Home > Sydney drinking water safe, but CSG wells need insurance

Sydney drinking water safe, but CSG wells need insurance

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A report released by NSW chief scientist and engineer Mary O’Kane has found that Sydney Water treatment plants are capable of dealing with the impacts of mining in the Sydney catchment area (SCA).

Professor O’Kane said she had recommended the government create a whole of catchment data repository.

“That will enable better modelling of the cumulative impacts of activities such as CSG extraction and longwall mining,” she said.

The report, 'On measuring the cumulative impacts of activities which impact ground and surface water in the Sydney Water Catchment' said that although the impact of underground long-wall mining in the catchment could lead to small changes in the levels of impurities in water entering SCA’s dams, these changes could be coped with by Sydney Water ’s treatment plants “as evidence to date did not suggest a sufficiently large change in soluble organic concentrations to be of concern”.

It was found that coal seam methane recovery in the catchment area could pose threats to the system through the release of salinity and bicarbonate if storage facilities for CSG production water were overtopped by a severe weather event.

However, the report suggested that the threat posed by CSG process water was minimal due to the small amount of CSG industry in the Sydney basin, and that the main threat would be from stored chemical concentrates for the CSG extraction process.

O’Kane has also released a report entitled 'Environmental Risk and Responsibility and Insurance Arrangements for the NSW CSG Industry', recommending that CSG companies need to take out insurance against any environmental damage caused by CSG operations.

Based on studies of international practices, O’Kane has recommended to the NSW government that appropriate levels of coverage are taken up by the CSG industry to address three primary levels of risk.

These include expected costs in the form of an up-front security deposit to the government; coverage against sudden accidental pollution by CSG wells; and contributions to an environmental fund to address the long term costs associated with rehabilitation, well abandonment or company insolvency.

The report was also critical of the NSW government for its CSG approvals process, relating to licences being approved for “$2 companies” without sufficient equity to make reparations in the event of any problems.

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