NSW Legislative Council General Purpose Standing Committee No5 - - PowerPoint PPT Presentation

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NSW Legislative Council General Purpose Standing Committee No5 Inquiry concerning coal seam gas: Petroleum (Onshore) Act 1991 (NSW) Marylouise Potts BSc LLB EMBA MEL (commenced) of Marylou Potts Pty Ltd an Incorporated Legal Practice 8

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NSW Legislative Council General Purpose Standing Committee No5 Inquiry concerning coal seam gas: Petroleum (Onshore) Act 1991 (NSW)

Marylouise Potts BSc LLB EMBA MEL (commenced)

Marylou Potts Pty Ltd an Incorporated Legal Practice 8 December 2011 1

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Summary of Submission

MLPPL submission suggests amendment to the Petroleum (Onshore) Act 1991 (NSW) for the

purpose of:

ensuring protection and conservation of water in petroleum exploration and production

activities

establishing a better balance of rights and powers between the landholder and the miner in the

Act 2

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Petroleum (Onshore) Act 1991 NSW

Petroleum (Onshore) Act 1991 (NSW)

Part 1 Preliminary Part 2 Rights of the Crown as to petroleum, helium and carbon dioxide Part 3 Petroleum titles PArt 4 Consent of other government authorities Part 4A Access arrangements for prospecting titles Part 5 Restrictions on titles Part 6 Protection of the environment Part 7 Royalties and fees Part 8 Registration of titles and dealings Part 9 Inspection and control Part 10 Easements and rights of way Part 11 Compensation Part 12 Administration Part 13 Release of information Part 14 Miscellaneous

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Petroleum (Onshore) Act 1991 (NSW) The process

Coal seam gas mining

Petroleum titles

s.8 Invitation of applications, The minister may, by notification in the gazette, invite applications for petroleum titles s9 Minister may grant a petroleum title within the State over any onshore area except: s16 Security required to be given s19 Renewal of title s20 Continuation of title pending renewal s21 Grounds on which application may be refused s22 Cancellation or operational suspension of titles s69C Prospecting to be carried out in accordance with access arrangement s69E Holder of prospecting title to seek access arrangement Part 4A access arrangement either agreed or determined Part 5 EP&A Act Consent for Category 3 Exploration activities such as bore hole drilling and seismic surveys Aquifer interference approval under Water Management Act 2000 (NSW) s27 Discovery of petroleum to be notified immediately to the Minister s32 Direction to holder of exploration licence to apply for a lease s67 Application for Development consent under Part 4.1 of the EP&A Act 1979 + EIS Grant of development consent under the EP&A Act s42 Grant of production lease s43 Notice of application for production lease to be published Part 7 Royalties and fees Part 6 Protection of the Environment including rehabilitation

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Part 1 Petroleum (Onshore) Act 1991 (NSW)

Petroleum (Onshore) Act 1991 (NSW)

Part 1 Preliminary

s3 Definitions Cultivated Land Replace or define Cultivated Land "Agricultural land" has the meaning given in the Mining Act 1992 (NSW) Schedule 2 WA definition "means land being used for agricultural purposes and includes any land, whether cleared or uncleared, used by a person for the grazing of stock in the ordinary course of management of the land of that person where the land so used for grazing forms the whole of part of the land owned or

ccupied by that person."

Environment Insert a definition of Environment Environment has the meaning given in the Protection of the Environment Operations Act 1997 (NSW) Land Include water in the definition of Land as defined in the Contaminated Land Management Act 1997 (NSW). "Land includes water on or below the surface of land and the bed of such water" WA definition of land in the Mining Act includes water Rehabilitate Currently no definition of

rehabilitate. Insert a definition

Rehabilitate means to restore to original or better condition. Restricted Area Currently no definition. Insert a definition "Restricted Areas are defined in s72 of the Act" Water Insert a definition of water as defined in the Contaminated Land Manage- ment Act 1997 (NSW). Water has the meaning given in the Contaminated Land Management Act 1997 (NSW).

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Part 3 Petroleum (Onshore) Act 1991 (NSW)

Petroleum (Onshore) Act 1991 (NSW)

Part 3 Petroleum Titles

s8 Invitation of applications Invitation by notification in the gazette Pre application notification by Government to Landholders Application stage Applicant to directly notify landholders that making the application s9(1)(a) Grant of petroleum titles Minister to gazette "no go zones" Water catchment areas significant groundwater basins urban and town zones + significant buffers for future development s9(5) Notification of grant or refusal Minister to notify landholders of the grant or refusal and provide a copy of the title ss13, 14, 15, 16 Supporting information for applications Supporting documentation to applications be made publicly available as is the case for planning applications old[75H(3)] Misleading or false information to allow for refusal

f applications and be penalised

s20 Continuation of title pending renewal Time limit placed on continuation pending renewal of 6 months s20A Waiver of minor procedural breaches delete or amend to reflect title s21(c) Grounds on which an application may be refused Minister's minimum standards be made publicly available Allow for objections to renewal and additional grounds for rejection failed to satisfy Ministers standards previous breaches of title, Act, regulations or law add additional grounds for the minister to refuse to grant renewal for environmental considerations for protection and conservation s22(1) Cancellation or suspension add additional grounds for the minister to cancel/suspend for environmental grounds s27 Discovery of petroleum No pilot studies under other than PPL conditions as otherwise can produce on cultivated land s71

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Part 4A Petroleum (Onshore) Act 1991 (NSW)

Petroleum (Onshore) Act 1991 (NSW)

Part 4A Access Arrangements for prospecting titles

s69A(1) Application of Part Ensure that access arrangement term extends for so long as the miner has a petroleum title over the land s69C(1) Prospecting to be carried out in accordance with access arrangement Amend to provide prospecting and mining operations to be carried out in accordance with access arrangement s69D(1) Matter for which access arrangement to provide Extend to include determination of and preservation of water provision of a security in favour of the landholder Enable rapid response and not reliance on a third party, govt, to react Provisions of a performance guarantee in favour of the landholder because project specific vehicles are wound up and environmental damage may not show up for some time provision of environmental protection insurance requirement that baseline data be taken on the property by independent experts and they determine on going monitoring and mitigation measures as well as safe levels beyond which mining ceases, rehabilitation measures, requirements according to miner's planned activities and undertake that monitoring, to be engaged by the landholder and paid for by the miner, and if not

ut of the security provided by the miner

survey of property and all existing improvements, structures, features agronomist hydrogeologist hydrochemist doctor vet environmental scientist access arrangement to be in the form of an umbrella agreement with overlying protections applicable and sub agreements for each approval sought by the miner [a similar framework to that provided in the legislation] require the miner to provide the landholder with all information that provides to the govt. landholder must be made aware of what the miner is planning for example a copy of the miner's work program and annual reports Just and equitable compensation for all losses of the landholder including loss of total land value Mr Moore knows that the only person who will now buy his land is the Miner, total loss of land value. Ensure landholder always able to receive expert advice paid for by the miner to enable to landholder to protect the value in the property, protect the water, conserve the environment results of false or misleading information provided by miner are unenforceable contain a concurrent breach provision such that a breach of the Act, the regulations, the law or environmental law

r any approval is a breach of the AA and enables denial of access until remedied

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Part 4A Petroleum (Onshore) Act 1991 (NSW)

Petroleum (Onshore) Act 1991 (NSW)

s69D(1A) and (2A) NSW MC be replaced with APPEA as the appropriate peak body Any template must be evenly cast, if not swung in favour of the weaker party, the landholder Current NSW Miner- als Council template cl2.1 "access ... in the prospecting area" Prospecting area defined and referred to as the area on page 1 Shown on the map - restricted areas often NOT carved out irrevocable consent s72(2) Not just "legal fees in obtain initial advice" but all legal fees QLD legislation recognises that all reasonable legal fees should be covers QLD Govt also recognises that there are a number of other professionals fees which should be covered by the miner including accounting and valuation fees QLD govt has begun providing landholders with legal aid non means tested to assist in negotiation of LAA's Landholders time should also be compensated for their time, everybody else is All specialists time should be paid by miner s69D(4) denial of access for contravention include denial of access for contravention of Act, regulations, petroleum title s69I(2)(b) legal representation in arbitration process allow the landholder as of right, legal representation the landholder is in a significantly vulnerable position vis a vis resources, knowledge,expertise in mining the access arrangement is long term, will involve continual interaction between the parties, will significantly affect the activities of the landholder, and should be accorded significant resources and attention s69N(2) and 69L(1)(a) guidance to arbitrators on when can refuse access Arbitrators may refuse access but anecdotally as- sume only in exceptional circumstances regulations or Act should set out circumstances when access should be refused including as Schmidt J in Brown provides "inadequate protection of the property" and include inadequate protection of the landholders rights under the Act [ie restricted areas not protected] and cultivated land not conserved and aquifers endangered

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Parts 5 - 6 Petroleum (Onshore) Act 1991 (NSW)

Petroleum (Onshore) Act 1991 (NSW)

Part 5 Restrictions on titles

s70(4) Exempted Areas Prescribe catchment areas for urban and town water supplies, and significant basins such as MDB and GAB as exempt areas s71 Restrictions on rights

f holders of leases over

cultivated land Provide a better definition of cultivated land No case law on what constitutes cultivated land Extend so that no mining operations in exploration as well as production on cultivated land use Mining Act definition "agricultural land" and even better the WA mining Act definition LEC should determine what is cultivated land and on the merits s72 Restrictions on rights of title holders on other land Access arrangement practices NSWMC version does not carve out the restricted areas Non access arrangement practices This section applies in any circumstance within the restricted zones, but miners do not request consent if on another's land advise landholders to obtain independent legal advice advise the landholder of rights under s71 and 72 and sign off on that advice remove s72(2) providing that the consent is irrevocable

Part 6 Protection of the Environment

s74(1) Need to protect natural resources to be taken into account Make publicly available the Minister's actual considerations Include protection and conservation of water in those considerations that the minister must take into account s74(2) expand this section to allow the Minister to carry out agricultural and water impact studies s75 Inclusion of conditions for protecting the environment no reference made to the conservation or protection of water s76 Rehabilitation of area damaged by operations include water or amend definition of land to include water Amend the Mine Subsidence Compensation Act 1961 (NSW) to allow for compensation for subsidence from csg /petroleum mining

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Parts 7 - 8 Petroleum (Onshore) Act 1991 (NSW)

Petroleum (Onshore) Act 1991 (NSW)

Part 7 Royalties and fees

s85 Royalty Charge the 10% royalty straight up use the royalty to employ more people to police the industry conduct water impact studies rehabilitate an polluted or contaminated areas pay for economic analysis of cost benefit of csg as well as fugitive emissions study assist landholders in their negotiation of access arrangements by providing them with free legal aid can then issue fewer titles have funding to increase the transparency will discourage speculative mining

Part 8 Registration of titles and dealings

s95(1) Records of titles record with the Registrar General the petroleum title on the register of land titles s95(3) Records of titles make records of titles free of charge

Part 11 Compensation

s107 Compensation amend this section to ensure that any loss in land value no rights until compensation paid or agreed as in the mining Act s109 Measure of compensation compensation for damage to all land not just the surface, so if the aquifer is damaged, compensation should be payable compensation for loss of or damage to water on the basis that paid on an

ngoing basis at water trading rates and

runs with the land

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Parts 13 - 14 Petroleum (Onshore) Act 1991 (NSW)

Petroleum (Onshore) Act 1991(NSW)

Part 13 Release of information

Currently information which is disclosed to the Minister is not released from between 2 [if no

pinion/conclusion

drawn] and 5 [if a conclu‐ sion is drawn] years information should be released and available to the public immediately particularly the work program and any reporting on the work program or changes to the work program. The landholder should have a right to know what the miners are intending to do on its land

Part 14 Miscellaneous

s129 Notice to be given

f cause of danger

Include notice to the landholder of that danger s134B Consents

f landholders

Currently if a landholder "cannot be found after diligent inquiry" the miner may enter the landholder's property and "the

perations may be carried out or the works

erected without the consent of the landholder " Delete this section; or may not enter: (i) without a court order; (ii) only pursuant to the conditions one would see in an access arrangement where the landholder's property is protected, cultivated land is preserved, restricted areas are protected, aquifers protected (iii) only after compensation paid into a trust held for the benefit of the landholder

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Coal seam gas Pipelines and major operators in June2011

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Coal seam gas Well

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Petroleum (Onshore) Act 1991 (NSW) PEL 469 and the Sydney catchment area

SI/56-9 SI/56-13 2311 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2090 2091 2092 2093 2094 2095 2096 2097 2098 2099 2100 2162 2163 2164 2165 2166 2167 2168 2169 2170 2171 2172 2234 2235 2236 2237 2238 2239 2240 2241 2242 2243 2244 2306 2307 2308 2309 2310 2312 2313 2314 2315 2316 2378 2379 2380 2381 2382 2383 2384 2385 2386 2387 2388 2450 2451 2452 2453 2454 2455 2456 2457 2458 2459 2460 2522 2523 2524 2525 2526 2527 2528 2529 2530 2531 2532 2594 2595 2596 2597 2598 2599 2600 2601 2602 2603 2604 2666 2667 2668 2669 2670 2671 2672 2673 2674 2675 2676 2665 2593 2521 2449 2377 2305 2233 2161 2748 2089 2747 2746 2017 2745 2744 1946 1947 2742 1948 2741 1949 2740 2029 1950 2739 2101 1951 2738 2173 1952 1953 2737 1954 1955 1956 1945 1957 2743 2245 2317 2389 2461 2533 2605 2677 2749

DEPARTMENT OF PRIMARY INDUSTRIES

DIAGRAM OF PETROLEUM EXPLORATION LICENCE No. 469 (PELA No. 106) HOLDER: LEICHHARDT RESOURCES PTY LTD 1:250000 MAP SHEETS: SI/56-9 & SI/56-13 SCALE 1: 500000 SUBJECT TO SURVEY File: T08-0154 PLAN No. P10075-01 AREA: abt. 45 Blocks

UNIVERSAL TRANSVERSE MERCATOR PROJECTION HORIZONTAL DATUM: GDA94 Prepared by: G Walker Date: 11-08-2008 Approved by: P.Hord Date: 15-08-2008 Grant Revision: 18-06-2009 Maitland Regional Office The compilation of information shown on this diagram is derived from plans and data, some of which has been produced and provided by third parties.Title boundaries have been adjusted to maintain their relationship with the digital cadastral database in some circumstances, thereby creating certain inaccuracies in the data. This information does not constitute part of the record required under Section 159 of the Mining Act 1992 or Section 95 of the Petroleum (Onshore) Act 1991. The Department of Primary Industries and the State of New South Wales make no statement, representation or warranty that the titles information shown on this diagram is complete, accurate or free from error. Users rely on the titles information supplied on this diagram at their own risk. The Department of Primary Industries and the State of New South Wales accepts no responsibility for any person, acting on, or relying on, or upon any of the titles information shown on this diagram, and disclaim all liability for any loss, damage, cost, expense or injury (including death) incurred or arising by reason of any person using or relying on the titles information contained on this diagram by reason or by any error, omission, defect or misstatement (whether such error, omission or misstatement is caused by or arises from negligence, lack of care or otherwise). Users should always verify historical material by making and relying upon their own separate inquiries prior to making any important decisions

r taking any action on the basis of titles information.

MINERAL RESOURCES

°

DISCLAIMER: NOWRA WOLLONGONG Berry BOWRAL MOSS VALE H U M E H W Y ILLAWARRA HWY PRINCES HWY S H O A LH A VEN R IV E R P A C I F I C O C E A N 4 8 12 16 20 Kilometres J e r v i s B a y Blue Mountains Catchments Cooma Sydney Catchment Authority Drinking water catchments Pumping station Canals and pipelines Prospect Water Filtration Plant

SCA’s drinking water catchments

U p p e r C a n a l Pipelines Braidwood

Canberra

S h

l h a v e n R i v e r Goulburn Nowra Wollongong Lithgow

Sydney

d i l l y R i v e r Bendeela Pondage Lake Yarrunga Nattai River N e p e a n R i v e r W

a R i v e r H a w k e s b u r y R i v e r C

s R i v e r Prospect Reservoir Warragamba Dam Woronora Dam Tallowa Dam Fitzroy Falls Reservoir Woodford Dam Greaves Creek Dam Medlow Dam Cascade Dams Cordeaux Dam Broughtons Pass Weir Pheasants Nest Weir Avon Dam Nepean Dam Cataract Dam Bowral Wingecarribee Reservoir Katoomba Kowmung River Lake Burragorang W i n g e c a r r i b e e R i v e r Dam Crookwell

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Procedure involves a number of steps starting with negotiation, proceeding to conciliation then

arbitration and finally appeal to the LEC

Part 4A of the Petroleum (Onshore) Act concerns the procedure and some of the content of the

access arrangement

Petroleum (Onshore) Act 1991 (NSW)(POA) Part 4A Access Arrangement

Part 4A Access Arrangements Notice to agree access arrangement s69E 28 days

access arrangement agreed notice to agree arbitrator s69F arbitrator agreed 28 days arbitrator not agreed Application to the Director General for the appointment of a member of the arbitration panel as an arbitrator s69G arbitrator appointed arbitrator to send notice to parties of place and time of arbitration 69H(1)(b) Notice 2 Notice 1 Notice 4 from arbitrator Notice 3 Arbitration 14 days Draft access arrangement becomes the final access arrangement Party applies to arbitrator seeking reconsideration of the draft access arrangement s69M(1)(a) seeking variation of draft access arrangement s69M(1)(b) Conciliation s69J Parties agree to access arrangement Arbitrator makes determination giving effect to access arrangement Parties fail to agree access arrangement Arbitrator interim determination s69L no right of access right of access arbitrator to prepare draft access arrangement arbitrator to send determination and draft access arrangement to parties 69L(1)(b) Notice 5 arbitrator must fix place and time for continuing hearing cause notice to be given to the parties s69M Final determination by arbitrator s69N no right of access right of access arbitrator to send final determination and final access arrangement to parties 69N(3)(b) Notice 6 from arbitrator Notice 7 from arbitrator

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Thank you

Marylou Potts Marylou Potts Pty Ltd e ml@mlppl.com.au m 0411 340 775 p 61.2.8012 4994

This presentation represents a brief summary of the law as at December 2011 relating to CSG legislation. It should not be relied upon as definitive,

complete or conclusive. It is not legal advice.