The coal seam gas (coalbed methane) industry in Australia is practically in its infancy, but major development is expected to occur over the next 40 years. Australia, as the most arid continent in the world, has a duty to manage the potential groundwater issues better than has been done in other countries where the coal seam gas industry has been flourishing for many years. This article attempts to provide a brief overview of some of the issues, along with suggestions for a regulatory response, or further study.