By Ross Verne
NEW SOUTH Wales lawmakers will continue to alienate communities and cost companies unless they stop following in Queensland’s footsteps on CSG, petroleum law expert Tina Hunter says.
Queensland’s CSG laws were described by Dr Hunter as “regulatory overkill”, where legislation is multifarious and clouded – and up until now, she says, they have had the greatest influence on NSW’s CSG regulation.
“NSW is looking at Queensland as the leader – and they’re not,” Dr Hunter said.
Dr Hunter’s comments come almost a month after chief scientist Mary O’Kane released her report into CSG in NSW, where she highlighted a “complex and opaque” legal and regulatory framework as a major detriment to the industry’s future success.
“It can lead to considerable administrative burden for those needing to comply, those assessing compliance and those trying to understand the legislative and regulatory regime,” Dr O’Kane wrote.
Dr Hunter said the Queensland model made companies less efficient, communities more frustrated, and governments less effective at properly regulating the industry.
“Queensland have been held up as the guys in coal seam gas law but a lot of people would say absolutely not,” Dr Hunter said.
“I think it is a lack of understanding and knowledge about what else is out there.”
Dr Hunter said there was a fundamental problem with the “prescriptive” nature of NSW and Queensland legislation, with an “unhealthy” tendency for aspects of regulation to creep into legislation.
“The prescriptive way doesn’t work for one reason – if you tell a company not to do something they will find something they can do,” she said.
Dr Hunter said NSW’s principal petroleum act was “very good” but there was a need to implement separate regulations to compliment it.
“The legislative act is the what, the regulation is the how. Lots of legislative bodies try and put the what and the how together – that is not how you do it,” she said.
Dr Hunter said NSW should be looking to learn from the Western Australian and South Australian approach, one she says takes an objective position and views the entire petroleum industry under one umbrella.
“They recognise that coal seam gas is just one type of petroleum activity so therefore they regulate it the same way as any other conventional petroleum activity,” she said.
Professor O’Kane has recommended is that all subsurface resource extraction be covered by a single act.
Dr Hunter said the 14 principal acts that cover CSG could be slashed by more than half, to about six.
“Complex legislation doesn’t make for better regulation – you actually create regulatory gaps.”
She said poor legislation in Queensland and NSW came about as a result of overzealous lawmakers’ attempts to be seen to be protecting their communities.
“If you’re a member of the public that is crying out for regulation – with an industry as controversial as CSG – the only way you can regulate from a public relations point of view is by making lots of rules,” she said.
“But the more complex a system is, the less transparent it becomes.”
She said industry had lost time and money due to the need to commit resources to tackling exhaustive legal requirements and communities had lost faith in the government because of a lack of consistency.
“If someone sees the government changing the law all the time, you get the feeling they don’t know what they’re doing,” she said.
Dr Hunter also said the extent of knowledge needed to wade through regulatory frameworks meant industry players were regularly poaching government employees because they were the only ones with the inside knowledge to cut through red tape.
The NSW government is yet to respond to the report’s recommendations but energy minister Anthony Roberts said greater transparency in the east coast gas market was a priority.
Shadow energy minister Adam Searle said managing regulatory frameworks was an ongoing task and he looked forward to hearing the government’s response to the chief scientist’s report.
Dr Hunter said lawmakers should look for examples of effective legislation and build a system specific to the state’s needs.
“NSW needs to cast their net around the world and look at what are the characteristics of a great framework,” she said.