The mining industry is on a collision course with Australia’s farmers over the emotive issue of the allocation of water resources.
The Minerals Council of Australia has warned that the industry is being overlooked in the planning for water sharing as the national water initiative has fixated on rescuing the ailing Murray-Darling Basin from over-allocation of water to farmers.
The group has lashed the slow pace of water reform, declaring the establishment of markets for trading water — a centrepiece of national reform — has made “only minor inroads” into the regional and remote areas where the industry operates.
Instead, both within and outside the Murray-Darling Basin, priority has been given to agriculture, it says.
But National Farmers Federation chief executive Ben Fargher hit back at the suggestion: “We make no apology in being centrally engaged and very active from the agricultural sector — water is our largest asset.”
Since the release of a draft plan for the Murray-Darling Basin in October, Mr Fargher has been vocal about the potentially devastating effects basin-wide cuts to water allocations of between 27 per cent to 37 per cent would have on farmers.
The Minerals Council — whose members include BHP Billiton, Rio Tinto and Xstrata Coal — says water should flow to industries such as mining that put it to the most profitable uses.
It has raised its concerns in a submission to the National Water Commission, which is conducting a landmark review of the national water initiative signed by then prime minister John Howard and the state premiers in 2004.
While the focus of the 2004 deal was on saving the Murray and other ailing river systems, it also opened the way for water trading to ensure more profitable use was made of water.
But the mining industry is critical of how the deal is being implemented: “For the NWI to become an effective, nationally applied mechanism for water reform and to have relevance to all water users, the requirement remains for government to consider water reform to areas outside of the Murray-Darling Basin and more broadly than for the agriculture sector.”
Nationally, the sector uses less than 3 per cent of the country’s water consumption. But in some regions — particularly outside the Murray-Darling Basin — it is responsible for up to 73 per cent of water consumed.
At Newcrest Mining’s Cadia East copper gold mine in the NSW central-west town of Orange, the state government has imposed strict planning conditions related to water usage on a $2 billion mine expansion. As well as ensuring advance warning of any water impacts, the mine has to provide compensatory water supplies to landowners whose ground or surface water supplies are affected.
Arguing that water availability is crucial to industry, the Minerals Council is demanding greater recognition in the planning for water sharing, fast-tracking of the establishment of a national water trading market and clarity about the application of special provisions for the minerals industry.
Yesterday, Minerals Council chief executive Mitch Hooke said the submission was “not about a contest with agriculture” but was a “reminder that there is more than just one high-value industrial activity that should be considered in the water reform process”.
“Our argument is with the regulator and the reform process, which seems preoccupied with agriculture — as important as that industry is,” Mr Hooke said, adding that he wanted agriculture and mining to co-exist.
Mr Fargher said the interaction between the agricultural, environmental and mining sectors over water policy was becoming increasingly “strategic”.
