Farmers frustrated following bidding war over water

Published: February 28, 2019

Mining companies have outbid farmers from the Namoi Valley at an auction for Zone 4 groundwater, further disadvantaging landholders during a time of extreme drought.

Whitehaven Coal paid around three times market value for a temporary transfer of water, over $900 per megalitre, pushed up by other miners in the region.

“There is no way farmers can pay over $900/megaliter for groundwater, we question the financial viability of our crops when it gets to around $350.  We’re being totally out-bid in the water market by mining giants,” Dave Watt, a local mixed cropping farmer from Gunnedah in the north west said.

“Mining companies frequently say that they can coexist with agriculture, but outbidding farmers to pay three times the price for water during a drought, has a huge impact on our agricultural businesses.  I can’t afford to grow my crops with water that costs $900/ML."

The extremely dry conditions are leading to mining companies desperately attempting to keep operating at full capacity. 

Conditions of consent state that mining operations must match their water availability, so companies are buying up the majority of available water so they can keep operating at full capacity rather than reducing production due to limited water. 

“Part of the mines’ conditions of approval are that they must change their operations based on the amount of water they have, just like farmers change their operations during dry times,”  Dave said.

Dave and his wife Janet and other farmers in the area are anxiously awaiting the next step in the government approval process of the Vickery Coal mine. The application for this mine includes predictions that it is predicted to operate at 10mtpa, will require no new water licences beyond those already held by the proponent, Whitehaven Coal.

Dave said, “Whitehaven is already short of water at Maules Ck, but at the same time they are saying they don’t need any more licences to open up the new Vickery coal mine. It just doesn’t make any sense. It must mean their models don’t account for these kinds of dry times.”

The Independent Planning Commission expects to hand down its summary of the issues of Vickery Coal mine by March 28th. Meanwhile coal companies will continue to outbid farmers to get hold of desperately needed water and regional communities will bear the brunt of that injustice.

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Content on this site is authorised by Georgina Woods for Lock the Gate Alliance, Lismore NSW.