Willoughby said:

There is no justification for unconventional gas anywhere near aquifers, people or agriculture. The evidence from overseas and from other Australian states shows that if this mining practice is allowed, problems cannot be avoided.

The original terms of reference did invite the committee of inquiry to look into the experiences interstate and overseas, because this is the only way we can predict what the impacts might be here. If the inquiry is so narrowly focused that it only looks at fracking in the South-East, well, there will not be a whole lot to inquire into, as there has not been any yet. I am hoping that the Natural Resources Committee will be more sensible and will allow these issues to all be agitated. I will not read Doctors for the Environment's whole list of dot points about what is wrong with fracking, but I will just read you a couple of them:

Hazardous chemicals associated with large volumes of water used and brought back to the surface during mining may concentrate in ponds and pollute the air. The chemicals include fluoride, boron, lead, benzene and toxic hydrocarbons which are implicated in a number of medical conditions.

There is particular concern in a US report of an increased prevalence of heart defects in children whose mothers lived in close proximity to gas fields.

I will not read all the rest. There are clearly health impacts of fracking, yet these narrow terms of reference do not include them.

I hope that the committee will take it upon themselves not to try to stifle any evidence that is sought to be given. For example, if Doctors for the Environment Australia seek to give evidence, I do not want that committee slapping their hands over their ears and saying, 'La, la, la, we don't want to hear about that.' I think that is what the people of the South-East are concerned about, amongst other things, like the pollution of their groundwater. The committee should look into it.

The Hon. David Ridgway basically said, 'Well, we were always going to have this inquiry.' The point I make, and I mean no disrespect to the member for Mount Gambier, is that it was clear that that particular motion was doomed to fail. It was doomed to fail once we knew parliament was prorogued and once we knew that the two Independent ministers were going to vote against it.

So, unless we were prepared to wait for next year, which we are not prepared to do, we need to deal with this now. I think for the Liberal Party to pretend they are all on same page—no, they are not; there are many members who did not want any inquiry at all.

The Hon. J.M.A. Lensink: You don't know that.

The Hon. M.C. PARNELL: I do know that. The Hon. Rob Brokenshire sits on the Natural Resources Committee and he will effectively have crossbench carriage, I guess, of this, and I know he is looking forward to that.

The Hon. R.L. Brokenshire: And I like Dr Shearman, too.

The Hon. M.C. PARNELL: And he has interjected, very rudely, that he will invite Dr Shearman to come and give evidence.

Members interjecting:

The PRESIDENT: Order! The Hon. Mr Parnell has the floor.

The Hon. M.C. PARNELL: I correct the record: the Hon. Rob Brokenshire did not say he would invite Dr Shearman, he said he liked Dr Shearman; it is important to get that right. In conclusion, Mr President, does this motion represent a compromise? Well, absolutely, it does. But, as I say, I value and respect the desires of the South-East community. They wanted a parliamentary inquiry, they are going to get a parliament inquiry. Would I have liked to have been on that inquiry to ask the questions of the experts? Certainly, I would have, but at the end of the day it is going to a different committee.

What I will say is that I will certainly be at the public hearings of this inquiry making sure that the committee does a thorough job, and making sure that the farmers and other citizens in the South-East get their day in court, as it were, and get their chance to give evidence and to put their views before the committee. I am delighted that this Greens' inquiry is now going to be passed.

The Hon. T.A. Franks' amendment carried.

The council divided on the Hon. M.C. Parnell's motion as amended:

Ayes 15

Noes 6

Majority 9

AYES
Brokenshire, R.L. Darley, J.A. Dawkins, J.S.L.
Finnigan, B.V. Franks, T.A. Hood, D.G.E.
Lee, J.S. Lensink, J.M.A. Lucas, R.I.
McLachlan, A.L. Parnell, M.C. (teller) Ridgway, D.W.
Stephens, T.J. Vincent, K.L. Wade, S.G.
NOES
Gago, G.E. Gazzola, J.M. Hunter, I.K.
Kandelaars, G.A. Maher, K.J. Ngo, T.T. (teller)

Motion thus carried.

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