Matthew Canavan (Queensland, Liberal National Party) Share this | Hansard source

It is great to rise on this topic. I suppose one of the good things about being new here is that you do not know what is going on half the time, and I got caught short there a little bit, getting called up. Another is that it was not that long ago that I was out in the real world, so to speak, and involved in real-world issues rather than just talking about real-world issues. Just before I came to the Senate, I worked for a beef company, and in that beef company we actually negotiated coal seam gas licences and we were negotiating with a coal seam gas company about some water use. I want to just say a little bit about my experiences doing that, because a lot of this debate is driven by things that come second or third hand to people. We cannot really understand what people's experiences are. Both in that role—in a business role—and in this role in the Senate, I have been to see both the coal seam gas companies and farmers impacted by coal seam gas, but we cannot put ourselves in people's shoes.

My experience with the coal seam gas industry is not a completely positive one, but it is not a completely negative one either. First of all, there are, of course, protections in the laws of Queensland—and all states—that regulate the coal seam gas industry. The industry has obligations to make good and to try to come to an agreement with landowners before they operate. In this case, an agreement was made between the beef company and the coal seam gas company for 24 wells. While it was not an outcome that was particularly attractive to the beef company, it was done on a voluntary basis.

I have to say that the most difficult thing in negotiating on these issues is the pure imbalance that exists between the rights of landowners and the rights of the coal seam gas companies. That is what makes it difficult in this environment. If it were simply a business deal where you negotiate an agreement to sell oranges or buy apples, you could see a situation where people walk away with mutual benefit. When you come to most business deals, unless you have mutual benefit, you will walk away from the table and there will be no deal. But in this case you do not have that situation, because, at least in Queensland, the law prescribes that if you do not reach an agreement after 40 business days—sorry, I think it was increased to 50 business days in the last few years—you have to let the company on your land, and a court will determine what the rate of compensation would be.

Earlier in the debate, Senator Williams mentioned that both AGL, which I think he mentioned, and Santos have assured him that they will not go onto people's lands without their approval, and that is what they tell me too, but the reality is that, when a farmer or landowner sits down and thinks, 'Should I take this to court and oppose this coming onto my property?' they do not have a lot of leverage, because the clock is ticking: after 50 business days, they get to come on the land. So normally it is in the landowners' best interests to reach an agreement within that 50-day window so they do not have to go to court and pay legal fees and they can get something rather than maybe nothing.

That imbalance makes it difficult. It tilts the balance towards those that want to extract gas and against those that may have other priorities and issues. I think a lot of the heat and issues that exist in this debate could be resolved if we simply gave landowners more of a say on what happens on their land. We on this side of politics believe in private property rights. We believe that people should have a say in what happens to the property that they own. In this instance, there are people who have bought land and maybe passed that down through generations. They should have a right to have a decent say about what happens on their property. That right is not inviolable. It is not a fundamental human right in the sense that it cannot ever be abrogated by the state. Even if you live in the city, sometimes you might have to sell your house if the government wants to put a road through it. Sometimes there is a public good where you have to have your property compulsorily acquired, but that should be the exception, and there should be exceptional circumstances when it happens. I am not quite sure these circumstances exist in this case.

As Senator Williams said earlier, we actually had a system in this country where the mineral rights were owned by the landowners. A lot of people on the other side of the debate will say it is a state resource; the state owns it, and the state should have the right to regulate it and benefit from it. That has actually not always been the case. It has been the case for a much shorter time than people realise. In the case of New South Wales, it was actually Neville Wran that took landowners' rights away from them in the Coal Acquisition Act 1981. That is about the same time I was born. The Coal Acquisition Act 1981 took the rights to own the coal, to say what happened to that coal and to benefit from that coal away from farmers and landowners and vested them in the state to sell to mining companies and to extract royalties from. That decision happened with no compensation to landowners—none at all. It was simply a bill of parliament. Later on, the Greiner government was elected, and it instituted a process to give some compensation to landowners, because it was a huge issue in regional New South Wales, as you can imagine.

In Queensland it happened a lot earlier: it happened in 1915. I cannot remember the name of the act, but I remember getting it from the Queensland parliament. It was a two-page act, and it basically just said that all petroleum and gas previously vested in private hands is now vested in the Crown. That was it—done. Those rights were taken away from them with no compensation and no remuneration. We are nearly 100 years on from that. I suppose this year we are 100 years on from that act in Queensland, so we have had a century of government ownership and control over petroleum and gas resources. I recognise that we are not going to go back to the pre-1915 situation, where landowners actually owned the petroleum and gas. Unfortunately, that ship has sailed, but I do think we can rebalance the rights that exist, and I do think that would help this issue.

And why do I think that? It is because we have very similar issues here in coal seam gas to those that exist in the shale gas industry in the United States. Sometimes they are conflated. They are actually different technologies and access different parts of the watertable, but they have very similar issues, and they are very different from typical mining operations.

Underground or open cut coal mining will typically come in and buy the properties that are directly affected. They will just buy them up, and the people that get bought out usually laugh all the way to the bank. I know the former member for New England sold some of his property to Whitehaven Coal and made a substantial profit of probably three times, some reports suggest, the average market value for that land at the time that was going. That is a great deal if you can get it, and fantastic for those people.

But coal seam gas and shale gas are very different because the companies do not buy the land. They just want an easement or an access to the land to drill some wells and maintain 24/7 access to the property for safety and for their industrial needs. That means that there has to be an ongoing relationship between the company and the landowner. That creates tension, and that creates issues. There is no one-off transaction. It is difficult for a coal seam gas company or a shale gas company to pay royalties to the state and overcompensate the landowners because they deal with hundreds of landowners not just a few. We have a situation where it is hard to take the politics out of this issue. It is hard to resolve the appropriate property rights of landowners and our desire to develop our resources and create jobs in regional areas.

In the United States, they have a very different system. In most states in the United States the farmers still own the gas. They still own the shale gas. They still own the oil. They are developing their industry at a great speed, and much faster than us. They are restarting and rebooting their economy, based on cheap energy and large scales of cheap gas that are close to their areas of industrial development. That the US is now back on track, so to speak, is a great thing for the world economy because it is helping prop us all up at the moment. Their unemployment rate is lower than ours now, and their economic growth is high.

A lot of that is to do with the fact that they have cheap gas and cheap power and they are developing. I do not think we should be surprised that, when we allow people to make money from something, they will sign up. When we allow people to negotiate a good price for access to their land, they will sign up and they will develop their property. It is something that should be at the core, on this side of politics, of what we believe in. We believe in that. We believe that, through the private negotiation of rights and services and provision of goods, we will have more wealth created in the economy, and that is what is happening in the United States.

A couple of years ago I was talking to an Australian BHP executive. BHP have a lot of shale gas licences in the United States. He was in a suburb of Louisiana where there was a shale gas hub terminal in the middle of the suburb with houses all around, just like a suburb in Australia. All these pipes were going under houses, and, of course, as an Australian, he said to the Yanks, 'Well, how did you achieve this? If we'd tried this in Australia we'd have no hope.' The Americans said, 'Well, actually, the suburb next door is not happy with us because the gas price has fallen and we're not gonna go in to that suburb now.'

All those houses around that area, all those moms and dads in suburban homes, not farms, were getting a cheque. They were getting a cheque from the gas company because they owned the gas under their house. It was just a backyard with a clothes line and normal barbecue out the back. They own the gas under their land, so they have the right to get a cheque from it. They all supported it, and that is boosting their economy now. But we do not have that situation here.

We have a system where the state owns the gas. It is a communist outcome. It is a communist situation where the state owns the resource. It is a national resource, and it is exactly what the Labor Party like. It is not what we want; it is what they want. They want a communist outcome. And what are we getting? We are getting a communist solution to a communist situation. We are getting no production. We are getting lines of industrial companies, like breadlines in the Soviet Union, waiting and lining up for gas because we cannot get cheap gas for our industry. We should not be surprised. It did not work in Russia, guys. It does not work in Korea. It does not work in Cuba, and it does not work in our gas industry here in Australia, surprise, surprise.

I do applaud the Greens. Normally I associate the Greens with communism.