Rural Landholder Insights

Rural landholders have shared their first hand experiences, lessons learnt and insights engaging with Queensland's onshore gas industry over recent years. The GasFields Commission has shared these stories with the aim of helping to inform and assist other landholders and improve understanding between the rural and onshore gas industries in Queensland.

Graziers say don't be pushed and take your time

  • Gasfields Commission
  • 03 Nov 2015
  • Posted 4 years ago

Graziers say don't be pushed and take your time

Second generation graziers Tom Donohoe and his sister Cecilia operate their cattle breeding business across three properties in the Wandoan district in the Surat Basin.

Over recent years they have experienced the construction of gas wells, pipelines and power lines on their properties - all at the same time.

This is the second in a series of articles where landholders have shared their experiences and lessons learnt to help inform and assist other landholders and seek to continue to improve understanding between the rural and onshore gas industries in Queensland.

Their first contact with the coal seam gas (CSG) industry came in 2002 with the drilling of an initial exploration well on one of their properties. Though it wasn't until late 2007, with the CSG industry starting to take off in the region that life began to change for the Donohoe's and they negotiated their first conduct and compensation agreement (CCA) for eight gas wells.

"At the beginning we (landholders) were new chums, so were the resource companies and especially their land access officers," says Cecilia.

"They'd come out here and they had no decision making powers, they couldn't answer your questions - everyone was so new and went forward at such speed.

"There seemed to be this big rush or push to get things done - whether that was bad planning on their part (the gas company) or they thought they'd just walk in and bring a paper that all landholders would sign and in the early days some landholders did.

"It was difficult even to try and find lawyers who understood the gas industry in those early days - it was a learning curve for all of us," she says.

From gas wells to pipelines

From 2010, the Donohoes were not only dealing with gas wells, but were also facing negotiations in relation to 14 kilometres of a major gas pipeline easement across their three properties.

While the wells and pipeline were being developed by the same gas proponent, for the Donohoe's at times it felt like they were dealing with two different proponents as there were incidences when there appeared to be limited communication and coordination between the two related projects.

The pipeline project was further complicated on one of their properties with the upgrade of road alongside the pipeline easement and their boundary fence.

The road which led to a major new production and water treatment plant for the onshore gas industry was being upgraded by the local council and was yet another party they had to deal with.

Tom says it was poor planning to have the road being built at the same time as the pipeline.

"We originally offered the gas company and council more land if required to fit both the pipeline and road to avoid taking out our boundary fence.

"In the end they took out six kilometres of our boundary fence and it was down for nearly 18 months. We couldn't get the different parties to agree on putting up a temporary electric fence when there was a real safety issue with our cattle and all the traffic going up and down that road.

"In the end they put up an electric fence but we still had to closely monitor our cattle," he says.

The Donohoes did have some other wins along the way. The original survey of the pipeline route had cut through the middle of a local heritage site - an old shepherd's hut where there remained some bits of old broken pottery, axes, timber and old fireplace.

"Once we pointed it out to them (the gas company) and highlighted the significance of the site for the district's local history, they bent the easement around the site.

"It shows they can and will listen to you if you deal with them and point things out," Tom says.

Consider renegotiating your CCA

Adding to the challenge of these multiple projects were the delays. Tom says they were initially told the pipeline would take only 12 weeks to construct where in the end it took two years to complete.

While they had negotiated an initial sum based on the 12 week timeline, the Donohoes were able to negotiate a review of their original CCA as their lawyer had argued the delay in construction (to two years) represented a material change of circumstance.

Cecilia says they felt more knowledgeable and better armed to negotiate with the gas company the second time around and got substantially more.

She encouraged other landholders depending on their individual circumstances to consider talking to their lawyer about reviewing their relevant CCAs if appropriate.

While there was little or no rain during the construction phase, the Donohoe's are monitoring the rehabilitation of the pipeline easement.

She says the easement grassed up quite well initially after good rain in January but unfortunately they have not had the follow up rain needed to ensure a good ground cover. At this stage there are no major weed problems which the company continues to monitor on a regular basis.

Power line easement

In 2013, the Donohoe's were confronted with the additional challenge of negotiating the easement and construction of a major power line on the opposite side of their three properties, also stretching some 14 kilometres in length.

The power line was to supply the new water treatment plant and other gas industry infrastructure.

Cecilia says it took almost two years to negotiate with the power utility company from when they were first approached and were still negotiating while they were surveying and constructing the line.

"We have recently concluded those negotiations and are satisfied with the final outcome.

"They (the power utility) operate under a different Act (Land Acquisition Act) and the project is more or less mandated by government to happen and initially their attitude was that it's their right to come on - they just seemed to want to ride rough shot over you.

"It means you have to be even more aware of your rights than with the gas companies.

"We actually locked them out for about 9 weeks because they were using my tracks past my cattle camps, not their agreed right of way - it was an ignorant and arrogant attitude.

Since then things have improved and the construction is now completed.

However, the Donohoe's remain perplexed about the overall planning of these gas industry projects and why the power and pipeline routes weren't positioned along a common corridor instead of traversing both sides of their properties.

Don't be pushed and take your time

The Donohoe's principal advice to other landholders dealing with the onshore gas industry is "don't be pushed and take your time."

Cecilia says initially the gas company wanted everything signed by yesterday and were on this tight schedule and unfortunately landholders can get a bit overcome by this.

"You need to take your time and get expert advice from lawyers, accountants, valuers and others.

"You can't stop them but you are better off going with them to get more out of them and this requires good negotiation skills.

Tom says you need to remember you are dealing with (gas company) people who mostly do not understand a rural business or dealing with cattle.

"You need to have all your information at hand with property maps and business plans - only you know your property, know your business and know your country," he says.

In choosing a good lawyer, the Donohoes say that there now are more experienced lawyers on the ground and that you should talk to your neighbour or somebody who used them because there are some 'sharks' out there in the (legal) industry whose charges are exorbitant.

Cecilia says in some instances, the legal bills have been as much as the compo for the landholder and that's not on.

Despite the enormous challenge of dealing with multiple gas related infrastructure projects on their properties at the same time - gas wells, pipelines and powerlines - both Tom and Cecilia acknowledge that the gas companies have lifted their game tremendously since the early days.

They hope other landholders won't have to face the same burden and that by telling the story of their experiences they can help others avoid the same pitfalls.

As Cecilia reiterates - "don't be pushed and take your time."