SA budget shows govt’s energy resolve

Treasurer Tom Koutsantonis has offered a five-year deferral on all royalties for new gas wells, provided they go into production within the next five years.

He also remains committed to building a new State Drill Core Reference Library at Tonsley to underpin the mineral and energy exploration sector.

But opposition to an unconventional gas industry on agricultural land is strong in SA, particularly in the South East where the Otway Basin lies.

Protests have been held, stakeholders – from farmers, environmentalists and residents – have banded together, and the Liberal Party has called for a Parliamentary inquiry into mining in the SE.

Also, the SE Local Government Association, which represents councils in Mount Gambier, Grant, Kingston, Naracoorte Lucindale, Robe, Tatiara and Wattle Range, has pushed for a moratorium on unconventional gas extraction.

It wants both shale and tight gas – two forms of methane that rely entirely on hydraulic fracturing to extract – to be included under the federal government's Environment Protection & Biodiversity Conservation Act. This would put it under the definition of mining activities where water resources are deemed to be of national environmental significance.

But during the recent budget launch, Mr Koutsantonis said he made no apologies for the push.

He wanted companies to see SA as a low -risk place to invest, with the hope it could become the centre of a new energy "revolution" which he said had transformed the United States during the past decade.

He criticised the Liberal Party, claiming it was undermining SA's international reputation as a safe destination for resource projects by asking for a parliamentary inquiry into mining in the SE.

"SA Liberals, such as federal Member for Barker Tony Pasin and newly elected Member for Mount Gambier Troy Bell are deliberately politicising an orchestrated scare campaign aimed at demonising an industry that delivers jobs and helps grow our economy," Mr Koutsantonis said.

He said Opposition Mineral Resources and Energy spokesperson Dan van Holst Pellekaan should scrap the plan for an inquiry, labelling it as "scaremongering".

"We are recognised for having the world's best regulatory regime and decisions are made on the basis of high environmental standards and public consultation," Mr Koutsantonis said.

van Holst Pellekaan said it was "crazy" for the Treasurer to say the Liberal Party was opposed to mining, oil or gas developments.

He said he wanted them to be safe for the people who worked on them, beneficial to nearby communities, and safe for the environment.

If existing laws and protection measures were sufficient, then the government had "nothing to fear" from an inquiry.

"Just because you're setting up an inquiry, it doesn't necessarily mean you're opposed to something," van Holst Pellekaan said. "It just means you think it requires further scrutiny."

* Full report in Stock Journal, July 3, 2014 issue.