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CSG insurance clause ‘tall on spin, light on factor’, lawyer says, in its bid to protect farmers

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CSG insurance clause ‘tall on spin, light on factor’, lawyer says, in its bid to protect farmers

A brand fresh insurance clause is being touted by the coal seam gas industry as a solution to uncertainty about likelihood and liability, but landholders and lawyers convey farmers are serene worse off.

Key points:

  • GasFields Commission Queensland releases an insurance indemnity clause to abet protect farmers from CSG likelihood
  • It follows a fundamental insurer last 12 months announcing it would possibly perchance perchance well no longer offer public liability insurance to landholders who host wells and infrastructure
  • Landholders and lawyers convey it serene does not even the playing field for farmers compelled into negotiation with gas firms

Remaining 12 months, Australia’s ultimate insurer IAG, proprietor of main rural insurer WFI, introduced it would possibly perchance perchance well no longer provide public liability insurance to landholders who hosted coal seam gas (CSG) wells and infrastructure.

Early Newspaper

This week the independent GasFields Commission Queensland (GFCQ) introduced a brand fresh indemnity clause to abet account for concerns about insurance.

“What’s capability is that landholders who host gas activities, including infrastructure on their properties, will seemingly be in a position to continue to procure genuine of entry to common insurance policies for farm likelihood,” acknowledged the acting CEO of GFCQ, Warwick Squire.

Mr Squire acknowledged the clause is possible to be inserted as an amendment to existing agreements between farmers and gas firms.

He acknowledged it would possibly perchance perchance well protect landholders from any likelihood of public liability exposure connected to CSG process, but would not continually be required by insurers.

Multiple gas wells at a farm near Cecil Plains, Queensland in 2020.

An example of gas wells grouped to minimize impression, phase of the Arrow Energy Surat Gasoline Mission come Cecil Plains, west of Brisbane.(

ABC Southern Queensland: Nathan Morris

)

Toowoomba insurance dealer Jason Johnston used to be involved in the negotiation of the fresh clause.

“The current indemnity clause is a lawful document,” Mr Johnston acknowledged.

Nonetheless he acknowledged there would be additional upright payments that would possibly perchance well drop to the landholder.

GFCQ acknowledged insist criminal guidelines required gas firms to quilt costs to landholders relating to resource process.

“The landholder can have to not be out of pocket as a outcomes of any fresh negotiations connected with this clause,” Mr Squire acknowledged.

Peak industry body Australian Petroleum Production and Exploration Association acknowledged landholders can have to talk to their insurer in the event that they’d concerns.

“Gasoline firms have to reimburse landholders for reasonable and obligatory upright recommendation costs incurred in negotiating land procure genuine of entry to agreements,” acknowledged APPEA’s chief executive Andrew McConville.

A CSG well in the middle of a wheat paddock near Dalby in August 2019.

Farmers alarm the indemnity clause used to be only effective while gas firms had been operational.(

ABC Southern Queensland: Nathan Morris

)

Future likelihood from CSG serene uncertain

Zena Ronnfeldt, who farms west of Dalby in southern Queensland, acknowledged the indemnity clause used to be only effective while gas firms had been operational.

“It certainly does not gain anything to resolve the liability disaster we’re now all facing when gas process ends,” Ms Ronnfeldt acknowledged.

Ms Ronnfeldt lately proposed a national levy to originate positive ample long-time period protection for farmers.

Zena and Gary Ronnfeldt stand along a fence on the property boundary with a gas well in the background, Dalby, Queensland 2020.

Zena and Gary Ronnfeldt have refused to permit gas pattern on their farm, but all spherical them there are gas wells and pipelines.(

ABC Southern Queensland: Nathan Morris

)

GFCQ acknowledged the concerns and acknowledged it continued to work towards a solution on long-time period likelihood after gas pattern ends.

APPEA acknowledged there had been hundreds of existing regulatory options to address future likelihood.

“We’re working with height farming bodies, insurers, and the Queensland executive to account for arrangements post-gas pattern,” APPEA’s Mr McConville acknowledged.

Dalby-basically based totally landholder lawyer and special counsel for Shine Lawyers, Peter Shannon, used to be more scathing of the announcement of the fresh indemnity.

“We don’t know which firms have agreed to what quilt.

“We don’t know the situations in which this indemnity clause being proposed will seemingly be agreed to.”

APPEA acknowledged the clause has the reinforce of the Insurance Council of Australia on behalf of the broader industry.

“The clause is being extinct by some APPEA participants for model spanking fresh land procure genuine of entry to agreements,” Mr McConville acknowledged.

“The clause would possibly perchance additionally merely additionally be applied to existing agreements if required by the insurer and agreed to by the landholder and proponent.”

Mr Shannon acknowledged landholders had “one hand behind their wait on”, obliged to originate industrial agreements with gas firms who owned the rights to the resource beneath their land.

The only recourse for farmers is to steal a complaint to the Land Court docket at their hang rate.

‘In 20 years we would possibly perchance additionally merely not have quilt’

Mr Shannon also acknowledged gas firms had been structured to protect their mum or dad firms.

A coal seam gas well and all of the piping and water extraction infrastructure.

There are over 6,800 coal seam gas wells across the Surat Basin in southern Queensland.(

ABC Southern Queensland: Nathan Morris

)

In explain to degree the playing field for farmers, Mr Shannon acknowledged there principal to be a industrial incentive.

“You’ve gotten to have the same industrial interest in finish as the diverse birthday celebration to procure mutually priceless outcomes,” he acknowledged.

“If we’re not being 100 per cent indemnified then we desire to have money to give us an incentive to steal the danger with that.

“The likelihood [is] that in 20 years we would possibly perchance additionally merely not have quilt.”

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CSG insurance clause ‘tall on spin, light on factor’, lawyer says, in its bid to protect farmers