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Information on AGL's approach to landholder agreements for CSG

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AGL Energy
02 April 2015

The Productivity Commission’s research paper Examining Barriers to More Efficient Gas Markets finds that there are opportunities to simplify and improve legislated landholder compensation arrangements, to reflect the costs to landholders from negotiating these agreements and the impacts on property values from hosting activities and infrastructure. Importantly, AGL’s approach to land access and landholder compensation negotiations already follow recommendations made by the Productivity Commission.

We understand that it takes time for landholders to review and understand land access agreements, and that expert advice might be required. This is why AGL’s Principles of Landholder Access include a commitment to pay landholders compensation for the time taken to negotiate with us, and for the reasonable cost of independent legal advice.

In 2014 AGL signed on to the Agreed Principles of Land Access with Santos, NSW Farmers Association, Cotton Australia and NSW Irrigators Council, reconfirming that we will respect the wishes of landholders regarding any exploration and production operations that take place on their land, meaning that landholders are free to say “yes” or “no”. We are therefore confident that landholders will only sign access agreements with us where they are mutually beneficial. We strongly believe that our activities represent positive value for AGL, our landholders and the broader community. In NSW, we have signed over 200 access agreements and have never accessed a person’s land without their permission or exercised arbitration rights available under law.

When landholders host our infrastructure, like gas wells, gathering pipelines or access roads, the small amounts of land we occupy is no longer available for farming and other applications. During the construction phase, disturbance can also occur, such as increased traffic, noise and dust. When we negotiate with landholders, we compensate for the land we occupy, as well as additional payments for this initial disturbance and inconvenience, to make sure they receive fair and equitable compensation. When we negotiate with landholders for our other development projects, such as wind and solar, we use similar principles to pay compensation, including to recognise disruption during construction works, and ongoing annual payments for hosting infrastructure.

Beyond these amenity and land use considerations, for which we already compensate landholders, AGL does not consider that there is any decline in land value associated with our coal seam gas, or other energy projects. This is confirmed by a report released by the NSW Valuer General in 2014 which found no evidence of an impact on NSW land values as a result of CSG activities.

We are committed to conducting our operations in a responsible way that minimises our impacts on landholders, their operations and the environment. If AGL or its contractors cause any loss or damage to land, gardens, improvements or stock from its activities, we will make good any damage. At the end of the activity, we remove our equipment and rehabilitate the land back to the same or better standard as when we arrived.

This article also appears on YourSayAGL.