Foster Community Assoc.

Can’t sell, can’t insure in a gasfield

May 13, 2014, Echonet Daily

A detailed report by the NSW Valuer General suggests that a mature coal seam gas (CSG) industry may reduce property values. And a northern rivers property owner says her insurance company has warned her policy would be cancelled if the CSG industry came onto her property.

Greens NSW spokesperson on mining Jeremy Buckingham expressed alarm at the report, commissioned the Valuer General in 2013 to investigate if the CSG industry is having a material impact on land values in NSW. Mr Buckingam also said the letter to Woodenbong landowner, Marilyn Scott, was evidence of a real risk that property values would be devastated by CSG. He said the Valuer General’s report found that as the industry is in its infancy in NSW, there is not enough data to make an accurate assessment of the impact of coal seam gas on property values in NSW specifically.

Mr Buckingham said it also found there was anecdotal evidence which indicates that in some parts of NSW ‘negative perceptions of CSG [have] led to a reduction in the number of potential purchasers and an increase in the time taken to sell properties’.  He said the report said there were studies in America which found that a net reduction in property values of up to 22 per cent had occurred on properties with a gas well located on them ‘Overseas experience clearly shows that a mature unconventional gas industry will have a negative impact on land valuation’, Mr Buckingham said. ‘Currently there is a perception issue which is affecting land prices, but in the future we can expect to see further reductions as the inevitable environmental damage and legacy of ageing infrastructure become apparent. ‘Coal seam gas production will see the disruption of other land use activities such as farming and tourism and this will contribute to further property price falls. ‘Landholders are starting to ask themselves if the short term cash per well offered by the industry is worth the long term write down in their asset values. ‘It is unacceptable that farmers and communities should be slugged with a reduction in their land values to support the profits of multinational gas companies.’

Woodenbong local Ms Scott told media her insurance company wrote to her recently to say that if CSG came onto her property she had to notify them within seven days ‘and my insurance policy will be cancelled’. The policy was taken out with one of Australia’s largest banks, the NAB, and underwritten by global insurer Allianz.

Lock the Tweed spokesperson Michael McNamara told Echonetdaily the growing evidence that CSG posed such a risk to property values came as no surprise but was a real worry to all northern rivers landowners. ‘This has happened in the USA and I have been waiting for it to raise its head here,’ Mr McNamara said.

Unable to sell

Meanwhile a man who bought a tree-change property just years before the industrialisation of the Tara region of south-east Queensland told local media this morning he is contemplating walking off the property he is unable to sell. ‘If I have to, I’ll just pack up and walk out,’ Tara landholder Ian Jenkins, told ABC north coast this morning. ‘My entire life’s investment is down the mine.’ He is visiting the region to get away from the gasfields surrounding his home, and to warn north-coast locals not to be lured into supporting the industry which he says is destroying his health. Mr Jenkins said since the establishment of the gasfields he has been suffering from an array of symptoms that are baffling doctors, including leg pains, which he says go away whenever he leaves the area around his home for more than a week. ‘If they put a thousand wells in here, you guys are gone, ‘ he said He added his property had been on the market for four years, during which time he had only had two people come to look at it. Mr Jenkins said even the gas companies haven’t offered to buy him out. ‘I dropped the price $100,000 two months ago – and still no interest. Nobody wants to live in the gas.’