After much anticipation (and dread) The Reith Report was handed into the state government this week. Peter Reith is an ex-Howard MP and was the head the Gas Market Taskforce, a group that was charged to look into the Victorian gas market and it’s viability. The taskforce contained such vested interests as the CEO of Origin Energy, the Chief Executive of the Australian Pipeline Industry Association, the Chief Executive of the Australian Petroleum Production & Exploration Association, the Executive Manager of Energy Australia, and many more. There was practially zero community consultation.
The government is yet to release the report, saying they will “hasten slowly” on looking into an unconventional gas industry in Victoria.
However Mr Reith came out roaring in the media, declaring to anyone who would listen that Victoria must lift its moratorium on fracking and open up the land for unconventional gas mining. He also declared that there had been no reported cases of water contamination in the USA (where they have had fracking for years), despite there being hundreds. In Pennsylvania USA alone, there has been 120 cases of water contamination in relation to fracking. In Queenland, gas leakage was found in the Condamine River, right near fracking sites.
Most sensationally, Mr Reith declared that gas prices in Victoria are going to skyrocket, and that we need unconventional gas production to keep domestic prices low. Industry groups are trying to spread the idea that this price rise is due to Australia facing a gas shortage, but even fossil fuel companies like BP Group deny that it is true.
In fact, the push to develop a fracking industry in Victoria is part of a plan to create a gas export industry. Companies would rip up the Victorian landscape to collect gas, which would then be shipped off to the Asian market for a tidy profit. We are not facing a gas shortage. About 80% of gas reserves in Australia are already set aside for exports. Even the most conservative estimates think Australia’s supply will last at least two decades.
In fact, it is actually the unconventional gas export industry that will cause Australian gas prices to rise massively, as you can see in this article.
Linking Australian gas to high prices in China will make it more profitable to sell domestic gas overseas than to leave it here. This means that when Australians turn on their stoves, they will have to pay through the nose just to keep the gas in the country.
Industry and politicians are both well aware that communities do not want unconventional gas fields in their back yards, hence their enthusiasm to create this myth of a looming shortage to scare people. However communities are all too aware that unconventional gas means destruction of their farms, health risks for their families, pollution of their waterways and aquifers, and poisoning of fragile ecosystems. Three communities have already declared their towns ‘Coal and Gas Field Free’ (link to page), and twenty-two more are well on their way, to say: no coal or unconventional gas!
The Reith Report encourages industry groups to do what community groups are calling bribery: offer farmers royalties to house gas wells on their land. However, the impacts of a gas well go beyond the edge of a property, and these decisions should not just be made by individuals. Unconventional gas affects the whole community, but Reith is encouraging companies to ignore the needs of many by paying off a few.
Creating an unconventional gas industry in this state will ruin the lives and livelihood of thousands of families across Victoria and the rest of Australia. The increased price of gas will hurt the back pocket of all Australians, and cripple the Australian manufacturing industry, which is the largest consumer of gas. And it will further encourage the reliance on fossil fuels, dumping massive amounts of greenhouse gasses to the atmosphere.
Instead, our state should be investing in a cheap, environmentally friendly energy industry based on renewable energy. We need to extend the moratorium in Victoria to protect communities not just from fracking, but also from all coal and unconventional gas projects. Instead of further enabling harmful fossil fuel expansion, the government needs to be dismantling the ridiculous laws currently crippling the renewable energy sector. In short, we should be planning for a future in which Victorians can live happily, healthily and cheaply.
The Reith Report clearly only serves the interests of the industries that stand to make a lot of money from unconventional gas mining, not all of the people who will have to bear the extensive consequences.