25 February 2010
Mr MORRIS (Mornington) — I think the last time we discussed geosequestration I preceded the member for Macedon, so it must be something about the subject.
The bill we are discussing this afternoon is a reasonably good attempt to combine one of the oldest activities of the industrial age — that is, the search for a reliable, consistent and relatively cheap energy source — and one of the newest challenges for the post‑industrial age, and that is how we deal with the by‑product of converting that material into energy and how we deal with the waste of that process. In this case the waste is carbon dioxide. Each of those things is an immensely complex issue. Each has an enormous downside if we get it wrong, and each also has great potential benefit if we get it right.
The complexity of the task in this instance is made somewhat greater because of the federal‑state demarcation issue, which was itself the subject of a landmark settlement over 30 years ago. The task is also simplified because, to a large extent, we are simply re‑enacting the Petroleum (Submerged Lands) Act 1982 with what the explanatory memorandum describes as a ‘modest number’ of policy changes. I will come back to that in a couple of minutes.
I note that the second paragraph of the explanatory memorandum indicates that:
The purpose of this bill is to provide a more user‑friendly enactment that will reduce compliance costs for the upstream petroleum industry and for the governments that are charged with administering it.
I do not know how anyone can claim, when they have taken a 360‑page Act and turned it into a 967‑page bill, that they are cutting red tape. That is a very long claim, and perhaps that is part of the core of the problem that we in opposition have with this bill.
The second part of the task is dealing with waste — the whole carbon capture and storage subject. While the protocols and practices for petroleum exploration and recovery and all the processes that go with that have been refined — no pun intended there — over a long period, the processes for carbon capture and storage are relatively new.
I do not intend to go into the specifics of the bill. Clearly, given the size of it, time would not permit me to do so. In terms of the petroleum aspects of the bill there are a couple of things that are worth commenting on. The first is the expanded definition of ‘petroleum’. Whereas the original legislation essentially referred to ‘naturally occurring hydrocarbons’, this piece of legislation contains a much expanded definition that refers to gas that may have been reintroduced into a petroleum pool and later recovered. So it is a product that could either be the original product, the original product with additives, the original product with fewer constituent parts or a mixture of all of the above. That is an important change to the legislation.
I also indicated earlier that I would come back to the section of the explanatory memorandum that refers to the ‘modest number’ of policy changes. The only reference to a policy change I could find in the bill related to the definition of the word ‘explore’. In the original legislation the word ‘explore’ was not defined at all; it was simply intended to be a dictionary definition.
Under this legislation there is a substantial expansion of the definition to include seismic surveying, seabed sampling and the various forms of exploration currently in practice, in large part to ensure that speculative survey companies are in fact included in the legislation and that the exploration work is linked to a title. That is an important part of the legislation as well.
Before I talk about the greenhouse gas storage aspects of the bill I think it is useful to reflect on the relatively narrow area of operation we are talking about. We are not talking about huge offshore areas. We are only talking about the 3‑nautical‑mile‑wide strip around the Victorian coast. That is the ‘land’, ‘submerged land’ or ‘sea’ — however you wish to describe it — that was the subject of the offshore constitutional settlement which was reached at the Premiers Conference in June 1979.
I was interested to read a document that was printed the following year by the Australian Government Publishing Service entitled Offshore Constitutional Settlement: a Milestone in Cooperative Federalism. I thought that was interesting because it is a term the Premier has sought to coopt and very much make his own, when it was in fact around in 1979. Of course it was the Hamer and Fraser governments of the day that made that co-operation a reality.
The settlement followed a High Court decision, which in turn was prompted by the passage of the Seas and Submerged Lands Act 1973. Essentially the outcome of the settlement ensured that legislation would be passed with the agreement of all state parliaments, and I understand it was the first time that section 51(xxxviii) of the Australian constitution was going to be used to, amongst other things, ensure that the territorial seas, the 3 miles breadth, would be placed under the control of the states, which of course was what everyone had thought was the case until the High Court decision.
Members might say why should the states continue to administer that 3‑mile zone plus the enclosed waters, like Port Phillip Bay and Western Port bay. While they may generate some problems, wherever you have boundaries and demarcations, you are going to have issues of overflow.
It is important that given the environmental sensitivities, particularly, of the intertidal zone, and the areas in proximity to the shore, and also the incredible connection that people have with that part of the environment, that the states retain control over the abutting areas of the coast. It is an area that could have significant impact on the environment. It could also have a significant impact on the amenity of the lifestyle of all Victorians. It is important we retain that authority.
Those greenhouse gas principles in parts 3, 5, 6 and 8 of the Bill have some history. The original legislation on greenhouse gas geological sequestration was debated in Churchill some 16 months ago. That act is in place for land‑based activities. In 16 months events have moved rapidly. But it remains important that we move towards a clean coal, particularly in terms of brown coal, environment.
It is critical for the future of jobs in the Latrobe Valley; it is critical for the future of our state’s energy; it is critical for the whole security and future of our economy. It is an abundant resource. By some accounts we may have an energy supply for half a millennium, which is a difficult concept to grasp. We simply cannot afford to squander that.
Yes, there are some issues. There is no doubt it is complicated. We need to be concerned with the issues regarding long‑term viability. The member for Doncaster and the member for Malvern have dealt with that issue. Yes, there are some challenges, particularly environmental challenges, along the way. But like the issues regarding the original bill, these issues are not insoluble.
I have no doubt that given the abilities and skills of our scientists, researchers and technicians, they are more than capable of sorting out any challenges. This is an important step forward in the clean energy debate. Despite some deficiencies, I am more than happy to not oppose the bill.
Legislative Assembly 25 February 2010
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