from Crikey .....

A key element of Bob Katter's regional development wish-list presented to the major parties will directly benefit companies owned or controlled by Katter's brother-in-law, and was spruiked by the Member for Kennedy for months in 2009 before Katter acknowledged the conflict of interest.

The Copperstring project is one of several projects mooted as the solution to the problem of providing the emerging need for baseload power to north-western Queensland. There have been several proposals put forward: expanding existing power generation capacity at Mica Creek at Mt Isa, and three proposals to build a transmission line "energy corridor" to the region, including one backed by Hong Kong interests.

The Queensland Government, following the recommendations of an independent review, established a process in 2009 to determine which project would be best.

The Copperstring project would build a 400 MW AC transmission line from Woodstock, south of Townsville, 700km west to Cloncurry, picking up power from renewable energy projects along the way. The project was first announced by the company VisIR, headed by John O'Brien, a Queensland energy consultant and the managing director and a major shareholder of energy consultants Hill Michael, in December 2008.

On 25 May last year, Katter first raised the issue in Parliament, using one of his rare Question Time opportunities to ask Kevin Rudd to consider a "clean energy corridor". Just over a week later, Katter raised the matter again while debating the CPRS bills, describing in detail an "energy corridor" proposal similar to the Copperstring project.

What Katter did not reveal at the time was that O'Brien was his brother-in-law - he is married to Katter's sister, Geraldine.

O'Brien, who lives in Townsville (at least one of his companies is registered to his residential address in Mundingburra) is a key figure in Copperstring. The project is described on its website as "a partnership between CuString Pty Ltd and Leighton Contractors Limited." Leighton owns the Copperstring website, via a Brisbane PR firm, and last week began a series of consultations with local residents on the project.

CuString, which was not established until June 2009, is owned by O'Brien, who also controls VisIR, the original proponent of the project. According to a presentation given by O'Brien to a North Queensland Energy Forum in November 2009, CuString Pty Ltd would be the project owner, VisIR would be the project developer, and Hill Michael would provide regulatory and technical advice.

Katter, aware that the Government had committed hundreds of millions of dollars in renewable energy funding in the 2009 Budget, was successful in his lobbying of the Government for the project. He raised the project another four times in Parliament between June and August, in Question Time, debates and MPIs, and, without identifying the Copperstring project specifically, publicly called for funding for the specific route proposed by O'Brien's group.

In August, Wayne Swan announced he'd convene a Renewables Business Roundtable with Katter and Resources and Energy Minister Martin Ferguson later in the year.

It was only on 17 September that Katter revealed the role of his brother-in-law, amending his Statement of Pecuniary Interests thus:

I would like to advise the Register of Members' Interests that I have been negotiating with various energy companies for a clean energy corridor into the North West Mineral province. One of the companies involved with the negotiations, Hill Michael, is headed up by Mr John O'Brien who is my brother-in-law.

Katter's letter understates the role of O'Brien, who is central to the proposal that Katter had been spruiking, and not entirely via his role at Hill Michael. He also has some form in regard to O'Brien. In 1999, Katter, who at that stage was still a National Party MP, gave evidence to a Productivity Commission inquiry into the impact of competition policy and cited O'Brien as a local expert on electricity transmission, without mentioning his relationship.

Katter this year has continued to regularly urge funding for the project, without ever again mentioning his connection to O'Brien on the public record. It was only in June this year that the Queensland Government determined that, of the several competing NW energy projects, the Copperstring project should proceed to a feasibility study, and declared it to be "significant". It has also been referred to the Commonwealth under the Environment Protection and Biodiversity Conservation Act.

As part of her climate change announcement at the start of the election campaign, Julia Gillard promised $100m to connect up renewable energy sources to the national energy grid, specifically identifying the north-west energy corridor as a potential destination for funding.

The Coalition effort to commit to the project came unstuck the following week when Barnaby Joyce, Ian Macdonald and Ian Macfarlane, who had visited Townsville to announce renewable energy funding, argued over whether funding would be made available for the energy corridor project.

Yesterday Katter identified a "recommitment to Copperstring" as one of his key demands in negotiations with the major parties - marking the first time Katter had explicitly and directly linked himself to the project by name.

A spokesperson for Katter took up this issue when contacted by Crikey. "The Clean Energy Corridor is not CopperString; the concept of a renewable energy corridor in northern Queensland has been a concept considered for quite some time and pushed most prominently by Townsville Enterprise and MITEZ," she told us. "Given the resources industry has selected its preferred transmission line project from a public and transparent process, Bob as the member for Kennedy has supported CopperString as that selected project."

As noted above, Katter was supporting the specific concept proposed by Copperstring well before it was selected by the Queensland Government to proceed to feasibility study.

She also defended Katter's disclosure of his relationship.

Not surprisingly, the relationship between Bob Katter and John O'Brien is very well known in North Queensland, and has been clearly stated in the press over a number of years (including a letter to the ed published in the Townsville Bulletin last year, as I understand). It is well known to members of both sides of politics at both State and Federal level as well as other stakeholders in the Sims Review process and broader context of the development. As I understand it, among other people who are aware of this relationship directly (rather than simply via Bob's disclosure on the pecuniary register) are a very wide range of politicians at state and federal level including Martin Ferguson, Ian MacFarlane; Peter Lindsay, Betty Kiernan, Craig Wallace, Ewan Jones, Tony Mooney, Stirling Hinchliffe and many others.

As of deadline, Crikey has not yet been able to find a letter from Katter to the Townsville Bulletin about the issue online. Katter's spokeswoman also noted that neither Katter nor his family stand to benefit in any way from the Copperstring project.

The energy needs of north-west Queensland are a real issue, especially given the likely development of resources in that area. Copperstring may indeed be the best project to address those needs out of the four options that are realistically under consideration - that is the view of the Queensland Government. And John O'Brien has an extensive and successful record in the transmission industry. But Bob Katter's advocacy of one project with what appears to be only a single, limited acknowledgement of a major conflict of interest is significantly at odds with the greater transparency he and the other independents have demanded of the major parties.

Katter's attitude may best be summed up by his concluding statement on his Register of Pecuniary Interests. It's the same one he made there in previous Parliaments. Asked to identify any other conflict of interests that might arise, Katter wrote "no - but being from a business background within the past many diverse interests and always keen to be involved commercially in the future and would in the future and whatever action taken in my work could involve some pecuniary interest."

Copperstring was unable to respond before deadline; their response will be carried when provided.