Vic gas ban irresponsible: industry

The Victorian Government has announced a permanent ban on the exploration and development of all onshore unconventional gas in the State, with industry bodies labelling the decision as irresponsible.

In what is a national first, the Government says the permanent legislative ban will protect the ‘clean, green’ reputation of Victoria’s agricultural sector.

“Our farmers produce some of the world’s cleanest and freshest food, we won’t put that at risk with fracking,” said Victorian Premier Daniel Andrews.

“Victorians have made it clear that they don’t support fracking and that the health and environmental risks involved outweigh any potential benefits.”

The 2015 Parliamentary Inquiry into Onshore Unconventional Gas in Victoria received more than 1,600 submissions, most of which, according to the government, were opposed to onshore unconventional gas.

Exemptions to the ban will remain for other types of activities that are not covered by the current moratorium, such as gas storage, carbon storage research and accessing offshore resources.

Exploration and development for offshore gas will also continue.

Until legislation is passed by Parliament, the current moratorium on unconventional onshore gas exploration and development will stay in place.

The Government will also legislate to extend the current moratorium on exploration and development of conventional onshore gas until June 30 2020, noting that fracking will remain banned.

Industry response

The Victorian Government’s decision to permanently ban development of its valuable gas reserves has undermined its own authority as a participant in East Coast gas market reform, said Australian Pipelines and Gas Association (APGA) Chief Executive Cheryl Cartwright.

“Victoria has walked away from investment in State development – from infrastructure and now from energy,” said Ms Cartwright in response to the decision today to legislate against development of coal seam gas.

“As South Australia and the other East Coast gas market participants try to find a solution to the current gas demand-supply imbalance, Victorian has abandoned its responsibilities to the gas market and gas users of Australia.

“The only solution to the current shortage of gas and high prices is to increase supply.

“Gas is a critical fuel for many industries as an input to production or as a critical source of high-temperature waste disposal, such as in hospitals.

“Quite clearly, now that it has abrogated its responsibilities to the East Coast gas market, the Victorian Government should also withdraw from further policy discussion.

“Its opinion has no credibility when it comes to policies that might address the demand-supply imbalance of gas on the East Coast.”

Australian Petroleum Production and Exploration Association (APPEA) Chief Executive Dr Malcolm Roberts said “There is no environmental reason to prohibit onshore gas development in Victoria.

“The technology is proven and safe. In the case of conventional gas, Victoria has had decades of safe local production.

“Every independent, scientific inquiry confirms that, properly regulated, unconventional gas is safe. Activist fear campaigns can create confusion and uncertainty in the community but our political leaders have a responsibility to rise above such campaigns and support an honest, factual debate.

“The decision today is short-term politics that will leave Victoria exposed to unnecessarily high energy prices. In April, the Australian Competition and Consumer Commission warned that Victoria was particularly vulnerable to tight market conditions. The ACCC also rejected the use of moratoriums.

“More than any other state, Victoria relies on natural gas. Almost 80 per cent of homes use it.

“Natural gas is the invisible ingredient for manufacturing – 27 per cent of the gas consumed by industry in Victoria is used as feedstock to make essential products such as glass, bricks and fertilisers. Industries such as dairy and food processing are heavy users of gas.

“Both the Australian Energy Market Operator and the Australia Consumer and Competition Commission have warned of gas supply shortfalls as early as 2019. The government has ignored this advice.”

“Victoria has disconnected from gas market reform,” Dr Roberts said.

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