As part of the NSW Gas Plan, IPART are developing a framework for setting benchmark compensation rates as a guide for NSW landholders negotiating land access agreements with coal seam gas companies. The review is looking solely at compensation benchmarks to be used as a guide for negotiations between landholders and gas companies. The granting of licences, environmental controls, extraction techniques and the impacts of gas development on local communities are outside the scope of IPART’s review. 

IPART Chairman Dr Peter Boxall said that rather than adopting a ‘one-size-fits-all’ approach to landholder compensation, IPART is proposing a bespoke model that allows landholders to estimate compensation benchmarks using information that is specific to their circumstances. 

“Landholders are in the best position to determine what compensation is appropriate for them, but the model would provide a guide to assist in their negotiations with gas companies,” Dr Boxall said. 

In addition to the benchmark model, IPART’s Draft Report into Landholder benchmark compensation rates also recommends additional measures including broadening legislative provisions to ensure landholder compensation in NSW is at least as good as elsewhere in Australia; funding negotiation workshops to provide landholders with independent, practical advice on approaching land access agreements, and establishing and maintaining a voluntary public register of compensation payments to improve transparency of dealings with the gas industry.

Feedback is also being sought on a draft recommendation that benefit or incentive payments to landholders should be funded by gas companies as part of their compensation arrangements, and whether or not neighbours should also receive compensation.

“Stakeholders had different views about whether compensation should be paid to neighbours,” Dr Boxall said, referring to the NSW Government’s Community Benefits Fund which  he said should provide benefits to neighbours and broader communities in which the gas industry operates. 

“Our draft recommendation is that while any potentially impacted neighbours should be identified, compensation should only be required if there is agreement that impacts such as noise or operating hours may exceed reasonable levels set out in environmental or planning approvals.” 

Responding to the review, AGL’s head of land and approvals Suzanne Westgate said that the IPART’s draft recommendations reflected AGL’s input and “is a positive step for the industry and for landholders in NSW.”

“We agree that treating each landholder individually, and basing compensation on their own circumstances is far better than a one size fits all approach,” she said.

But Groundswell Gloucester’s vice-president David Hare-Scott remained concerned that the issue of compensation for landholders continued to leave the larger community out.” 

“Rolling the ‘benefits’ or ‘incentive’ payments into compensation is dodging the issue of benefits beyond fair compensation being used as bribes and the inequity because the resource is actually owned by all Australians not the individual,” he said.

Welcoming the voluntary register of previous dealings as a benefit to landholders in future, he expressed concern it stopped short of forbidding confidentiality clauses within each agreement (which would effectively hinder the efficacy of the register).

He said the provision of professional support for landholders during negotiations with miners was a “welcome benefit long overdue,” but that indemnity against any future loss had not been addressed.  

“The issue of primary producers being liable [for their cattle] through national vendor declarations, when potential pollution from CSG is out of their hands has also been ignored.”

IPART is inviting submissions on the Draft Report by October 30, with public forums scheduled for Narrabri (October 13) and Gloucester (October 20) where the community will have the opportunity to comment and ask questions. More details at www.ipart.nsw.gov.au.

IPART will provide final recommendations to the Minister for Industry, Resources and Energy by the end of November 2015.

---

Any risk to livestock carried by farmers

Livestock industry group Safemeat said that producers are responsible for undertaking a property risk assessment to ensure they are aware of any potential areas of contamination and take appropriate management steps to avoid the risks (this could include excluding stock from risk areas if necessary). 

“Where circumstances change, it is the producer’s responsibility to update the property risk assessment.... If a producer is concerned about the risk of contaminated water, the producer should raise the matter with the state mining regulator and ask it to investigate. If there is an issue of residue concern, the mining regulator should then pass it on to state agriculture department for decision on any steps needed to manage the risk. This may include advice back to the producer on what to disclose on the NVD... In the event that any concerns are raised by environment protection agencies, or state agriculture departments, SAFEMEAT has a range of measures which it could initiate to monitor livestock which may have been exposed to such risks (measures include traceability systems, residue monitoring programs and assignment of statuses). 

Safemeat recommends producers get water testing carried out prior to commencement of drilling for CSG on their property or in their area. 

​