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Doubts raised on landowner mining royalty payments
March 17, 2017
Livestock SA is seeking clarity on the State Government’s plan to return 10 per cent of royalties for gas extraction to landowners, announced as part of the South Australian Power for South Australians plan this week.
Gas extraction on agricultural land can involve the controversial process of hydraulic fracturing, or fracking, a process which Livestock SA has called for the government to halt.
This was due to concerns about the use of fracking as a relatively new and untested technology and its potential to damage the underground aquifer system, issues with land access and conflict with livestock production.
Livestock SA Chief Executive Officer Andrew Curtis said information on how the PACE Royalties Return Scheme would work, or who would be entitled to royalties, needed more detail.
“It appears to be a simplistic response to a very complicated issue,” he said. “There will be no royalty payments until there is productive extraction from a gas well, yet a lot of damage can be done to agricultural land in the exploration phase of mining using hydraulic fracturing.
“There is also the question of who gets paid the royalties? Currently the legislation refers to ‘landowners who have gas extracted from underneath their land’. Hydraulic fracturing allows sideways drilling so how will it be known which property the gas comes from to determine which landowner receives payment?”
Mr Curtis said the South East was an economic powerhouse for the state when it came to livestock production, with the region so highly productive because of its vast underground water reserves.
“So, the risk of any gas well leakage or failure is extremely concerning,” he said.
“Livestock SA continues to advocate for livestock producers on this issue, and believes that no fracking should be conducted in these regions.”