This article is more than 2 years old

This article is more than 2 years old

Licences needed for coal seam gas exploration in New South Wales have been effectively extended indefinitely past their expiry date, due to a legal loophole.

Gas exploration – both conventional and coal seam gas – in the state requires a petroleum exploration tenement. Analysis of the NSW government’s tenements database shows 14 titles listed under “current titles” that are past their expiry date.



Despite being past the expiry date – some by as much as six-and-a-half years – under NSW law the tenements remain in force until the government deals with the renewal application.



If the government does not approve or deny a renewal application, a tenement can remain in effect without being subject to the safeguards and reporting requirements built into the renewal process.



Most of these licences cover the region known for coal seam gas stretching from the Hunter Valley to the area around the Pilliga state forest that were not captured by the NSW government’s buyback of CSG exploration licences, and one licence covers an area off the coast of Sydney and Newcastle.



No new wells have been drilled while the exploration permits have been past their expiry date. However, late last month Santos submitted an application to the NSW government to connect 12 wells to its Wilga Park power station in Narrabri. The wells are covered by a licence that was scheduled to expire in August 2016.



The power station also uses gas from nearby wells covered by a petroleum assessment lease that was scheduled to expire in October 2013.



A spokeswoman for Santos said the company had submitted renewal applications for its tenements connected to the Wilga Park power station before they expired and “therefore the titles remain effective under the legislation while the government considers and decides the renewal applications”.



The Greens MLC Jeremy Buckingham said the government was effectively allowing CSG companies to conduct “production by stealth” through its inaction on licence renewal applications.



“The coal seam gas companies are being allowed to manipulate the process and use loopholes to run production by stealth,” he said. “They’re effectively operating outside their licence conditions in terms of their intent.”

Labor’s resources and energy spokesman, Adam Searle, said the lack of action on renewal applications, in some cases for years, created uncertainty for tenement holders and land owners.



“I think it’s fair to say the current government doesn’t want to determine these renewals before an election because some of them are in areas where this is likely to be an election issue,” he said.



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“Under a Labor government, there would be a systematic and thorough review of all these outstanding renewals and a determination made.”



George Woods, the NSW coordinator for Lock the Gate, said the renewal process for extractive industries was “really in dire need of reform of NSW and it needs transparency”.



Margaret Fleck is a land owner of a Liverpool Plains property that is covered by an expired exploration licence that is up for renewal. She said community members had written to the government requesting action but without success.



“People are making the decision not to make further investment in their properties with the uncertainty,” she said. “I know families looking to buy new property and they won’t if it’s under an expired licence.”



A spokesman for the NSW planning and environment department said the government was still assessing applications to renew 14 petroleum titles.



“Under section 20 of the POA (petroleum onshore act), the petroleum exploration licences will continue to be in force until a determination is made on the pending renewal applications,” he said. “This means that the titleholders must continue to comply with the conditions of those petroleum exploration licences.”