The New South wales Government has announced ‘tough new measures’ to bolster the regulation of the coal seam gas industry in the State.

“The NSW Government has listened to community concerns about CSG – these new measures build on what are already the toughest controls in the country,” Mr O’Farrell said.

“We have declared country towns and suburbs across NSW ‘no go zones’ for CSG activities in NSW, and established the Environment Protection Authority as the cop on the beat to enforce environmental and health regulations.

“The NSW Government has listened and acted. Local Liberals & Nationals MPs have also made strong representations and brought community concerns to Ministers.”

Under the package endorsed by Cabinet:

  • The independent Environment Protection Authority (EPA) will be the lead regulator of environmental and health impacts of CSG activities in NSW with responsibility for compliance and enforcement;
  • All exploration, assessment and production titles and activities will be required to hold an Environment Protection Licence;
  • The Chief Scientist and Engineer will conduct an independent review of all CSG activities in NSW, including the potential impact on water catchments;
  • A two kilometre exclusion zone will be imposed around residential zones to prevent new CSG exploration, assessment and production activities (both surface and underground);
  • Exclusion zones will apply to identified Critical Industry Clusters - viticulture and  the equine industry; and
  • An Office of CSG Regulation will be established within the Department of Trade and Investment to enforce other regulations.

Mr O’Farrell said that the exclusions zones will apply to any CSG activity that has not yet been approved under the EP&A Act or Petroleum (Onshore) Act.

AGL Energy has come out swinging at the proposed policy, claiming that it will add to the ‘gas supply crisis’ that the state is facing as existing contracts roll off between 2014 and 2017.

The company has warned that the policy will compromise existing investments in NSW and will lead to ‘substantial upward pressure on gas and electricity prices in the state’.