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Senate Estimates: Rural and Regional Affairs and Transport Legislation Committee (ARTC)

Estimates & Committees
Lee Rhiannon 18 Nov 2013

Rural and Regional Affairs and Transport Legislation Committee
Meat & Livestock Australia

Senator RHIANNON: I wanted to return to the issue about the report that the ARTC had Katestone Environmental Pty Ltd prepare about Hunter air quality issues. The official version of the report came out on 30 May and an earlier report had come out on 24 May. It was interesting to read the two versions. In three instances the report was changed to provide the opposite conclusions by inserting the words 'not' or 'no'. Could you inform us what evidence was found in the six days between the draft report and the final report that led to those conclusions being reversed?

Mr Fullerton : No. As we have published and announced on our website, ARTC had no involvement in the preparation of that report. We arranged that report through Katestone as a requirement of our licensing arrangements with the EPA in New South Wales. Various draft reports were provided to the EPA from Katestone when various questions were raised. But ARTC did not assess those reports to that level of technical detail.

Senator RHIANNON: So draft reports were provided to you, the conclusions were reversed when you took out the words 'not' or 'no' or inserted the words 'not' or 'no', and you did not make any comment on that; you did not ask for an explanation?

Mr Fullerton : No, because we are not technical experts in that field. We relied upon Katestone as the technical experts we engaged to conduct those investigations and they provided those draft reports to the EPA, who provided a response. We are not technically able to make any comment on the technical nature of those reports.

Senator RHIANNON: So they are the technical experts, but when the technical experts change their position so enormously and it is within a space of six days— and that is what I ask a question, 'What changed in those six days?'—would you not ask questions to ensure that you are getting the technical expert advice that you had sought?

Mr Fullerton : Again, we are not able to comment. We allowed the proper process to occur between the technical experts and the EPA and I think it is important to remember that the ultimate outcome of that report was the EPA then brought in an independent person to assess that Katestone report and they are currently in the process of doing an independent review.

Senator RHIANNON: So when you receive these reports do you examine them and seek further information where there might be inconsistencies or changes? Do you do that or do you just say, 'They're the experts; we accept this report'?

Mr Fullerton : That is right. They are the experts. They provide those reports to the EPA, who are the experts, and between the two a number of dialogues go on as that draft report is prepared to a final report and that is exactly what happened in this circumstance. We make our position very clear. We would only engage environmental experts. We do not comment on those technical reports. We allowed the process to work between the EPA and Katestone in this particular matter.

Senator RHIANNON: If I understand correctly, you just said that the dialogue does occur. So could you share with us the nature of that dialogue and did you ask for an explanation so that you would understand more thoroughly the technical advice you are given considering there is this enormous contradiction? I will read it to remind you how considerable that contradiction is. The 24 May report states that 'loaded and unloaded coal trains were associated with a statistically significant elevation in particulate matter concentrations' and the report released on 30 May stated that 'loaded coal trains were not associated with a statistically significant difference'. So is it not your responsibility fundamentally to understand, as they are the technical experts but they have changed their advice, why that has been changed?

Mr Fullerton : Not at all. We are very clear that we are not technical experts. We conducted these reports at the request of the EPA under our licence and those reports were provided to the EPA prior to them being issued as a final report. We do not do any analysis ourselves of their conclusions.

Senator RHIANNON: You said you had dialogue with the. What does the dialogue entail if you do not ask those sorts of questions?

Mr Fullerton : We engaged Katestone under the terms of our licence to conduct these reports. Those draft reports were provided directly to the EPA prior to their release. We do not receive those reports and analyse them ourselves. We are not equipped to do that. We are not technical experts in the field. They are passed through to the EPA who have an opportunity to provide feedback prior to the issue of those reports.

Senator RHIANNON: So when you received the 24 May report did you or anybody else in your agency request that Katestone Environmental Pty Ltd change those conclusions?

Mr Fullerton : No.

Senator RHIANNON: The initial report had 3,206 loaded and unloaded trains recorded but the final version, the 30 May version, only had 2,025, a reduction of about one-third. Did you inquire about that reduction?

Mr Fullerton : No we did not because that went to the core of the work that was being prepared by Katestone which was provided to the EPA. Again, we are not technical experts. We could not assess this from a technical point of view or from a statistical point of view.

Senator RHIANNON: What do you do to ensure that the companies you have hired to undertake this work will give you a reliable report which you can be confident is accurate considering we now have two reports which show that they have changed in a short period with no explanation, that they have changed fundamental conclusions and data?

Mr Fullerton : I think that, as I said a bit earlier, we are required under our licence to conduct these studies. This was the second of that series of studies that we conducted during the dry months of last year, last summer. We go out to the market to select experts in the field. These people are well regarded. They perform work for a range of people. We engaged them and those reports were provided to the EPA. As you would be aware, since that time there has been some independent work being done by a statistician to look at how that analysis was conducted, and we are still waiting for that outcome to be completed.

Senator RHIANNON: Were you just referring to the statistical expert that the New South Wales government—

Mr Fullerton : That is right.

Senator RHIANNON: And that data will be shared with you?

Mr Fullerton : That is a matter for the EPA, but I would expect it would be. They are conducting the independent review with Professor Louise Ryan, and she has been engaged to do a complete review of the analysis that was conducted by Katestone.

Senator RHIANNON: Right. Do you request that that should happen?

Mr Fullerton : No, we do not.

Senator RHIANNON: Do you have any feedback into it?

Mr Fullerton : That was something that was requested by the EPA—to get that Katestone report peer reviewed—and they initiated that in May of this year.

Senator RHIANNON: And the EPA informed you that they were doing that?

Mr Fullerton : Yes.

Senator RHIANNON: Okay.

Mr Mrdak : Chair, can I just add to an answer you asked earlier about the ownership of Hobart Airport.


Mr Mrdak : Fifty-one per cent is held by Macquarie Global Infrastructure Funds and 49 per cent is held by the Tasmanian State Government Super Scheme.

CHAIR: Righto. There you go. That sounds pretty fair—dear old Macquarie.

Senator RHIANNON: Actually, I did have another question—

CHAIR: No, it is too late; we are shut.

Senator RHIANNON: You are always a fair chair.

CHAIR: Quick.

Senator RHIANNON: Thank you. Mr Fullerton, we spoke before about China Shenhua. Have there been any payments to your department in terms of their involvement in the Hunter or in other areas?

Mr Fullerton : No.

Senator RHIANNON: So they are not required to do that in terms of any aspects of their work that they undertake with you?

Mr Fullerton : No, they are still in their planning phase for their operation in the Hunter Valley.

Senator RHIANNON: And where is that planning phase up to?

Mr Fullerton : It is their planning phase on their timing for their mine operations.

Senator RHIANNON: But I thought you had regular meetings with them, so you could—

Mr Fullerton : We do. As we do with all our producers, we have regular meetings on the status of their mining developments and the status of current developments to ensure that we can build into our plans the capacity to meet their requirements.

Senator RHIANNON: So that is why I was asking where it was up to. Where do you understand China Shenhua's planning is up to?

Mr Fullerton : They are still planning to develop their watermark operation north of Werris Creek.

Senator RHIANNON: And are they still pursuing the private construction to the north-west of the Port Waratah Coal Services Carrington coal loader?

Mr Fullerton : I cannot really comment on what their plans are. I think you would need to ask Shenhua.

Senator RHIANNON: Can you not comment because you say it is commercial-in-confidence—

Mr Fullerton : No, I do not know.

Senator RHIANNON: or because you are not aware?

Mr Fullerton : I am not aware, no.

Senator RHIANNON: Thank you, Mr Chair.

CHAIR: There you go. I will bet you one thing: they will not be paying much tax. We will be back at two o'clock. 

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