ABC News, 10 June 2020:
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| Image: ABC Southern Queensland: Nathan Morris |
Australia's largest insurance company says it will no longer cover farmers for public liability if they have coal seam gas (CSG) infrastructure on their property.
The development has made farmers fearful they will have to cease farming altogether if they cannot get cover.
Insurance Australia Group (IAG) has confirmed its major rural and regional insurer, WFI, will join its other subsidiary, CGU, in no longer providing the coverage if there is "unconventional gas" operations on properties.
IAG said for customers who "have operational CSG or shale gas activities or infrastructure on their property, such as a coal seam gas well, we will be unable to provide liability cover as part of their insurance policy".
IAG said the company does not specialise in mining and resources operations and the change will affect existing customers when their policies come up for renewal. AgForce Queensland said that is as soon as the end of this month. Michael Guerin talks to a man in front of a book shelf.
AgForce Queensland CEO Michael Guerin says farmers are worried the change could expose them to liability risks.....
Queensland farmers said they were fearful the change could expose them to liability risks and could extend to other risks associated with CSG, such as the potential for groundwater contamination.
It is understood the Queensland Government has been holding talks with insurers, mining industry representatives and AgForce, in an attempt to resolve the problem.....
ABC News has obtained legal advice provided to the New South Wales Government in 2014, warning that insurance for CSG in Australia was "inadequate" and measures were needed to address the potential cost of contamination risks. [my yellow highlighting]
AgForce's Queensland chief executive Michael Guerin said farmers were deeply concerned.
"Producers, like any business, can't operate without insurance," Mr Guerin said.
Spokesperson for the Lock the Gate Alliance, Rick Humphries is calling on the gas industry to compensate farmers.....
He said while some other insurers were providing cover for now, there was a risk they would pull out of the sector or jack up prices. "All of those dangers are there," he said.
"There's a danger that insurance premiums will go up [and] there's a danger insurance will be harder to get."
AgForce Queensland said insurance being withdrawn threatened the coexistence of unconventional gas and agriculture.
He said there had been a lot of hard work in devising complicated agreements to allow the two industries to work together over the years.
"If part of the insurance industry starts withdrawing cover, it puts that at risk, and that's the core of the concern at the moment," Mr Guerin said.
Anti-mining, pro-agriculture group Lock the Gate said the gas industry should be made to compensate farmers. Spokesperson for Lock the Gate and former mining consultant, Rick Humphries, said farmers should not be the ones facing the risk.
"The onus is on the gas industry to get insurance products that cover their assets and protect the farmer," Mr Humphries said.
"The farmer shouldn't have to run around and look for insurance products.
"But the way that the system has worked is that the Government has knowingly allowed gas industry to enter into contracts with farmers that expose farmers to a whole range of business and natural resource risks around water and land contamination."
He said laws needed to be changed to force the companies to act. "The whole mining and gas model is all about transferring as much risk away from the shareholder," he said.
"The companies won't willingly step up and do this because it's an additional expense, and they have to take on the risk.
"Governments have to intervene to force mining and gas companies to take out insurance products, or demonstrate they [have] adequate coverage that will compensate landholders."......
Read the full article here.
BACKGROUND
* Queensland Government Audit Office 2019-20 report on Queensland coal seam gas activities can be found at:
https://www.qao.qld.gov.au/reports-resources/reports-parliament/managing-coal-seam-gas-activities
* ABC News, 30 March 2020:
A leaked expert report shows the Queensland Government was advised to stop further gas fracking in the state's sensitive Channel Country, but a separate department had already extended gas exploration until 2030.
A confidential report to the Queensland Environment Department prepared by environmental scientists recommended that infrastructure for gas fracking and mining was "unacceptable" in the Lake Eyre Basin floodplains, known as the Channel Country.
The 47-page report, obtained by ABC News, lists scores of potential risks associated with so-called unconventional gas extraction, (also known as gas fracturing or fracking), including direct impacts on threatened species and water quality.
As ABC News revealed earlier this year, the Queensland Mines Department in March 2019 had approved Santos to keep exploring commercial gas opportunities in the area until 2030, despite an election commitment to protect "pristine rivers" and work with stakeholders.
A union of environmentalists, graziers, traditional owners and other stakeholders, known as the Western Rivers Alliance, said the promised consultation did not happen.
The report, recommending that further fracking for natural gas be stopped, was received by the Environment Department in October last year.....
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