New CSIRO Research – Farmers Lose Millions in Economic Returns due to CSG Mining

Published: December 16, 2016

New CSIRO research published this month which reveals that farmers lose millions in economic returns due to the direct impacts of CSG mining is staggering and has far-reaching implications, according to Lock the Gate Alliance.

The new spatial modelling, using a methodology developed by CSIRO after years of research, found that the direction alienation of productive farmland for CSG infrastructure in Queensland results in losses in gross economic returns of up to 10.9%.

The research, published in the Land Use Policy Journal, found that in relation to the chosen study area in the Western Downs:

“In the scenario assessment the total losses to gross revenues incurred by the existence of CSG infrastructure varied between $1.32 m and $3.29 m and averaged $2.17 m (Table 6)….Access tracks and lease areas contribute most to economic losses”.

The methodology was estimating economic losses based solely on reduction in land area and did not attempt to quantify losses resulting from disruption to operations, dust generation, erosion, spills and leaks of wastewater or the spread of weeds.

Therefore, total losses will undoubtedly be far higher.

“This new CSIRO research confirms the negative economic impacts that farmers have been talking about ever since they’ve been forced to live with industrial gasfields” said Phil Laird, National Coordinator with Lock the Gate Alliance.

“The research attempted to map, for the first time, the massive industrialisation of the landscape for CSG, including access tracks, pipelines, gas well pads, compression stations and other infrastructure, and assess the direct economic impact of that.

“The results revealed a loss in gross economic returns from CSG of up to 10.9%, which is just a staggering and unacceptable impact on an agricultural business. Very few farms operate with 10.9% margins and the impacts could mean the difference between survival and financial collapse.

“There is no way farmers can be expected to internalise those kinds of costs and keep operating effectively.

“The research shows that farmers are copping huge losses from CSG and that the Queensland Government has basically allowed the economic costs of CSG to be shifted onto the agricultural sector.

“The report gives an insight into why so many farmers are baulking at tiny offers of compensation from CSG miners that do not go anywhere near covering the costs of lost production.

“The true cost to farmers will actually be far greater than the 10.9% estimated here, because the research did not even attempt to quantify many of the other impacts including disruption to operations, erosion, spills and leaks of wastewater or the spread of weeds” he said.

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