What's next for hydraulic fracturing in Western Australia?

by Martin Klapper and Helen Liang

A brief summary

Over the last two years, the Western Australian Parliament’s Standing Committee on Environment and Public Affairs has conducted an enquiry into the implications for Western Australia of hydraulic fracturing for unconventional gas – an onshore activity that aims to release natural gas from reservoirs for principally domestic use in Western Australia.

The report was released on 17 November 2015. A link to that report is provided below.

Partner Martin Klapper, Special Counsel Anne De Soyza and Solicitor Helen Liang discuss the implications of this report in the following Alert.

What the report says

The committee found that hydraulic fracturing is not necessarily a bad thing; the State is unlikely to experience negative effects from induced seismicity as a result of hydraulic fracturing.

With regard to ground water contamination, the committee concluded that the risk from hydraulic fracturing intersecting underground water aquifers was “extremely remote” as was the risk of fugitive methane contamination of ground water.  The Committee noted that surface spills of hydraulic fracturing fluids may prove a greater risk than the fracturing process itself; though the risk can be effectively managed through the existing environmental protection regime.  However, the Committee did find that there should be ongoing assessment of the environmental effects from hydraulic fracturing through baseline data gathered by regulatory authorities.

The findings on environmental questions can’t be read in isolation – the committee also found that the future exploitation of gas resources in Western Australia will rely on the notion of recovery being socially acceptable as well as economically and geologically possible.  

Ongoing consultation with the community is essential for a continued social licence to operate, and the views of directly affected communities should hold significant weight in any decision making relating to the development of an unconditional gas industry in Western Australia.

In short, there has to be a balance between development and community views, addressing genuine concerns through transparency and rigour in administration of regulatory approvals and oversight, public availability of credible information about the risks of hydraulic fracturing gathered from data and baseline monitoring of water sources and local geology and therefore:

“that any future consideration of hydraulic fracturing for unconventional gas in Western Australia  be based on established facts, ascertained through baseline data and monitoring, with a view to strengthening the industry’s social licence to operate.”

This is not to suggest that the report only deals with direct and indirect effects of hydraulic fracturing and the social licence to operate – quite the reverse.  The committee made detailed findings on issues such as:

  • whether Western Australian law contains adequate penalties to deter improper or unlawful behaviour; the committee found that existing laws do not contain adequate penalties;
  • whether Western Australian law meets the Department’s stated intention of transparent and open communication and engagement with the public regarding hydraulic fracturing; again the committee found that the existing law was not sufficient for that purpose; and
  • the committee also pointed out the potential and perceived inequality of power between resources companies and landowners, including for access to land and hydraulic fracturing, and made recommendations about ways in which any such inequality can be addressed.

So what’s next?

The report contains 51 findings and 12 recommendations.  The Western Australian government’s response to the report is due from 16 February 2016, when the Parliament reconvenes for the 2016 sitting year.

We will provide an update as soon as the government’s response is known.

You can read the report at the following link

For more information on this or any other Resources and Energy matters, please contact Martin Klapper in HopgoodGanim Lawyers’ Resources and Energy team.  

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