Shenhua's Watermark gets green light

08 Jul, 2015 09:59 AM
Shenhua Watermark project manager Paul Jackson.
The Watermark Project will not harm the region’s valuable agricultural enterprises
Shenhua Watermark project manager Paul Jackson.

UPDATED 3:30pm SHENHUA Australia's $1 billion Watermark Project has been approved by Federal Environment Minister Greg Hunt, sparking heated reaction from the project's critics.

In a statement released this morning, the company said the approval was subject to stringent controls under the Environment Protection and Biodiversity Conservation (EPBC) Act 1999.

Shenhua Australia chairman Liu Xiang said the approval was the culmination of more than five years of unprecedented scientific scrutiny during the NSW and Commonwealth government assessment processes.

“With the formal assessment now concluded, we can begin the next phase of the Project, to put in place the strict operating conditions required by both levels of government," he said.

"Our immediate priority is to carefully review the Commonwealth approval conditions to determine if they will have any impact on the project’s technical feasibility and economic viability,” he said.

Agricultural concerns at the fore

The open cut coal mine on the Liverpool Plains has been a point of long-running conjecture and is opposed by environmental lobbyists amid concerns about potential damage to valuable farmland productivity.

Shenhua has spent more than $200 million purchasing farmland for the project and concluded exploratory drilling in July 2012 where it gathered information for assessment including environmental reporting and community consultation.

In February, the NSW government approved the project, which is expected to deliver more than $900 million in economic benefits, 900 local jobs and about $1.5 billion in State government royalties over its 30-year lifespan.

But ahead of the NSW election in March, the issue was referred Mr Hunt to assess under the EPBC Act, which was instigated by Agriculture Minister Barnaby Joyce’s predecessor in New England, Tony Windsor.

At the time of the federal referral, Shadow Agriculture Minister Joel Fitzgibbon accused the Abbott government of using the Water Trigger Bill to “pause” the coal mining project long enough to protect the NSW Baird government from “the public outcry on this contentious project”.

'Ridiculous, unfortunate': Barnaby

Mr Joyce said today the decision to approve the mine was "ridiculous".

"I’ve never supported the Shenhua mine. I think it is ridiculous that you would have a major mine in the midst of Australia’s best agricultural land," he said.

  • READ MORE: Mining on farmland 'ridiculous'

  • "I’ve done everything in my power to try and stop the mine. We brought about further investigations; we had an independent expert scientific review."

    Mr Joyce noted there were still two further steps at the state level to go through following the federal approval.

    "I’ve said publicly and privately I don’t support this mine. I still don’t support this mine and that will remain forever more my view.

    "I think the world has gone mad when apparently you cannot build a house at Moore Creek because of White Box grassy woodlands but you can build a super mine in the middle of the Breeza plains."

    'Strictest conditions in Australian history'

    Mr Hunt said the project had been considered in accordance with national environment law and been approved subject to 18 of the strictest conditions in Australian history, which fully incorporate all advice from the Independent Expert Scientific Committee on Coal Seam Gas and Large Coal Mining Development.

    The Export Committee was formed as part of the Water Trigger Bill initiated by then-New England Independent MP Mr Windsor.

    Mr Hunt said there would be no impact on the availability of water for agriculture.

    “The conditions I have imposed limit water use to less than 0.09 per cent of available groundwater – that’s less than 1/1000th of the resource and less than the amount of water from one agricultural bore,” he said.

    Mr Hunt said the conditions he had imposed have placed the black soil plains off limits for mining, with the project area restricted to the ridge country around Mt Watermark.

    “The conditions I have imposed include the power to stop work and stop mining if there are any impacts on agricultural water supply, and if this occurs, the mine must immediately provide an alternate water supply to farmers,” he said.

    “This approval is stage 15 of a 17-stage process.

    “Before mining can commence a mining lease is required under NSW Mining Act 1992 and I must approve three comprehensive plans to make absolutely sure that water is managed responsibly and the site is properly rehabilitated.

    “There are safeguards to ensure that the mine does not have a bigger impact than predicted, and the community will have an ongoing role in its operation through a Community Consultative Committee.

    “As with all major projects, the Commonwealth Environment Department’s compliance and enforcement officers will be watching the operation very closely.”

    Best available science

    Mr Hunt said he adamant that the project draws on the best available science and asked the IESC to provide additional advice to him.

    He said a total of four expert reviews and two reviews by the IESC concluded that the project’s groundwater modelling was “robust and that actual ground water impacts are likely to be smaller than previous conservative predictions”.

    “Having visited the Liverpool Plains area to listen to concerns of farmers and Indigenous leaders, and having considered hundreds of submissions throughout the approval process, I am well aware of the importance of the productive soils and alluvial aquifers of the Namoi Catchment,” he said.

    “This has been a thorough, comprehensive and science-based process by both the NSW and Australian Governments that has addressed each and every concern about how to protect the environmental values of the site, including the water resources so crucial to the region and its people.”

    A considered decision

    Shenhua Watermark project manager Paul Jackson said Mr Hunt’s decision reflected advice from a number of independent experts, including the Commonwealth Independent Expert Scientific Committee, the NSW Planning Assessment Commission and specialist hydrogeologists.

    “We know the Minister has taken this decision very seriously given he stopped the assessment process to seek advice of the Independent Expert Scientific Committee,” Mr Jackson said.

    “Today’s decision to approve the Watermark Project is the final, irrefutable confirmation there will be no adverse impacts on the region’s groundwater and impacts on sensitive ecological areas have been appropriately managed and offset.

    “The Minister’s decision relies on one of the most comprehensive groundwater studies undertaken in NSW and demonstrates mining can coexist with agriculture while unlocking new opportunities for employment and economic growth in regional Australia.”

    Mr Jackson said Mr Hunt’s approval was the final piece in an overwhelming body of evidence showing the Watermark Project will not harm the region’s valuable agricultural enterprises.

    “After years of rigorous and scientific assessment, it is time to put aside emotive arguments and acknowledge the science clearly shows the Project should proceed,” he said.

    Shenhua said it would now progress the development of a number of operating and management plans which demonstrate how the company will comply with the strict operating conditions imposed by both the NSW and Commonwealth governments. Many of these plans must be approved before any works can commence.

    The Project expects to have these plans ready for assessment by the fourth quarter of 2015.

    'Death warrant' for water resources

    Caroona Coal Action Group CEO Tim Duddy has been an outspoken critic of the project and slammed the government’s decision.

    Mr Duddy called on Mr Joyce, not only as ag minister but also as the local National Party New England MP, to state whether he believed the project should be re-examined by the Foreign Investment Review Board (FIRB) to see whether it met national interest requirements.

    He said Prime Minister Tony Abbott should also support FIRB’s re-examination of the project which threatened water assets linked to valuable farm land.

    “It is very clear that the environment minister does not understand the enormity of the water resources that he has just signed the death warrant for,” he said.

    “We are talking about the most significant underground water resource in the Murray-Darling Basin system.

    "To contemplate that the mine must provide an alternative water resource, if those water assets are harmed, illustrates that Mr hunt should not have carriage of the environmental portfolio.

    “Alternative water resources don’t exist; once that water is harmed its harmed there’s nothing you can do with it.

    “What they’ve failed to understand in all of this is the miners are not consumptive water users they are interceptors in areas that are under state regulations for sustainable yield water supplies.”

    Mr Duddy said he and other opponents of the coal mine project were now investigating their legal options.

    “The community is absolutely behind that and the community is also incensed by the double speak and dishonesty that has come out of every party politician who has touched this project on all sides of politics,” he said.

    Abbott on board

    The Prime Minister was asked about the capacity of mining and agriculture to coexist at the launch of the Agricultural Competitiveness White Paper on Saturday.

    He said there’d been a lot of concern in rural areas and he wanted to assure people who were concerned that “this government would never, ever allow anything that we think threatens the long-term viability of our agricultural sector”.

    “Prime agricultural land is just about this country’s greatest natural asset and it can never, ever be compromised,” he said.

    “We've had coal seam gas extraction now for a couple of decades.

    “There is no evidence that coal seam gas extraction done properly damages water tables.

    “The Chief Scientist of NSW did a very comprehensive report which came out about a year ago and that certainly said that if done properly, coal seam gas extraction can and should go ahead and that's the point.

    “If it's going to happen it's got to be done properly and I would certainly urge state governments to make sure that there are the highest possible environmental standards applied.”

    Guidelines needed: Joyce

    At the National Press club on Monday, Mr Joyce was asked what his government was doing at the federal level to ensure prime farmland was safeguarded from mining industries.

    He said it was “mad” to completely shut down CSG industries where there’s $40 billion worth of investment around Gladstone.

    But Mr Joyce said guidelines were needed as to how it worked including not mining on prime agricultural land and to not destroy aquifers.

    “There is no more prime ag land being built anywhere in the world,” he said.

    “Whatever we have, it's here now, in fact each day there's less of it, so protect it.

    “Aquifers are a public asset and so many people in so many areas rely on them. They rely on them downstream and around and everywhere, so you've got to protect that asset.”

    Mr Joyce said the mining also had to deliver a fair return back to the community and miners and State governments had “got it wrong” by getting “too greedy” towards farmers.

    “If the community sees all this action going on around it, then it would expect that their hospitals to be fixed, and their schools to be refurbished, and their roads to be sealed,” he said.

    “What really annoys people in regional areas, when they see the money from the resources in their area in new tunnels and new freeways in the city because they say, ‘that's just exploiting us’.

    “To be honest, the mines got it wrong, and the State governments got wrong, they all got wrong because they got too greedy.

    “You must make sure a fair return goes back to the farmer.

    “At the start, we were finding (situations where) a well was producing $60,000 a day and the farmer got a case of beer.

    “Another one got $240 a year (and) another one was getting $1500 but he was keeping it a secret.

    “Once these things become exposed, you say well that's just exploitation.”

    Mr Joyce said he thought a fair deal was that no less than 1 per cent of the gross in the well head should be the deal that the farmer gets.

    “That's a pretty good deal because everybody else gets 99 per cent and people argued against it,” he said.

    “They said that was outrageous.

    “Well here's another deal: nobody gets anything.

    “And because people we so tight, because they didn't walk up and do the business, and were fair in their application of how they dealt with those farmers, the mining companies lost their sweet spot in the delivery of those minerals.

    “But if they'd dealt in a fair way, then they would have their product online.

    “There has to be a fair return back to the people whose lives it ultimately affects.”

    Colin Bettles

    Colin Bettles

    is the national political writer for Fairfax Agricultural Media
    Date: Newest first | Oldest first


    8/07/2015 10:26:42 AM

    What happens if it does harm local agriculture? The Govt will fine them, make money from it and leave those harmed with nothing. This is how our legal system works, always in favour of the Govt over the victim. Not everyone impacted has the time or money to make a civil claim. If the mine was in the Sydney basin I bet it wouldn't be approved. The Govt is happy taking the royalties and spending the money in the city. We need another rural state, split from "NSW".
    Rosemary Nankivell
    8/07/2015 11:52:03 AM

    The granting of the Shenhua license is an absolute disgrace. It further illustrates just how far removed decision makers are from agriculture. Both state and federal ministers should hang their heads in shame. They simple don't have the ticker to stand up to Chinese interests - and that certainly does not bode well for other agricultural entities relying on China for trade.
    8/07/2015 6:14:34 PM

    The approval of this opencut coal mine shows clear contempt for the Australian people and future generations. This government is brazen enough to diametrically oppose the lead of well informed nations towards alternative, sustainable energy sources. Our government continues to demonstrate a backwards mindset and this is their hallmark. I hope our farmers remember the manner in which their interests have been disregarded and sold out to big foreign mining business. We must fight this decision for the sake of our farmers and all Australians because we can't eat coal.
    8/07/2015 7:46:55 PM

    Disgusted and will be there when the call goes out to blockade the highway or the coal trains.
    Ted O'Brien.
    9/07/2015 6:33:08 AM

    "Mr Hunt said there would be no impact on the availability of water for agriculture." Somebody has lied. He needs to study history. When the Liddell power station was built in the 1960s, it was designed to operate with sea water cooling. Because it was recognised at that time that drought might at some future time leave insufficient water in the river for the power station's requirements, in which event they would build a pipeline to the sea. But when after 2000 drought did cut the river flow, they did not build any pipeline. They took the water from the farmers.
    Peter Mort
    9/07/2015 12:20:26 PM

    What a surprise! What a Crock! And hot on the heels of Mr Abbott's media comments on the high quality of Australia's agricultural produce, as the recent White Paper on competitiveness in agriculture was released! Do they really think anyone takes seriously the "stringent controls under the EPBC Act (1999)" and "unprecedented scientific scrutiny of government processes" when the outcome is always the same disdain for anything other than $$$! Bunch of puppets! My dad from the old Soil Conservation Service would roll in his grave - if they haven't already dug it up to make way for a coal pit!
    9/07/2015 11:06:33 PM

    Can Shenhua be trusted? I note that the Shenhua Watermark CSR Report references the Ordos Mongolian CCS Project. But it neglects to mention that the carbon being stored is sourced from the very controversial Ordos Coal-to-Liquid plant. Given the issue of safeguarding water integrity in the Breeza plains, the Shenhua CTL Ordos experience makes sober reading. See here: 3/thirsty-coal-two-china/
    N M Pressed
    9/07/2015 11:26:57 PM

    I am reminded of a basic duty of every citizen - refuse to submit to unjust and repressive laws and instead be guided by what is true and just. I would be happy to put my name under a Green Ban, declaring this a project of national repugnance, comfortable in the knowledge that whatever law would seek to prevent me and persecute me for doing so is merely awaiting repeal.
    So disappointed
    10/07/2015 3:13:11 PM

    I have just returned from a holiday overseas where we were unable to drink the water in 5 different countries. After purchasing several bottles of water in the heat wave there I realized how grateful I am to have clean, drinkable water here in Australia. I am also so grateful for all our rich agricultural land our Aussie farmers who've been producing the best food in the world for years. Why the ungrateful sellout now - just money? Will we look back and regret when it's too late?
    10/07/2015 3:24:31 PM

    I heard Mr Joyce on 2GB this morning & all he could say about the Shenhau coal mine was that he had no voice in the decision making by his cabinet colleague, the Minister for the Environment & secondly, it would have been futile if he had because Shenhau would have gone to the courts for redress. Instead, Mr Joyce said that he had sent a letter to the NSW Premier, asking not to give the final approval and Mr Joyce would continue to argue among his colleagues to to reject such mining. I would dearly like to see this letter; and thus see his commitment to the national interest and to agricu
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