Two state government departments were unable to fully verify if it was appropriate for multinational company Kerogen Investments to become the majority owner of a gas exploration licence.
Petroleum Exploration Licence 456, which covers a large tract of land in the Upper Hunter, is jointly held by Hunter Gas Pty Ltd and Santos.
Hunter Gas sold 85 per cent of its share in the licence to Hong Kong-based Kerogen Investments in 2016.
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Government access to information documents obtained by Lock the Gate reveal Department of Planning and Environment Protection Authority staff who assessed the purchase struggled to find detailed information about the company beyond what was on its website.
A briefing to former Resources Minister Don Harwin noted: "KI is a private foreign entity and so publicly available information about the company is limited."
When considering whether the company was a fit and proper person, Department of Planning staff said: "Due to the risk profile of the application and the adequacy of the information available, personal and company probity forms were not served to any of the relevant directors.
As such, the research undertaken on the applicant companies cannot be considered completely exhaustive..."
Similarly, research conducted by the NSW EPA failed to uncover relevant information about KI, with the authority stating, "There is no compliance history under the company name of Kerogen Investments No. 1 (HK) Limited.
Further searches of our licensing, case management and electronic document management systems do not show any records for Kerogen Investments."
The Department of Planning, Industry and Investment confirmed the licence expired on March 5 2018.
"The holders applied to renew the title prior to expiry, and while a determination is being made on that renewal application, the exploration licence remains current," a department spokeswoman said.
"Following the Independent Planning Commission's determination to approve the Narrabri Gas Project, the Department of Regional NSW will now recommence the assessment of these applications."
Farmers in the region believe the Narrabri project will become a trojan horse for companies seeking to reactivate 12 so-called "zombie gas" licences.
Mullaley farmer Margaret Fleck, said the decision to approve the transfer of majority ownership of PEL 456 was a concern.
"The people of NSW need to have faith that their government is at the very least properly scrutinising companies that want to engage in an industry as controversial and risk prone as coal seam gas," she said.
"Even if Kerogen does not have boots on the ground, it still became the majority owner of a PEL that covers a large swathe of the Upper Hunter.
"These zombie licences are now hovering like a bad smell over the north west, and preventing members of the public from making long term decisions at their properties due to the uncertainty that surrounds them.
"It is shameful that the NSW Government has allowed a company to obtain majority ownership of a zombie PEL without the basic checks and balances completed.
"What is the point of having 'fit and proper person' laws if they can be ignored if the department decides it's too hard to find the relevant information about a company?"
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- This story first appeared on The Newcastle Herald website.
Matthew Kelly
Matthew Kelly has worked as a journalist for more than 25 years. He has been working as a general reporter at the Newcastle Herald since 2018. In recent years he has reported on subjects including environment, energy, water security, manufacturing and higher education. He has previously covered issues including the health and environmental impacts of uncovered coal wagons in the Hunter Valley, the pollution of legacy of former industrial sites and freedom of information issues.
Matthew Kelly has worked as a journalist for more than 25 years. He has been working as a general reporter at the Newcastle Herald since 2018. In recent years he has reported on subjects including environment, energy, water security, manufacturing and higher education. He has previously covered issues including the health and environmental impacts of uncovered coal wagons in the Hunter Valley, the pollution of legacy of former industrial sites and freedom of information issues.
