Linc Energy fined $4.5 million for serious environmental harm at underground coal gasification plant

A gas company has been fined a record $4.5 million for causing serious environmental harm at its underground coal gasification plant on Queensland's western Darling Downs.

Linc Energy was found guilty by a District Court jury in Brisbane last month after a 10-week trial.

The company was charged with five counts of wilfully and unlawfully causing serious environmental harm between 2007 and 2013 at Hopeland near Chinchilla.

Linc Energy mismanaged the underground burning of coal seams, which caused rock to fracture and allowed the escape of toxic gases which contaminated the air, soil and water on site.

The court heard the highest fine imposed upon a company so far in Queensland for similar offending was $500,000.

Linc Energy did not defend itself during the trial because it is now in liquidation.

Five executive directors have been charged with failing to ensure compliance of the company and are due to face a committal hearing in the Brisbane Magistrates Court in July.

Prosecutor Ralph Devlin told the court the company knew it was causing damage but pressed ahead with operations, and described its offending as "serious".

"The defendant acted in devious and cavalier way … its motivation was commercial gain," he said.

"It pursued commercial interests over environmental safeguards."

The court heard there would be monitoring and remediation of the site for decades to come, and it will take potentially between 10 to 20 years for groundwater to recover.

Judge Michael Shanahan said despite the fact the company was now in liquidation, there was good reason to impose financial penalties.

"I am unsure of any of its assets or liabilities and capacity to pay fines," he said.

"Linc was well aware of the damage being done … and attempted to hide it from the regulator."

Judge Shanahan said the offending was carried out over seven years and was "persistent and in clear breach" of its obligations.

Queensland Resources Council chief executive Ian Macfarlane said the project had been a "blight" to the environmental and resources council, saying "99.99 per cent of the industry comply by the rules".

"This is one company that stepped outside those rules and I think it's important that the full force of the law was laid against them," Mr Macfarlane said.

Senior Queensland Government Minister Kate Jones said the fine was a clear warning for all companies impacting the environment.

"I'm very pleased with this result," Ms Jones said.

"Clearly Linc Energy has done the wrong thing and the fine sends a very strong message to other companies out there to do the right thing."

Lock the Gate spokesperson Vicki Perrin said she was deeply concerned about Linc Energy's ability to pay the $4.5 million penalty, given they were currently in liquidation.

"The Queensland Government needs to stop approving every mining and gas project that comes before it, and set higher standards in the early stages before we end up with another mess like this," she said.

Source: ABC News

Photo: Nathan Morris, ABC