State Government calls for ‘urgent action’ to resolve disputes between farmers and Arrow Energy on the Darling Downs

Continued disputes between South East Queensland property owners and coal seam gas giant Arrow Energy have prompted an unusual intervention by the State Government.

Arrow Energy's long-planned Surat Gas Project was given the go-ahead by the Queensland Government three years ago.

Ongoing coexistence disputes between South East Queensland property owners and coal seam gas giant Arrow Energy have prompted an unusual intervention by an arm of the State Government. 

The GasFields Commission Queensland this week called on all stakeholders to “urgently act’’ to resolve their differences over the $10 billion Surat Gas Project, near Dalby on the western Darling Downs. 

Farmers and graziers in the region have repeatedly raised the alarm over what they fear are drilling impacts on groundwater and whether the activities meet statutory requirements.

“The allegations and complaints levelled against Arrow are being driven by a common desire held by regional communities to understand what a resource company’s regulatory obligations are, and if they are complying with these requirements,” GasFields CEO Warwick Squire said.

“That is why we are now calling on the Government to finalise their investigations into compliance issues as a matter of urgency.

“This will provide much-needed community assurance that the state’s regulatory framework requirements are being enforced”.

Mr Squire pointedly called on Arrow to do more to improve its relations with regional communities and landholders.

Arrow Energy's long-planned Surat Gas Project was given the go-ahead by the Queensland Government three years ago.

An Arrow spokesman acknowledged on Wednesday that the company had made mistakes in the past, but said it “remains fully committed to meeting all regulatory requirements’’.

“Arrow appreciates that our Surat activities are taking place on some of the state’s most productive black soil, and that we must take exceptional care to minimise our impacts on landholders, communities and the environment to deliver our project,’’ he said.

“We have previously acknowledged that we made mistakes in the early implementation of the multi-well pad and deviated wells model and that we need to do better.

“Rebuilding relationships of trust takes time, and Arrow is committed to that process, which means we will continue to engage transparently with both landholders and regulators.”

The Surat Gas Project, which is a 50/50 joint venture between Shell and PetroChina, was approved three years ago by Premier Annastacia Palaszczuk

It is one of the state’s biggest resources undertakings of the past decade, covering about 2500sq km between Dalby and Chinchilla.

The aim is to bring an extra 5000 petajoules of gas to the market over the next 27 years, but disputes with agricultural landholders have slowed down the pace of development.

The intervention of the GasFields Commission, an independent statutory body created in 2013, is just the latest setback to hit Shell and PetroChina.

The two energy giants suffered a $1.2 billion writedown on their Australian operations last year as gas prices fell largely because of pressures brought on by the Covid-19 pandemic.

The partnership has incurred almost $9 billion in losses since it was formed in 2010.

Arrow reported a $606 million net loss in the 2020 financial year and $866 million of red ink in 2019.

The headwinds are consistent across the sector, with the nation’s LNG and gas sector writing down more than $25 billion over the past decade.

Originally published as State Government calls for ‘urgent action’ to resolve disputes between farmers and Arrow Energy on the Darling Downs