Shale gas knocking on northern beef doors

Lessons learnt in the east are being thoroughly assessed in the attempt to facilitate co-existence.

Balancing petroleum resource development with pastoral industry sustainability was a key theme at the 2016 Northern Territory Cattlemen’s Association conference in Alice Springs this month.

From the plethora of experts on hand to shed light on what is a complex and emotive topic, several points emerged as key to getting right that balance.

Well integrity can not be negotiable, the regulatory framework must place graziers and energy companies on equal ground in land access negotiations and the full list of strengths and weaknesses of the gas industry needs to be made clear.

The shale industry is in its infancy in the Territory, with only a handful of gas wells drilled so far.

A Deloitte Access Economics study, commissioned by the Australian Petroleum Production and Exploration Association, found that shale gas in the Territory has the potential to underpin a new wave of investment delivering thousands of jobs and big economic opportunity, including almost $1 billion in government revenue.

Shale gas is trapped at an average depth of 2.5 kilometres underground in the Territory and requires fracking to produce - that is the process of injecting water, sand and approved chemicals under pressure to fracture the shale rock and release the gas.

Energy law expert Dr Tina Hunter, from Aberdeen University in Scotland, said the NT had stable, well-compressed geology suitable to these processes.

“The NT also has a good start on other issues, such as transport, noise and seismicity, compared to other areas in the world with shale gas potential,” she said.

More importantly, there had been a philosophical shift in how regulation of the industry was approached.

That approach moved away from prescriptive towards objective-based, of which ecological sustainability and risk reduction to as low as reasonably practical were the key components.

“That’s a gutsy approach on the part of the NT and it means we are 90 per cent there,” Dr Hunter said.

“Keep in mind, we’ve done this before - traditional owners and pastoralists now co-exist and we can do the same with shale gas industry.

“The laws say both can happen so we have to find a way new and old industries can come together to use land in an integrated way.”

Dr Hunter said while the ‘f’ word was incredibly emotive, the reality was ‘if you’re only worried about fracking you’re misguided.’

Well integrity, and inspection - including the need to plan for abandonment before construction - was far more important.

“The environmental impacts flow from a lack of well integrity,” she said.

Research and history had also shown that stakeholder engagement was not enough - negotiation and agreement would be necessary.

That point was seconded by NTCA president Tom Stockwell, who said the new era of access agreements announced late last year were a ‘leap forward’ in providing a basis for good faith negotiations and respect between pastoralists and explorers but there was still work to be done.

“The NT government and the gas industry needs to prove to us in practical terms how safety - for water in particular - will be assured; how it will be monitored and when something does go wrong, how it will be detected and remedied in a timely manner,” he said.

“World’s best practice and guiding principles are not explanations.

“We need to know how many inches of hardened steel casing is going how far below the water aquifer, and we need to see and touch the monitoring and control systems.

“Is fracking 2km under the aquifer like the explosions we see in the iron ore mines or is it like someone driving pickets on the other side of the MacDonnell Ranges?”

These answers needed to be forthcoming, he said.

“On the other side of the coin, if we simply dismiss the opportunities on the basis of zero tolerance for risk, or a barrage of yellow triangular signs and imaginative three-word slogans, we are no better than those Nimby mobs who react to a sign about about live export on the back of an urban bus,” he said.

“Our power here today is from fracked gas, and the reduction of diesel prices we’re enjoying is largely due to the massive expansion of the shale oil industry in the US.

“No discussion of northern development and the cattle industry is honest unless it considers the potentially tremendous opportunities of not only an assured supply of cheap energy, but the associated infrastructure gains for the NT and pastoral industry that governments are failing to fund.”

Arid Lands Environment Centre director Jimmy Cocking made the point there was already a conventional gas industry - ‘this is unconventional that is trying to get a foothold’.

Mining was running ahead of science and the big concerns about water were not being addressed, he said.

“The burden of proof should be on the person who wants to do the job,” he said.

“We don’t have to accept that co-existence is a given.

“We must have absolute certainty our water is safe, for how do you compensate a polluted aquifer?

“That’s why we support a moratorium.”