Australia is a country with large reserves of coal seam gas, for which there is a local and global demand.

The Australian Government environment minister is responsible for assessing and making decisions on coal seam gas proposals if those proposals are likely to impact on matters protected under national environment law – the Environment Protection and Biodiversity Conservation Act 1999 (the EPBC Act).

The Australian Government environment minister cannot intervene in a proposal if it is not likely to have a significant impact on a matter of national environmental significance, even though there may be other likely environmental impacts.

This is not because these other environmental matters are not important. It is because, under the division of powers between the Australian Government and the states under the Australian Constitution, it is the states that have the primary responsibility for environmental protection. In contrast, the Australian Government environment minister only has authority over defined matters of national environmental significance. The Australian Government environment minister also has authority over proposals taken on or that may impact on Commonwealth land, or actions undertaken by Commonwealth agencies.

Australia's states and territories are responsible for assessing and regulating coal seam gas projects generally.

Conditions imposed under national environment law can only relate to the protection of nationally protected matters. These matters include, for example, nationally listed threatened species and migratory species. Conditions on the three projects that have been approved under national environment law were imposed having regard to expert scientific advice, including advice from Geoscience Australia on hydrogeological matters. A summary of that advice from an expert panel established to look at those three projects, and copies of the conditions imposed under national environment law, are available at:

• Coal seam gas water management expert panel

In making decisions under national environment law, the minister may take other matters into account, including impacts on water, agricultural land, and economic and social matters. However, the conditioning and regulation of these matters is a state responsibility.

The Australian Government Department of Sustainability, Environment, Water, Population and Communities has established a dedicated enforcement and compliance unit to ensure the Commonwealth conditions are implemented.

In addition to its regulatory role, the Government has committed to introducing a new science-based framework to provide certainty for regional communities on coal seam gas and large coal mining developments, jobs and investment, as well as better protection for water resources.

The Government will establish a new Independent Expert Scientific Committee that will provide scientific advice to governments about relevant coal seam gas and large coal mining approvals where they have significant impacts on water; oversee research on impacts on water resources from coal seam gas and large coal mining projects; and bioregional assessments for priority regions.

A new National Partnership Agreement will also be established with the states through COAG, agreeing that the Commonwealth and states have to take into account the advice of the Committee in their assessment and approval decisions.

An interim committee has been formed pending the formal establishment of the committee under legislation.

Terms of Reference for the Committee and more information about the committee are available at:

• Interim Independent Expert Scientific Committee on Coal Seam Gas and Coal Mining

Key activities for the Committee include:

• advising on research priorities;
• advising on bioregional assessments in areas of high potential impact from coal seam gas and/or large coal mining developments, including providing advice to the Commonwealth Minister for the Environment on the priority areas in which these assessments should be undertaken;
• scoping and overseeing research and bioregional assessments commissioned by the Commonwealth Minister for the Environment following consideration of the Committee’s advice;
• providing scientific input to support the development of best practice standards in relation to the protection of water resources through the planning, implementation, management, monitoring & rehabilitation of coal seam gas and large coal mining developments; and
• providing Commonwealth and state governments with expert scientific advice relating to coal seam gas and large coal mining development proposals that may have a significant impact on water.
• An Interim Committee has been formed pending establishment of this new Committee under the Environment Protection and Biodiversity Conservation Act 1999.

The Committee will be an independent statutory committee established under the Environment Protection and Biodiversity Conservation Act 1999, and will be supported by a dedicated, specialist office within the Department of Sustainability, Environment, Water, Population and Communities.

The expert panel on major coal seam gas projects was established to advise the federal environment minister on the three coal seam gas projects in that state, which have already been approved under national environment law.

The new Independent Expert Scientific Committee on Coal Seam Gas and Coal Mining is a $200 million commitment by the Federal Government that will provide advice to the federal environment minister and other decision-makers about all coal seam gas and large coal mining developments in Australia that are likely to have a significant impact on water. The new committee will take a much broader perspective on the issue, however, the two will still work in parallel with each other.

Not always. It depends on whether the proposal is likely to have a significant impact on something protected under national environment law. Those protected matters include nationally and internationally important flora, fauna, ecological communities and heritage places defined in the EPBC Act as ‘matters of national environmental significance’.

If a proposal is not likely to have an impact on any of those things, then approval is not required under national environment law.

Assessments of coal seam gas projects is taken very seriously by both the minister and the Australian Government environment department. In making a decision whether or not to approve a project, the minister must operate within national environment law.

In making decisions under national environment law, the minister may take a broad range of matters into account including economic and social matters, such as impacts of a project on agricultural land, economic and social benefits/detriments of a proposal, and community views. The minister may also consider cumulative impacts.

The regulation of the coal seam gas industry is primarily the responsibility of state and territory governments.

Three coal seam gas projects – all in Queensland – have been approved under national environment law. Those projects are also subject to state regulation for matters of state responsibility. State matters include addressing broader environmental protection, regional and landholder interests, access to land, waste management, and social and economic matters.

The Queensland Government has established an ‘LNG Enforcement Unit’ to monitor CSG operators and to ensure they comply with state laws and policies affecting the industry.

Links to further information on state regulation are below, under the heading ‘Where can I get further information?’

The Australian Government Department of Sustainability, Environment, Water, Population and Communities administers two pieces of legislation relevant to the CSG industry:

• the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act)
• the Water Act 2007 (Water Act).

Australian Government responsibilities in relation to the approval of CSG projects and other development proposals are primarily concerned with the protection of matters of national environmental significance defined under the EPBC Act.

The EPBC Act sets out the role of the Australian Government in protecting matters of environmental significance and regulating actions involving the Australian Government or affecting Commonwealth land.

Further information about the EPBC Act is available at:

• www.environment.gov.au/epbc/index.html

The minister imposed about 300 conditions on each of the three approved coal seam gas projects, including impacts that relate to aquifers and groundwater-dependent species. These projects are proposed by Santos (EPBC 2008/4059), the Queensland Gas Company (EPBC 2008/4398), and Australia Pacific LNG fields (EPBC 2009/4974). All these projects are in Queensland.

The implementation of the conditions will be monitored and enforced by the Australian Government Department of Sustainability, Environment, Water, Population and Communities. Copies of the conditions are available at:

• Gladstone coal seam and dredging projects

The conditions cover each aspect of the projects and include requirements relating to constraints planning, environment management plans, disturbance limits, remediation, offsets, CSG water management, regional groundwater modelling, springs assessments and monitoring, cumulative impacts, and decommissioning.

It is important to note that conditions imposed under the EPBC Act relate to avoiding or mitigating risks or impacts on Commonwealth protected matters. The regulation of water more generally is a matter for state and territory governments.

Strict Commonwealth conditions have been imposed on coal seam gas mining operations for protecting groundwater and water quality in relation to nationally protected matters, including groundwater dependent springs. These and other conditions were imposed as conditions of approval for the QGC gas fields (EPBC 2008/4398), the Santos gas fields (EPBC 2008/4059), and the Asia Pacific LNG gas fields (EPBC 2009/4974).

Under the conditions, strict water drawdown limits have been applied for each aquifer relevant to gas field development. The conditions allow the companies to demonstrate, to the satisfaction of the minister, that an aquifer is not hydraulically connected. If the proponent can demonstrate this, then the groundwater threshold values and required response measures would not apply for that aquifer. However, ongoing monitoring of connectivity and drawdown for such an aquifer is still required.

The proponents must provide detailed water management and monitoring plans for the minister's approval, on the advice of an expert panel. Once the minister approves those plans, the companies must comply with them. The plans can be adaptively revised when needed, for example, based on better data, subsequent stages of gas field development, and the need for continuous improvement.

The water management and monitoring plans must include, among other things:

1. groundwater drawdown limits for each targeted aquifer
2. a program and schedule for aquifer connectivity studies and monitoring of relevant aquifers to determine hydraulic connectivity
3. a program and schedule for field piloting of aquifer reinjection of treated CSG water and other groundwater repressurisation techniques
4. early warning indicators where drawdown thresholds are being approached
5. the estimated number and the spatial distribution of boreholes where hydraulic fracturing may be necessary, an annual review of the estimate, and recording of actual use
6. details of constituent components of any hydraulic fracturing agents and any other reinjected fluid(s), and their toxicity as individual substances and as total effluent toxicity and ecotoxicity, based on methods outlined in the National Water Quality Management Strategy
7. an ongoing water quality and quantity surface water monitoring plan that includes at least:
   1. identification of the surface and aquatic systems to be monitored and their environmental values, water quality, and environmental characteristics, and the rationale for selection
   2. the number and locations of monitoring sites upstream and downstream of proposed discharge of CSG water (whether treated water, amended water or raw water), including test and reference sites upstream and downstream and before and after any proposed impacts
   3. the frequency of the monitoring and rationale for the frequency
   4. baseline data for each monitoring site for comparison of monitoring results over the life of the project
   5. the approach to be taken to analyse the results including the methods to determine trends to indicate potential impacts
   6. threshold values that protect relevant MNES (such as reporting or control line values for additional investigation, more intensive management action, make good, and cease operations) at which management actions will be initiated to respond to escalating levels of risk and designed to protect water quality and the associated environmental values of surface and aquatic systems
   7. water treatment and amendment methods and standards
   8. water storage locations and volumes including any storage and volumes required to pilot or implement reinjection or other groundwater repressurisation techniques
   9. water use or disposal options and methods (whether for beneficial use or not) including frequency, volumes, quality and environmental values documented for each receiving environment
   10. brine storage locations and volumes, and brine crystal waste management
   11. emergency water discharges, their volumes and quality
   12. references to standards and relevant policies and guidelines.

Importantly, the plans must include a response plan, to be activated if groundwater thresholds are exceeded. For this purpose, the companies must develop a program for groundwater repressurisation using re-injection of CSG water to re-establish pressure levels and water qualities to the satisfaction of the minister. The design of these groundwater repressurisation activities must be informed by a regional-scale groundwater model.

Under the EPBC conditions, the companies must develop a regional groundwater model of the effects of multiple coal seam gas developments in the Surat and Bowen basins. This requirement may be satisfied by companies contributing to modelling work being undertaken by the Queensland Water Commission.

Further information on the Queensland Water Commission's work in relation to coal seam gas is available at:

• Queensland Water Commission - The role of QWC 

In addition, the companies must provide a cumulative impact report relating to all listed species and ecological communities within and outside the project areas. Under the conditions, the minister can request the companies to revise the plans if the minister believes it is necessary for the better protection of matters of national environmental significance. This may occur in response to the cumulative impact assessment.

The companies are required to strictly comply with the conditions imposed under national environment law. Substantial penalties can apply for infringement of conditions, including penalties of up to $1.1 million for contravention of a condition.

The Australian Government will ensure that the conditions are implemented so that long-term protections remain in place. The Commonwealth Department of Sustainability, Environment, Water, Population and Communities has established a dedicated section in its Compliance and Enforcement Branch, to manage the implementation of the Commonwealth conditions on coal seam gas projects.

The Commonwealth Water Act 2007 relates to the management of water in the Murray Darling Basin (MDB). Under the Act, a Basin Plan is being developed that will set sustainable diversion limits, or limits for water ‘take’ from the MDB water resources by users, including mining operations, within the overall sustainable diversion limit. In the MDB, state water resource plans will have to comply with limits in the Basin Plan. This does not apply to water taken from the Great Artesian Basin.

Under section 255AA of the Water Act an independent, expert study must be undertaken prior to licenses being granted for subsidence mining operations on floodplains which have an underlying groundwater system that is part of the MDB inflows. Such a study was released in December 2010, relating to the impacts of the mining operations on the connectivity of the groundwater systems, surface water and groundwater flows, and water quality.

The issue of landholder's rights, in relation to land access and mining activity, including any compensation, is regulated by state law.

Coal seam gas developments have occurred in Queensland and New South Wales. Further detail on policies announced in Queensland and New South Wales, in relation to agricultural land, can be found at the following websites:

Queensland

• Department of Environment and Resource Management > Strategic cropping land 
• Department of Environment and Resource Management > Land access 

New South Wales

• Department of Planning and Infrastructure > Strategic Regional Land Use 
• Department of Primary Industries > Minerals & petroleum titles landholder's rights 

Fraccing (also called ‘fracking’ or ‘hydraulic fracturing’) is a process that uses the hydraulic pressure of fluid (water or gel with ‘proppants’ such as sand added), pumped into gas wells to open coal seams and help increase gas production. The sand props typically open one or two millimetre wide cracks in the coal seams, created under pressure, which allows gas to flow.

Fraccing is not used is all coal seam gas operations. It depends on the regional geology, and whether it is necessary to recover gas from the coal seam.

Further information on fraccing can be found by following the links below, under the heading ‘Where can I get further information?’.

In relation to Queensland, where three projects have also been approved under the EPBC Act, the Queensland Department of Environment and Resource Management provides information on fraccing at:

• Fraccing 

A number of detailed studies have been undertaken, or are ongoing, in relation to impacts relating to the coal seam gas industry.

Major projects that have been approved under national environment law have been the subject to detailed expert advice on hydrogeological matters. A summary of that advice is available at

• Gladstone coal seam and dredging projects

Under the Water Act, a study relating to CSG operations in Queensland was completed – the assessment of impacts of the proposed CSG operations on surface and groundwater systems in the Murray-Darling Basin. The report was released on 10 December 2010. It is publicly available at:

• Assessment of impacts of the proposed coal seam gas operations on surface and groundwater systems in the Murray-Darling Basin (PDF - 3.3 MB | (Word - 8.9 MB)

The Australian Government is also funding a number of substantial research proposals into the groundwater, including:

• The National Groundwater Assessment Initiative is the centrepiece of the Groundwater Action Plan under the Raising National Water Standards Program. The $50 million initiative is funding hydrogeological investigations to help overcome critical groundwater knowledge gaps. For more information visit:
  • National Water Commission - National Groundwater Assessment Initiative 
• The Healthy HeadWaters Program is examining the use of coal seam gas water in addressing water sustainability and adjustment issues in the Queensland section of the Murray Darling Basin (QMDB). The $5 million project is managed by the Queensland Department of Environment and Resource Management and funded under the Australian Government's Water for the Future initiative. For more information visit:
  • State Priority Projects - Queensland Healthy HeadWaters
• The Namoi Water Study is intended to provide high quality information to help identify the risks associated with mining on water resources in the region, and to inform the NSW and Australian governments' decision-making processes. The completed report and its findings are due mid 2012. The Australian Government is contributing up to $1.5 million towards the joint study into the surface and groundwater resources of the Namoi Catchment in New South Wales. For more information visit:
  • Namoi Catchment Water Study 
• The Great Artesian Basin Water Resources Assessment (GABWRA) aims to reconceptualise the hydrogeology of the Great Artesian Basin and assess the potential impacts of future development including CSG. The project is scheduled for completion by December 2012. The study costs $6.25 million and is funded by the Commonwealth.
• Studies are also being undertaken at a state level. For example, the Queensland Water Commission (QWC) is undertaking work to develop a groundwater flow model (which will be updated every three years) using baseline public and CSG company data. The QWC is also undertaken surveys of groundwater springs to identify which springs, including those EPBC Act listed, that may be impacted by the CSG developments. The Queensland Government is also initiating a regional modelling framework to model regional groundwater impacts in terms of magnitude, extent and timeframe.

Information on the EPBC Act is available at www.environment.gov.au/epbc/

Information on the EPBC Act conditions on approval of coal seam gas projects, including on  the Interim Independent Expert Scientific Committee on Coal Seam Gas and Coal Mining and the independent expert panel established to provide advice to the Commonwealth environment minister, is available at:

• Interim Independent Expert Scientific Committee on Coal Seam Gas and Coal Mining
• Coal seam gas water management expert panel

Information on the coal seam gas industry is available on the website of the Australian Government Department of Resources, Energy and Tourism:

• Coal Seam Gas Water Management Study 

Information on State regulation of coal seam gas, including policies and guidelines, is available at the following websites:

• Queensland – Department of Environment and Resource Management 
• New South Wales – Department of Primary Industries 
• Western Australia – Department of Mines and Petroleum 
• Victoria – Department of Primary Industries 
• South Australia – Department for Manufacturing, Innovation, Trade Resources and Energy 

There are also parliamentary inquiries relating to the coal seam gas industry:

• Senate inquiry into the management of the Murray-Darling Basin 
• Parliament of New South Wales > Coal Seam Gas (Inquiry )