Mining magnate Gina Rinehart buys into Victorian coal and gas exploration

Local mining company Lakes Oil has long been trying – without success - to commercialise oil and gas operations in both Western Victoria and Gippsland.

“Today's announcement that Gina Rinehart’s company Hancock Prospecting has invested in Lakes Oil through a convertible notes issue must concern everyone who is worried about the prospect of an on-shore gas industry in the state” said Friends of the Earth campaigns co-ordinator Cam Walker.

“Lakes Oil chairman Robert Annells was reported as saying that the shares could be converted as early as May this year, which could lead to intensified drilling operations by winter.”

“Lakes is generally seen as being an old school oil and gas company. Despite never having produced any commercial quantities of gas, it has long believed it will be able to open up new oil and gas operations in the state. It is hardly surprising that well known climate sceptic Professor Ian Plimer has been appointed as a non-executive director of Lakes Oil as part of this deal”.

“This cements Lakes Oil reputation as being a 20th century company chasing fossil fuel production in some of our best agricultural land. It is hard to imagine such an industry will get social license to operate given the real risks that would come to farming and water supplies.”

Through its subsidiaries, Lakes is pursuing a range of unconventional oil and gas options in Victoria, including shale and tight gas, and coal in several very productive dairy regions on the Gippsland Plains. The company has recently been criticised for its management of a gas flare operation in Gippsland in 2010. Documents released under Freedom of Information to Friends of the Earth show that at least one fire has escaped a flaring site, burning about 10 hectares of land. The company operators were not able to put the fire out and it was only the intervention of the local CFA that stopped this turning into a major incident.”

“The entry of such a powerful player in the mining sector into local operations will drive community concerns about new coal, oil and gas operations. It is essential that the state government act, and assure the community that it will not approve any fossil fuel operations on farmland in Victoria.”

Further comment: Cam Walker 0419 338 047