Qld Farmers Liability Insurance Agreement with Gas Wells – UPDATE
LANDS in Queensland with gas operations on their properties will be able to access general insurance policies for agricultural risks and be properly protected against losses, the Queensland Gasfields Commission confirmed yesterday.
Update: Following the publication of this article, landowner groups affected by CSG infrastructure responded by saying that claims made by the GasFields Commission of Queensland (GFCQ) in a press release that farmers are covered by liability insurance civil rights are “misleading”, and have the potential to “falsely instill confidence in landowners to sign a conduct and indemnity agreement when there is no answer to the question of liability. public insurance post CSG ”.
“Contrary to what the GFCQ claims, the new compensation clause does not provide more clarity to landowners where agricultural and gas infrastructure coexist. Farmers are still fully exposed to post CSG activities if infrastructure is left on or under their land. ”
The landowner group said discussions with two banks recently confirmed that loan terms for farmers’ loans are waived if they no longer have adequate liability insurance.
“The situation has not changed. Farms with any remaining CSG infrastructure, once the CSG industry ends and the buildings have been returned to the government, are not insurable. Ground liaison staff tell landowners that after CSG activity, the lack of liability insurance for residual CSG infrastructure and I quote “is not their problem”. This is certainly the problem with the CSG industry. Landowners have every right to refuse to sign a CCA, which puts them in an untenable position that then allows banks to foreclose on loans. ”
Additional clarifications were requested from the GFCQ on this issue. A statement from the GFCQ provided in response acknowledges that the issue of post-gas landowner liability has not yet been resolved and indicates that all members of the Commission’s working group, which includes landowner representatives and gas companies, have agreed to continue to work together on reviewing landowner liability insurance in areas of “post-gas activity” until clarification is provided to landowners. – Click here to see GFCQ’s response to Beef Central in full
Last year, the big insurer IAG announced it was removing liability coverage from farmers with coal gas operations or infrastructure (CSG) on their properties. IAG’s subsidiaries include WFI and CGU.
At the time The IAG said civil and agricultural liability insurance policies do not cover land and water contamination or the risk of farmers losing their industry accreditation in the event of a spill or failure of the industry. gas infrastructure.
This week, the Queensland Gasfields Commission announced that a new indemnification clause has been developed so that, if the insurer so requires and with the agreement of the landowner and the developer, it can be used to provide coverage. of continuing agricultural liability in Queensland.
The new indemnity clause can be viewed online here: http://bit.ly/GFCQ-Indemnity.
QGC said that after iAG announced its intention to exit the market in mid-2020, it became clear that landowners would benefit from greater clarity and certainty regarding the liability protection in place. ‘they had gas activities on their properties.
The commission said that in order to tackle the problem collaboratively, it has convened a working group made up of key representatives from the Insurance Council of Australia (ICA), AgForce Queensland, the Queensland Farmers Federation (QFF ), Cotton Australia, the Australian Petroleum Production & Exploration Association (APPEA) and relevant ministries.
He said the aim of the task force was to ensure a better alignment of interests between landowners and gas companies and to confirm that landowner liability coverage would continue to be available from a wide range. insurers.
The Commission said the new indemnity clause offered greater clarity to landowners and gas companies where agricultural and gas infrastructure coexist.
He added that since each property owner’s circumstances and insurance needs were different, the indemnity clause was not a “one size fits all” solution.
“The Commission recommends that property owners contact their insurance broker or representative, their insurance provider and the gas company with which they have a Conduct and Compensation Agreement (CCA) if they have any questions regarding their insurance. blanket.
“More wells, less water”
Meanwhile, landowner groups Basin Sustainability Alliance and Property Rights Australia recently raised concerns about the results of the latest triennial report on the impact of groundwater in Queensland.
In a press release titled “More wells, less water” – published on this link – the groups raised concerns, including this;
The number of farm water boreholes immediately affected by CSG’s wells in Queensland is increasing;
To date, only half of the water wells of immediately affected farmers have been repaired;
The same number of bores that are not immediately affected have also been fixed;
The issue of the impacts of free gas on boreholes is not given the same attention by the gas industry or government regulators as in the analysis of boreholes where water levels drop due to the impacts of CSG.
“In Queensland, the area of development of the CSG industry is increasing, the number and density of CSG wells is increasing and the number of farmers’ water wells immediately affected is increasing, but only half of them have been repaired to date, while, inexplicably, the same number of boreholes that are not immediately affected have also been corrected, ”the statement said.
He added that the landowners’ experiences included conflicts in how the rules are implemented in a way that often benefits the gas industry, the time and money to tackle the situation. forced gas-related water problems, and the additional expertise they are required to pay to present their side of the problem, and which they must deal with the Groundwater Impact Assessment Office, the Ministry of Environment, Science and Industry CSG which “triples the complexity and time involved by an order of magnitude for the farmer”.
A spokesperson for the Australian Oil Production and Exploration Association (APPEA) said the gas industry was required by law to repair all impacted drilling, whether the impact was due to the drop in the level of oil. free water or gas.
The Make good agreements were progressively negotiated with the landowners.
The spokesperson said that of the 2 percent of drilling in the Surat Cumulative Management Zone that is expected to be affected in the long term, about 80 percent were taking water from the same coal seams targeted by the industry.
The spokesperson said that to date, in Queensland, the gas industry has negotiated more than 5,700 land access agreements, paid more than $ 500 million directly to landowners who have hosted gas activities since. 2011, concluded water supply agreements whereby over 50,000 ml of water was provided to farmers and communities in 2017 and directly spent $ 50 billion in Queensland since 2011 through corporate purchases and community and government payments