Monday, February 18, 2013

Sinogetically stuffing the basins?

Pulling a few strands months apart together, is there a link between Paul Sheehans story (below) about how the expansion of Coal Seam Gas production is going to impact water availability for downstream food producers with last years agreement to sell Cubbie station to a Chinese consortium (now completed).

We'll reap what we deserve
Paul Sheehan, SMH

Consider this remarkable statistic: according to the maps published by the Queensland Murray-Darling Basin Authority, the area covered by mining leases in Queensland's Murray-Darling catchment area is now 40 per cent.
Think about that. Mining is water intensive. It consumes as much water as agriculture. It is going to be impossible for extensive new mining operations in Queensland not to impinge on the production of food downstream.

Last week, the Federal Minister for the Environment, Tony Burke, granted approval to expand coal seam gas projects in NSW that represent a potential 500 per cent increase in the state's coal seam gas production.

Last month, Cubbie Station, the vast cotton-producing and water-diverting farm operation in the head of the Murray-Darling catchment area in southern Queensland, was sold to a Chinese-led consortium for $240 million.

This was a golden opportunity missed. According to the CSIRO, the cotton industry uses about 1600 litres of water to generate $1 of output. During a 12-year drought, in 2009, Cubbie went into voluntary administration with a debt of $320 million.

Well, how much water are we talking about here? The ABC has the numbers.

How much water will the CSG industry use?
Jun 28, 2012

Australia's Great Artesian Basin and its underground aquifers are a vital source of water; farmers and other bore users are given allocations for their use.

By 2014, the Commonwealth will have spent nearly $150 million under the Great Artesian Basin Sustainability Initiative, capping bores and fixing pipes to conserve water.

The coal seam gas industry is entitled to remove massive amounts of water from groundwater systems.

The Queensland Government says that if CSG mining causes groundwater levels to drop below specified "trigger" points then companies must "make good" to affected water users. The trigger points are:

a five-metre drop in bore-water levels for sandstone and fractured rock aquifers;
a two-metre drop in bore-water levels for alluvial aquifers; and
a 20-centimetre drop in the water table surrounding springs.

While the Queensland Government has set out the make-good arrangements, there is concern over how these will actually work in practice.

There is a fierce debate about the amount of water the coal seam gas industry will extract from underground, and what impact it may have on the sustainability of the Great Artesian Basin.

The industry suggests it will pull out somewhere between 126 gigalitres and 280 gigalitres a year, while the National Water Commission puts the figure above 300 gigalitres a year.
Others, including the Water Group advising the Federal Government, suggest it is higher still.

Which by a happy coincidence is about the same amount as the combined tradable water entitlement of Cubbie Station

Should the CSG bound for China stuff up the Great Artesian Basin, the new imperial overlords owners of Cubbie Station are free to sell (or lease) their water to whomever they so choose. The presence of other large Chinese interests in the area that might be interested in tradable water rights is purely coincidental.

OF course water from Cubbie would never be pumped back upstream in the "unforseen" event that farmers could not use Great Artesian Basin water - which is no ones fault - not even the imperial over owners of Cubbie. What affected farmers upstream could receive is the right to have the water.

Just speculation of course, but I'm reminded of Russ Hinzes convergence of interests.