Open letter to Doug Jackson and Andy Vesey

Open letter to Doug Jackson and Andy Vesey

October 27, 2016

AGL executives were greeted by a community protest outside its AGM on September 28 in Sydney calling for it to shut down its gas fields.

Residents from Camden, in south west Sydney, had come to tell the company that it must leave now, not in 2023.

Inside, several shareholders asked about AGL’s plans and why it had consistently refused to acknowledge the community’s concerns about the impact of wells being so close to homes and schools. They also wanted answers to questions such as AGL’s illegal method of disposing of waste from the mines and fugitive emissions from well heads.

Several weeks later, Doug Jackson, AGL Executive General Manager, Group Operations at AGL Energy responded in a letter, dated October 20, to one of the shareholder activists.

Below, Australian Mothers Against Gas Melinda Wilson takes apart his and CEO Andy Vesey’s claims at the AGM. At the end she asks AGL for answers to 6 questions.

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Dear Doug Jackson,

At AGL’s AGM Andy Vesey and yourself told shareholders that the Camden community would be provided with a decommissioning schedule very shortly after the AGM.

Your recent email (October 20, 2016) stated that decommissioning details would be available at AGL’s Community Consultation Committee (CCC) in March 2017.

Considering the adverse health impacts of the gasfields, it is not acceptable to have to wait another 6 months.

Further, I draw your attention to the requirements of the CCC which state:
“Membership of the committee shall comprise: an independent chairperson”; “The committee should meet at

least twice per year”; and, “minutes need to be publicly available within 28 days of each meeting”. AGL is in breach of these.

Margaret McDonald-Hill, named as the chair of Camden’s CCC, is not independent. She is paid by AGL, via the Department of Trade and Investment.

This is a direct breach of the CCC requirements.
The CCC is required to meet twice per year, and yet the last recorded minutes were November 2015. This is another breach.
They are in breach as they have not met at all in 12 months.
The next CCC meeting is planned for March 2017. This is a another direct breach.
CEO Andy Vessey told the AGM: “There are no leaking wells in AGL’s Camden Gas Project.”

This is false, and was a deliberate intent to deceive shareholders and the public.

AGL’s own Annual Leak Detection and Repair reports shows that every year the number of leaks detected at the Camden Gas Project increases.

I draw to your attention to the AGL report, dated September 23 to October 3, 2014, that proves 28 leaks were identified — 11 of them minor, 13 as major and 4 as significant.
I draw to your attention AGL report, dated December 22, 2014 to December 11, 2015 that documents 40 gas leaks in three months. Of the leaks, 26 were reported as minor, 11 as major and three as significant.

In your email you stated:

1. “The Camden Gas Project has operated safely and will continue to do so. This has also been confirmed in a new fact sheet recently released by the NSW Department of Health.”

How NSW Health was able to arrive at this conclusion without interviewing anyone living in the Camden area reporting health problems including headache, rashes, sore eyes, nausea, nosebleeds, hair loss, respiratory distress is, frankly, unbelievable.

2. AGL states: “Methane is a low toxicity gas which has no impacts on human health at concentrations that commonly occur in the air around us.”

A gas field emits methane, and not at the commonly occurring levels. Methane levels near coal seam gas fields in Australia have been found to be as much as triple normal, or average, levels.

Maher, D.T., Santos, I.R. & Tait, D.R. Water Air Soil Pollution (2014) 225: 2216. doi:10.1007/s11270-014-2216-2 These findings have now been published in the Water, Air and Soil Pollution journal.

A new report written by people who support the unconventional gas industry, A review of current and future methane emissions from Australian unconventional oil and gas production, dated October 2016, states: “The act of burning methane (e.g. by using a flare, furnace, gas engine or other device), can produce pollutants such as formaldehyde which is a known respiratory health hazard.”

This contradicts AGL’s claim that “Methane has no impact on human health”.

The Melbourne University report notes that Australia’s unconventional gas producers are not monitoring fugitive emissions, largely because they do use the technology required to do so, preferring to instead rely on guesswork.

3. AGL states: “The information available suggests that neither the main gas extracted (methane), nor the most hazardous BTEX compound Benzene, could pose a risk even to the health of residents living very close to gas well heads in the Camden Gas Project area.”

However, the peer-reviewed study “Advances in Understanding Benzene Health Effects and Susceptibility” states:

“Benzene is a ubiquitous chemical in our environment that causes acute leukemia and probably other hematological cancers.

“Evidence for an association with childhood leukemia is growing.

“Benzene affects the blood-forming system at low levels of occupational exposure, and there is no evidence of a threshold.

“There is probably no safe level of exposure to benzene …”

4. AGL states: “Contamination of ground or surface water is unlikely due to the low volumes of produced water associated with the coal seams and the location of groundwater.”

There has already been a problem at the Camden Gas Project arising from a suspected vertical connection between coal seam gas-produced water and shallow groundwater.

The 2011-2012 “Water Quality Investigation Camden Gas Project” report by AGL stated “low salinity, ‘atypical’ produced water was detected.

“Aquifer connectivity was not conclusively ruled out due to a similar chemistry between coal seam produced water and shallow groundwater, and the presence of tritium (a radioactive isotope of hydrogen) in coal seam produced water would suggest there may be a vertical connection that would require further testing.”

5. AGL states: “AGL’s own commitment to safety should provide a high level of reassurance to the community.”

To date, AGL’s safety record has been anything but reassuring.

Here is a timeline of the problems:

In June 2016, the community reported that AGL’s CSG wells were flooded by the Nepean River and underwater. CSG waste water tanks were observed floating and emptying into the river. Locals observed the Nepean River bubbling around the flooded wells. It is still not known how much fluid entered the river or what it contained.

In January 2015, after a freedom of information request, it was discovered that CSG wells had been horizontally drilled under homes in Spring Farm, without the knowledge of home owners.

In November 2015, AGL’s CSG Leak Detection Report stated 19 out of 90 wells were leaking at the Camden Gas Project.

In November 2014, AGL’s Coal Seam Gas Leak Detection Report stated 11 out of 95 wells were leaking at the Camden Gas Project.

In August 2014, Spring Farm well 5 leaked gas for hours without any immediate response from AGL. Residents had to call emergency services. AGL had previously promised to shut down the gas supply in the event of an accidental gas release as part of its Safety Management System. Nothing like this happened on August 31, 2014. AGL was fined $15,000 by the Environmental Protection Agency for breaching its pollution license.

  • In November 2013, AGL’s Coal Seam Gas Leak Detection Report stated 9 out of 95 wells were leaking at its Camden Gas Project.
  • In September 2013, Spring Farm well 5 required repairs due to pieces of polyliner blocking the well.
  • In June 2013 and December 2012, Spring Farm well 5 required the removal of 104 metres of poly pipeblocking the well.
  • In January 2013, locals reported that one of the wells, located closest to the flooded Nepean River, had flooded and gas bubbles could be seen. There was concern that chemicals may have leached into the river. This event raised questions about the ability of the CSG industry to monitor itself.
  • In September 2012, AGL drilled coal seam gas well MP25 in Menangle Park, just 40 metres from the Nepean River without any community consultation. Residents received a notice in their mailboxes the previous night. Campbelltown City Council objected to the well, based on the site’s location within the Nepean River’s flood zone. But, it went ahead.
  • In May 2011, Greens MP Jeremy Buckingham visited AGL’s CSG wells near Camden. While filming a drill rig near Glen Alpine, it exploded, spewing thick white foam into the air that gradually became a liquid aerosol and drifted toward Glen Alpine. This was of huge concern, given the fact that the Upper Canal, that supplies up to 20% of Sydney’s drinking water, was just 100 metres from the well.
  • In November 2011, Spring Farm well 9 leaked up to 1000 litres of water. The leak was due to an incorrectly sized Blowout Preventer used in the pipe ram blocks for the well.
  • In October 2006, locals reported that cattle were refusing to drink from Menangle Creek. The closest Road to the creek is Medhurst Road, the access road to AGL’s Rosalind Park Gas Treatment Plant. Locals observed water bubbling up through a crack in a rock from the Menangle Creek bed just 50 metres from a CSG well. In November 2006, a Department of Environment Climate Change officer inspected Menangle Creek with AGL and the complainant. Water samples were collected and a report presented to Macoun Environmental and Department of Planning. They inspected AGL’s well sites (RP6, RP7 and RP11) adjacent to Menangle Creek. No water discharge was evident and DECC therefore proposed no further action be taken. The water analysis report was never released.AGL claims that Camden produces 5% of NSW gas supplies. If this is the case, it is definitely not critical to the NSW gas supply.

    Nevertheless, the dangers of this industry far outweigh any conceivable benefit. In a climate challenged world, Australia needs to move rapidly to sustainable energy, as AGL itself acknowledges.

    The Camden community wants all AGL coal seam gas wells decommissioned now. We do not accept AGL’s proposed leave date of 2023: we do not want to suffer another 7 years of health problems.

    Finally, I would appreciate responses to the following:

1. When will AGL comply with CCC requirements and appoint an independent chair?

  1. When will someone who is suffering health impacts from the Camden CSG project be allowed to join the CCC?
  2. Can you explain how the act of burning methane (e.g. by using a flare, furnace, gas engine or other device), is safe?A peer reviewed study, A review of current and future methane emissions from Australian unconventional oil and gas production, dated October 2016, stated that burning methane produces pollutants such as formaldehyde, a known respiratory health hazard.

    This gives reasonable cause to believe Spring Farm residents’ reports of respiratory distress. AGL’s 2011-2012 Water Quality Investigation Camden Gas Project report stated “low salinity, ‘atypical’ produced water was detected.“

    Aquifer connectivity was not conclusively ruled out due to a similar chemistry between coal seam produced water and shallow groundwater, and the presence of tritium (a radioactive isotope of hydrogen) in coal seam produced water would suggest there may be a vertical connection that would require further testing.”

  3. What did further testing find? And please provide the report by return email.In October 2006, locals reported that cattle were refusing to drink from Menangle Creek. The closest Road to the creek is Medhurst Road, the access road to AGL’s Rosalind Park Gas Treatment Plant.

    Locals observed water bubbling up through a crack in a rock from the Menangle Creek bed just 50 metres from a CSG well.

    In November 2006, a Department of Environment Climate Change officer inspected Menangle Creek with AGL and the complainant. Water samples were collected and a report presented to Macoun Environmental and Department of Planning. They inspected AGL’s well sites (RP6, RP7 and RP11) adjacent to Menangle Creek.

  4. What did the water analysis report find? Please provide a copy of the report via return email.In June 2016, AGL’s CSG wells were flooded by the Nepean River and underwater. CSG waste water tanks were observed floating and emptying into the river. Locals observed the Nepean River bubbling around the flooded wells.
  5. How much fluid entered the river and what was the composition of the waste water that emptied into the river?

Yours sincerely,

Melinda Wilson
Australian Mothers Against Gas