AGRICULTURE and mining are approaching a cross road in NSW, with growing land use conflict and climate change concerns sparking debate about government’s ability to balance food security with fossil fuel industries.
Farmers and the broader community are calling for the Commonwealth’s sovereign wealth fund to divest from fossil fuels.
Meanwhile, NSW Resources and Energy Minister Anthony Roberts lauds the sector’s long term prospects.
The circumstance of Liverpool Plains grassfed beef producers Derek and Kirrily Blomfield are a case in point.
The Blomfields run grassfed cattle at Caroona, and their property "Colorado" would be undermined by BHP Billiton’s controversial proposed Caroona underground longwall mine, despite an election promise from Premier Mike Baird.
The Blomfields, who were NSW Farmers of the Year in 2104, share a predicament with many producers facing nearby coal and gas development.
Mr Blomfield has added his voice to a petition from multinational climate group 350.org, with some 8,500 signatures, calling on the Commonwealth's $117 billion Future Fund to divest from fossil fuels.
“Investors have to realise they can’t wash their hands of responsibility. It’s robbing Peter to pay Paul when the Fund invests in (fossil fuel) companies,” he said.
Fossil fuel production threatened food security through development of gas and mining projects on agricultural land, and carbon emissions from fossil fuel consumption threatened significant impacts on agriculture from climate change, he said.
“We see BHP threatening food security here at Caroona. And farmers everywhere will be on the front line of climate change.
“We need to return carbon to the soil to improve resilience to climate change. It’s in our best interest to do what we can maintain a static climate.”
The Fund declined the Blomfields request for a meeting, but a spokesman told them in a phone conversation that it would not divest from fossil fuels.
In a statement, the Fund told The Land: “Our position is that simply excluding fossil fuels is not consistent with our investment strategy or pursuit of our objective.
“The Fund invests in line with a mandate from the Government and is required to target a return of at least inflation plus 4.5 per cent per annum over the long term.”
Future Fund chairman and former Treasurer Peter Costello took a strong line on fossil fuel earlier this month.
He said “unless parliament passes a law… we'll continue to invest in companies where there is an investment case, whether they are banks or fossil fuel companies or banks lending to fossil fuel companies.”
More recently, the man responsible for NSW’s mining and gas future told an industry gathering yesterday that despite the recent rise of renewables, gas and coal would continue to be essential to the state's energy needs, employment and revenue.
Minister Roberts highlighted to the Committee for Economic Development of Australia forum two measures that would promote fossil fuel industries.
He announced that NSW gas market reforms attempt to mirror the retail electricity deregulation, by July 2017.
But it was “unjustifiable” that NSW only sourced 5 per cent of the gas demanded by its 1.3 million consumers from within the state.
New gas production (which can only come from regional NSW due to exclusion zones for residential areas) was needed to increase the state’s energy security and put “downward pressure on prices”, he said.
The “tough measures” in the NSW Gas Plan would ensure sustainable development of CSG resources while agricultural and environmental assets are protected, Mr Roberts said.
NSW’s coal industry was key to the state’s future as “the backbone of the economy”, supplying 80 per cent of the state’s electricity and supporting 120,000 jobs.
He acknowledged coal was in a downward cyclical trend, but “time and time again” the industry had proved its resilience.
Government had paved the way for future production “with a transparent and accountable framework” after adopting the recommendations of the Independent Commission Against Corruption for coal exploration, he said.
“The coal Exploration Steering Group’s new approach includes identifying areas for release only after environmental, social and economic factors have been considered and the community has been consulted."