The $1 million fine handed to gas company Arrow Energy for breaching Queensland's land access laws is "pathetic", an affected farmer says.
The fine is the result of a Department of Resources investigation into breaches of Queensland's land access framework by Arrow from 2018 until early 2022.
Farmers put pressure on the state government to address allegations that Arrow, owned by Shell and PetroChina, illegally drilled deviated wells beneath farmers' land on the Western Downs without the farmers' knowledge and without prior access agreements.
In November 2021, Arrow confirmed to The Project it had dug 48 wells under 13 farms without telling the landowners.
That equates to a fine of $20,833 per well.
Dalby area farmer Zena Ronnfeldt said the fine was "pathetic" after she complained to state and federal authorities about seven CSG wells on their boundary and five CSG wells on their property which were unlawfully drilled by Arrow Energy.
She said the fine would not act as a significant deterrent to a company like Arrow, which, according to analytics firm Dun & Bradstreet, generated US$195.51m in revenue last financial year.
"To fine them such a pathetically small amount of money is quite insulting to all the farmers that had their properties trespassed upon and secretly drilled into," Mrs Ronnfeldt said.
"It doesn't send a very strong message to any of these gas companies. They can effectively drill a well under someone's property and pay a fine of less than $21,000."
Mrs Ronnfeldt said the drilling had created subsidence (sinking) in parts of their property which impacted water drainage, so when crops became waterlogged, they no longer thrived, became diseased, or died.
She said yield reductions eroded profitability to the point there was a real risk that highly productive irrigated cropping lands would be permanently downgraded to livestock grazing use, which would have an enormous long-term impact to the Australian economy and food security.
In a statement, Resources Minister Scott Stewart said the significance of the penalty took into account Arrow's indiscretions.
"As a government, we make no apologies for holding businesses to account if they do the wrong thing," Mr Stewart said.
"Arrow Energy has acknowledged it has made mistakes in the past and in more recent times the company has taken tangible steps towards fostering genuine coexistence with landholders impacted by their operations.
"A line will now be drawn under this historical behaviour for industry and the focus from now on is ensuring that this doesn't happen again."
Upon further questioning, a Resources Department spokesperson said the investigation was "thorough", the fine was the largest of its type ever, and a compliance campaign was being launched.
"The department's investigation was detailed and thorough and this fine is the largest penalty the department has given to a resources operator," they said in a statement.
"A six-month targeted campaign starts this month checking on gas operations across the Surat Basin to ensure all operators, including Arrow's, are meeting their obligations for current drilling activities."
In a statement, an Arrow Energy spokesperson said the company accepted the outcome.
"Arrow Energy accepts the Department of Resources' decision and penalty," the spokesperson said.
"We recognise we made mistakes in the earlier implementation of the deviated wells model [and] we have acknowledged this publicly and made substantial improvements to our operations.
"We remain deeply committed to continually improving the way we engage with all landholders."
In 2011, Arrow was fined $40,000 for entering a property near Dalby without the owner's permission.
Arrow boss at the time, Andrew Faulkner, told the ABC the breach was unacceptable and should not happen to any landholder.
"It represents a legacy issue - events occurred between three and 18 months ago - clearly such breaches are not acceptable," he said.
"I just hope it all shows the government and the companies that what's happened in our situation should not happen on any landholder and they learn from it and they improve how they come and talk to landowners."
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Brandon Long
Brandon Long is a Queensland Country Life journalist based in Toowoomba.
Brandon Long is a Queensland Country Life journalist based in Toowoomba.
