As the story unfolded.........
Oil and gas company Linc
Energy has been placed into administration in a bid to avoid penalties for
polluting the environment, a Queensland green group says.
It was announced late
Friday that administrators PPB Advisory had been called in to work with Linc's
management on options including a possible restructure.
In a statement to the
ASX, the company said after receiving legal and financial advice and
considering commercial prospects the board decided it was in the best interests
of the company to make the move.
The state's environment
department accused the company of wilfully causing serious harm at its trial
site near Chinchilla on the Darling Downs.
Drew Hutton from the
Lock the Gate Alliance said the company could face up to $56 million in fines
if found guilty, but the penalty might never be paid.
"It is going to be
difficult to get any money out of this company now that it is in
administration," he said.
Mr Hutton said going
into administration was a common legal manoeuvre to dodge fines and costly clean-ups......
Environmental Protection
Order directed to Linc
Prior to Linc entering
liquidation, DES issued Linc with an Environmental Protection Order (EPO) which
required it to retain critical infrastructure on-site, conduct a site audit and
undertake basic environmental monitoring to characterise the current status of
the site.
Linc’s liquidators
launched a legal challenge associated with this EPO in the Supreme Court
seeking orders that they were justified in not causing Linc to comply with the
EPO (or any future EPO). DES opposed this application.
In April 2017, the
Supreme Court directed that Linc’s liquidators are not justified in
causing Linc not to comply with the EPO. The Court accepted DES’ argument that
the relevant provisions of the EP Act prevail over the Commonwealth Corporations
Act and that Linc’s liquidators are executive officers of the company.
Subject to any appeal decision, this confirms DES’s ability to enforce
compliance with environmental obligations owed by resource companies who have
gone into administration or liquidation.
Linc’s liquidators have
since appealed the decision to the Court of Appeal. This appeal was heard in
September 2017 and the decision was reserved.
Environmental Protection
Order directed to a related person of Linc
DES used the ‘chain of
responsibility’ amendments to the EP Act to issue an EPO to a ‘related person’
of Linc. The EPO requires the recipient to take steps to decommission most of
the site’s dams and provide a bank guarantee of $5.5 million to secure
compliance with the order.
The recipient of the EPO
has appealed to the Planning and Environment Court and that litigation is
ongoing.
The recipient of the EPO
also applied for an order that the appeal be allowed and the EPO be set aside
on the basis that DES denied him procedural fairness. The Planning and
Environment Court dismissed that application. The recipient of the EPO appealed
that decision to the Court of Appeal. That appeal was heard in March 2017 and
judgment in favour of DES was delivered in August 2017. Subject to any further
appeal, this decision confirms that the recipient was not denied procedural
fairness and that DES’ interpretation of the EP Act was correct.
The earlier appeal in
relation to the EPO (regarding the substance of the document) is yet to be
heard by the Planning and Environment Court.
Investigation and
prosecution of Linc and former executives
Linc Energy Limited will
stand trial in the Brisbane District Court, commencing 29 January 2018, on five
counts of wilfully causing serious environmental harm, in contravention of the Environmental
Protection Act 1994.
All counts relate to
operations at the Linc Energy underground coal gasification site near
Chinchilla, from approximately 2007 to 2013, and allege that contaminants were
allowed to escape as a result of the operation.
In addition, the
Queensland Government has charged five former Linc Energy executives over the
operation of the UCG site in Chinchilla. A committal hearing in the Brisbane
Magistrates Court is expected to take place in mid-2018.
As these matters remain
before the courts, DES is unable to comment further on the legal proceedings.
Media releases
A landmark case
described by a District Court judge as "unusual" will hear how gas
company Linc Energy allegedly contaminated strategic cropping land causing
serious environmental damage to parts of Queensland's Western Downs.
Linc Energy is charged
with five counts of wilfully and unlawfully causing environmental harm between
2007 and 2013 at Chinchilla.
The charges relate to
alleged contamination at Linc Energy's Hopeland underground coal gasification
(UCG) plant.
The trial will enter its
second day today in the District Court in Brisbane, with crown prosecutor Ralph
Devlin QC expected to begin his opening address to the empanelled jury later
this morning.
Former Linc Energy
scientists, geologists, and engineers as well as several investigators from the
Queensland Environment Department are among those expected to give evidence.
BRISBANE, AAP – A
failed energy company accused of knowingly and illegally polluting a
significant part of Queensland’s Darling Downs has faced trial in a landmark
criminal case in Brisbane.
Linc Energy is charged
with five counts of wilfully and unlawfully causing environmental harm between
2007 and 2013 after allegedly allowing toxic gas to leak from its operations.
The Brisbane District
Court trial has heard Linc’s four underground coal gasification (UCG) sites and
water were polluted to the point it was unfit for stock to consume but the
company kept operating.
Crown prosecutor Ralph
Devlin QC told the jury the company allowed hazardous contaminants to spread
even after scientists and workers warned about gases bubbling from the ground.
Linc operated four UCG
sites in Chinchilla where it burnt coal underground at very high temperatures
to create gas.
In his opening address
on Tuesday, Mr Devlin said scientists warned senior managers about the risk
environmental harm was being caused throughout the operation…..
‘Bond prioritised Linc’s commercial interests
over the requirements of operating its mining activity in an environmentally
safe manner,’ Mr Devlin said.
‘Linc did nothing to
stop, mitigate or rehabilitate the state of affairs that Linc itself had
caused.’
As part of the UCG
process, Linc injected air into the ground, which created and enlarged
fractures.
It tried to concrete
surface cracks and use wells to control pressure but they didn’t sufficiently
reduce risks or damage, the court heard.
‘Linc kept going, even
knowing the measures weren’t working,’ Mr Devlin said.
Scientists who visited
the site are due to give evidence during the nine-week trial, but no senior
managers from the company, which is in liquidation, will take the stand.
The trial continues.
Workers at an
underground coal gasification plant on Queensland's Western Darling Downs were
told to drink milk and eat yoghurt to protect their stomachs from acid, a court
has heard.
The corporation is not
defending itself as it is in liquidation so there is no-one in the dock or at
the bar table representing the defence.
A witness statement by
former gas operator Timothy Ford was read to the court, which he prepared in
2015 before his death.
The court was not told
how Mr Ford died.
He said the gas burnt his
eyes and nose and he would need to leave the plant after work to get fresh air
because it made him feel sick.
"We were told to
drink milk in the mornings and at the start of shift… we were also told to eat
yoghurt," he said.
"The purpose of
this was to line our guts so the acid wouldn't burn our guts.
"We were not
allowed to drink the tank water and were given bottled water."
Mr Ford said he always
felt lethargic, suffered infections and had shortness of breath.
"During my time at
the Linc site, would be the sickest I have been," he said.
"It is my belief
that workplace was causing my sickness.
"I strongly feel
that the Linc site was not being run properly due to failures of the wells and
gas releases.".....
A CONCRETE pumper says he
saw 'black tar' seeping up at a Linc Energy site and raised concerns with the
company.
Robert Arnold has told a
court he noticed some odd occurrences when he went to the Chinchilla site in
late 2007……
On Thursday, Mr Arnold
told jurors he noticed several phenomena at the site.
"We saw bubbles
coming up ... and a black tar substance. We commented back to Linc about
it."
"A few of us went
over and had a look ... basically it just looked like a heavy black oil ... it
was in the puddles as well, in the same area," Mr Arnold added.
"We couldn't place
our equipment close to the well because of these overhead pipes ... it was
dripping out of the joints."
Prosecutor Ralph Devlin
earlier claimed a "bubbling" event happened on the ground after
rainfall at the coal gasification site.
Mr Arnold told jurors
that after discussing the oozing substance, concrete trucks turned up and he
pumped the concrete into a well.
Mr Arnold said he felt
the concrete used that time was "very light" but the on-site
supervisor made that decision.
Prosecutors previously
told the court concerns were raised at various times with Linc leadership about
the quality of cement and geological data used at the site.
The Crown has also
claimed Linc used its underground wells in a way that made them fail, and
allowed contaminants to escape far way, to places Linc could not remove them.
BACKGROUND
Linc started its
Chinchilla Demonstration Facility in July 1999. First gas was produced in that
very same year. Initially Linc Energy used the underground coal gasification
technology worked out by Ergo Exergy Technologies, Inc, of Canada.
However, in
2006 the cooperation with Ergo Exergy was terminated and the cooperation
agreement for technology usage, consultation and engineering services was
signed with the Skochinsky Institute of Mining and
the Scientific-Technical Mining Association of Russia.[2]
In 2005, Linc signed a
memorandum with Syntroleum granting a licence to use the Syntroleum's
proprietary gas-to-liquid technology and started to build a
GTL pilot plant in November 2007 at the Chinchilla facility. The plant was
commissioned in August 2008. The first synthetic
crude was produced in October 2008.[3]
