29 April Submission - Consultation on the Offshore Petroleum and Greenhouse Gas Storage Amendment (Titles Administration and Other Measures) Bill 2021 April 29, 2021 By AMPLA Admin Oil and Gas, Resources and Energy article 0 30 April 2021 Submission - Consultation on the Offshore Petroleum and Greenhouse Gas Storage Amendment (Titles Administration and Other Measures) Bill 2021 AMPLA appreciates the opportunity to provide this submission in response to the above consultation on the draft Offshore Petroleum and Greenhouse Gas Storage Amendment (Titles Administration and Other Measures) Bill 2021 (Bill), which is proposed to amend the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (OPGGS Act). AMPLA also refers to its previous submission in relation to the earlier Consultation on Enhancing Australia’s Decommissioning Framework, dated 3 February 2021 (Previous Submission). About AMPLA AMPLA Limited is a not-for-profit association established to advance the knowledge of law associated with the energy and resources sector. AMPLA was established in 1976 and is the peak body for lawyers in energy, resources, renewables and commodities. AMPLA’s membership represents private practice, inhouse and government lawyers and other industry professionals across Australia, Singapore and other international markets. AMPLA brings together leaders and experts from legal and other professions working in the resources and energy industries to provide opportunities for discussion and research and to contribute to and make recommendations concerning the development of the law and industry policy. AMPLA has drawn on the expertise of its members to make this contribution to the development of the Bill and invites the Government to consider its submission. Summary The Bill will potentially capture a very wide range of ‘change in control’ transactions under the NOPTA approval requirement, including many that have little relevance to a registered titleholder and/or petroleum operations under a petroleum title. This will potentially complicate many corporate re-organisations and investments. Further, the fact that the change in control provisions in the Bill do not reference and are not consistent with analogous Commonwealth legislation will pose problems for industry in interpretation and application of the laws. The imposition of a potential trailing liability, while not a ‘standing’ liability under the OPGGSA, may nonetheless pose significant risks for industry given that the trailing liability may be imposed by the Government using a broad discretionary power and to a very broad class of persons. The series of events or gateways that needs to occur before the trailing liability option of ‘last resort’ is activated by the Government needs to be clearer. The departure of the related person concept under the draft Bill from established approaches can be expected to give rise to significant uncertainty. The combination of discretionary, indefinite trailing liability and the related person concept has the potential to stifle investment, have a negative impact on both the availability and cost of credit to industry, and have a negative effect on board and executive recruitment, retention and company decision making. It is important that there should be appeal or internal review processes for decisions made by the Government about transactions, trailing liability and technical and financial capacity of a titleholder or applicant, to allow for procedural fairness and natural justice. Finally, the provisions of clause 46 of the draft Bill do not specify that a remedial direction that is to be given to a person in respect of whom a determination has been made may only apply in relation to current titles and titles that ceased to be in force on or after 1 January 2021. This should be made clear to avoid concerns about the draft Bill having backdated application and thereby applying laws retrospectively, which should generally be avoided. Changes in company control As indicated in our Previous Submission, AMPLA generally supports the proposal to extend government oversight of commercial transactions that result in substantive changes to ownership and/or control of a titleholder entity through a corporate merger, acquisition or takeover. The Bill as currently drafted however sets a low threshold for the definition of ‘control’ (of 20%) and establishes a tracing regime that means that changes in control right up the corporate chain, potentially in levels of corporate structure well above the level of the registered titleholder, may be subject to NOPTA oversight. The Bill as currently drafted also does not consider the percentage interest held in the petroleum title by the relevant titleholder subject to the change in control. A change in ‘control’, as defined, of a titleholder that holds only a fractional percentage interest in the petroleum title will be subject to NOPTA oversight. The Bill will therefore capture a very wide range of transactions under a NOPTA approval requirement. Large corporate groups that have multiple subsidiaries, one of which might hold a small interest a petroleum title, may require approval from NOPTA for transactions within the corporate group which have little or no impact on the registered titleholder and petroleum operations under the petroleum title. AMPLA acknowledges and supports the Government’s legitimate desire for increased oversight of key commercial transactions that result in substantive changes of control of titleholders. However, AMPLA respectfully submits that by imposing such a low threshold for the definition of ‘control’, and not referring at all to the percentage interest held in the petroleum title by the relevant titleholder affected by the change in control, the Bill will create an additional Government approval requirement that will potentially complicate many corporate re-organisations and investments. This will be a concern in particular for listed entities that are subject to continuous disclosure requirements at law and under stock exchange rules. It is notable also that the change in control provisions in the Bill do not reference and are not consistent with equivalent definitions and concepts in analogous Commonwealth legislation, for example the Corporations Act and Foreign Acquisitions and Takeovers Act. In its Previous Submission, AMPLA urged the Government to have regard to other similar Commonwealth legislation in drafting the change in control provisions. AMPLA notes the possibility to define ‘change in control’ as occurring if an entity starts or stops controlling the register holder under section 50AA of the Corporations Act, or the holder starts or stops being a subsidiary of a corporation under section 46 of the Corporations Act. Utilising such definitions would assist industry greatly with interpretation and application of the new requirements. From AMPLA’s perspective there are certain other potential issues in the Bill which Government might seek to address: There is no right for the parties to a change in control transaction to seek an ‘indicative’ approval from NOPTA, in advance of the transaction being entered into, as to whether the change in control will be approved. An ‘indicative’ approval mechanism would provide more certainty for parties involved in the transaction. There is no appeal or internal review processes for decisions made by NOPTA in respect of whether to approve a change in control transaction. Allowing for appeal or at least internal review to be requested by an affected party for a transaction should be considered to facilitate procedural fairness and natural justice. Finally, the ability for NOPTA to revoke its decision to approve a change in control if there is a ‘change in the circumstances’ and NOPTA ‘considers it appropriate’ is concerning and will lead to significant uncertainty for parties to a transaction, even after NOPTA’s approval has been given. If this provision is retained in the Bill and subsequently enacted, clear guidance will need to be given by Government as to what will constitute a ‘change in circumstances’ and in what circumstances NOPTA will consider it ‘appropriate’ to reverse a decision that has been given. AMPLA notes that allowing NOPTA this right will also significantly complicate share sale agreement / sale and purchase agreement transaction mechanics, which may deter investment. Trailing liability AMPLA acknowledges the findings of the Government’s review of Australia’s decommissioning framework and those of the Walker review, which identified the need to enhance existing trailing liability provisions to protect the interests of the broader community and taxpayers. AMPLA re-emphasises its comments made in its Previous Submission in this respect. In principle, AMPLA’s view is that current and former titleholders should be able to contractually manage the trailing liability risks satisfactorily as between themselves, and the risks which are sought to be addressed by the proposed expanded trailing liability provisions are best addressed through the exercise of NOPTA’s enhanced oversight over transfers, dealings and now changes in control. The proposal that current and former titleholders, related bodies corporate and other ‘related persons’ may be subject to trailing liability to remediate or decommission a site even post-approval to sell or post-consent to surrender will pose significant issues for industry. The possibility of a requirement to maintain financial assurance to cover trailing liabilities as long as a remedial direction is in force (as per clause 43 of the draft Bill), possibly indefinitely post-sale or post-surrender, will also pose significant issues for industry. In many instances, contingent liabilities related to trailing liabilities will not be able to be removed from company balance sheets. This will be a barrier to ‘clean exit’ by investors and has the potential to deter investment. If expanded trailing liability provisions are to be implemented, then the proposal that such provisions will function only as a “last resort measure”, consistent with the position in the UK, is supported. Further, the intention to generally apply the trailing liability provisions to “ensure the risks and liabilities of petroleum activities remain the responsibility of those who have derived the greatest financial benefits from the project” is acknowledged. Policy and guidance material that supports the trailing liability provisions will need to strongly emphasise these principles (which are not apparent prima facie from the text of the Bill itself). The legislation, policy or guidance materials (ideally legislation) should also clearly specify what is the series of events or gateways that need to occur, before the trailing liability option of ‘last resort’ will be activated by Government. Again, this is not apparent prima facie from the text of the Bill itself – as it is, the trailing liability provisions may be activated in respect of a current or former title simply by determination of the relevant regulatory body, which is subject to few constraints. Unless the series of events or gateways that need to occur before the trailing liability option of ‘last resort’ is activated is made clear, then the uncertain prospect of a trailing liability obligation being imposed at any time at the discretion of a regulator – with that liability then attaching to potential criminal liabilities including imprisonment – will be a significant issue for industry, and essentially no better than the alternative option the Government considered imposing of a standing obligation in respect of trailing liability under the OPGGS Act. AMPLA also has significant concerns regarding the concept of a ‘related person’ under the Bill. The breadth of this concept (i.e. possibly applying to any person that was capable of significantly benefiting, or has significantly benefited, financially from the operations, has been in a position to influence compliance and/or acts or has acted jointly with the titleholder) is notable. Under these broad powers, a determination could conceivably be made – and remedial direction issued to – not only certain company officers (which AMPLA acknowledges may be appropriate in certain circumstances) but also potentially other employees in management positions, external administrators, receivers and liquidators, financiers, consultants and advisors (including legal advisors). These classes of person may have benefited financially or been in a position to influence compliance by the current or former registered titleholder or related body corporate, which would trigger the provisions. However, AMPLA’s view is that such persons should not have any primary obligation / liability for decommissioning, at least in the absence of it being established that they contributed to or were aware of conduct which resulted in the titleholder failing to meet its decommissioning obligations. In the absence of amendment to the Bill or detailed additional policy/guidance material being released to support the provisions of the Bill in this respect, such a broad and amorphous concept of who is a ‘related person’ has the potential to stifle investment, have a negative impact on both the availability and cost of credit to industry, and have a negative effect on board and executive recruitment, retention and company decision making. AMPLA also has concerns regarding the breadth of obligations that former titleholders, related bodies corporate and other ‘related persons’ can be subject to if a remedial direction is in force – i.e. not only those relating to restoration of the environment but also more general obligations included in the provisions of section 569 OPGSSA (work practices), section 571 (provision of financial assurance), part 6.1A (polluter pays), part 6.2 (directions relating to petroleum), part 6.5 (compliance and enforcement), schedules 2A and 2B (environmental management and well integrity), clause 13A of Schedule 3 (duties related to wells) and Part 4 of Schedule 3 (OHS inspections). In other words, a former titleholder, related body corporate or other ‘related person’ can essentially be required to assume all of the usual statutory obligations and liabilities of an actual titleholder entity, for the time that a remedial direction is in force (i.e. indefinitely). Suitability AMPLA supports the provisions of the Bill related to assessment and reassessment of technical and financial capacity of titleholders, via the provisions for examination of ‘whether the technical advice and financial resources available’ available to the titleholder or applicant are sufficient. Such provisions should provide a higher degree of comfort and assurance that titleholders have the requisite ability to meet their statutory commitments. As noted in the Previous Submission, AMPLA believes that it is important that the OPGGS Act and related guidance establish clear and objective criteria for the regulators’ assessment of technical and financial capacity, and there should be appeal or internal review processes for decisions made by the regulator about the technical and financial capacity of a titleholder or applicant, to allow for procedural fairness and natural justice. Certain clear and objective criteria have been outlined in the amendments contained in Schedule 3 of the Bill and in the proposed new s695YB of the OPGGS Act, contained in the Bill, which is helpful. However, there does not appear to be any appeal or review processes included. Other matters AMPLA strongly supports the provisions of the Bill aimed at facilitating electronic submission of various documents to NOPTA. This should reduce administrative burden and streamline application processes for industry. AMPLA urges the Government and NOPTA specifically to continue working with the legal community and industry on the roll-out of these electronic/digital processes, an initiative which is appreciated. AMPLA notes that the Bill and accompanying information do not appear to contain any provisions materially amending the financial assurance provisions of the OPGGS Act (other than as outlined above, to apply those provisions to persons issued remedial directions under the new trailing liability framework). AMPLA urges the Government to comprehensively consult on any new or revised financial assurance requirements, before their implementation, whether that implementation occurs via legislation, policy and/or guidelines. Transitional provisions It is noted that the remedial directions power is generally proposed to only apply in relation to current titles and titles that ceased to be in force on or after 1 January 2021. AMPLA supports the decision by Government not to apply the measures ‘retrospectively’ to titles that ceased before 1 January 2021. AMPLA notes that the provisions of the draft Bill do not specify that a remedial direction that is to be given to a person in respect of whom a determination has been made may only apply in relation to current titles and titles that ceased to be in force on or after 1 January 2021. AMPLA queries whether Government is intending to allow for remedial directions to be given to persons in respect of whom a determination has been made irrespective of whether or when the relevant title ceased to be force. AMPLA would not support such a position given this would be a law of broad application (see comments on breadth of concept of ‘related person’ above) having backdated application. Where laws are to be imposed with backdated application, there should be strong policy reasons for doing so, general caution should be exercised and careful consideration should be given. Gordon Bunyan Ryan Hartfield Executive Director Chair Related Articles SANTOS V TIPAKALIPPA: JUDICIAL GUIDANCE ON THE REQUIREMENTS FOR OFFSHORE PETROLEUM EP CONSULTATION In the Santos v Tipakalippa decision, the Full Federal Court has given guidance to offshore petroleum titleholders in respect of the consultation obligations that they need to satisfy in order to obtain NOPSEMA’s acceptance of environment plans that they submit for the purposes of conducting their respective petroleum activities. The Full Federal Court’s decision may, however, have wider impacts, including on the consultation that may be required to be undertaken by a project proponent under the Commonwealth Offshore Electricity Infrastructure legislation in order to develop an offshore renewable energy project. Submission - DISER Consultation Paper December 2020 ‘Enhancing Australia’s decommissioning framework for offshore oil and gas activities’ COMMUNITY LEGAL RIGHTS IN MINE CLOSURE PLANNING; A COMPARATIVE ANALYSIS OF THREE AUSTRALIAN STATES Professor Alex Gardner, University of Western Australia Law School, and Laura Hamblin, formerly research associate at the UWA Law School, 2021 Why does the Mining Act 1978 (WA) not provide secure legal rights for community consultation in relation to mining lease proposals and mine closure plans? Addressing this question presents an important theme for this comparative review of some core features of the regulatory frameworks for mine closure in three Australian States. It also raises important questions for future legal research. Western Australia, Queensland and Victoria have prominent but vastly different, and thus uniquely significant, mining industries. Western Australia’s mining industry has a long history of large and smaller scale mining of a diverse range of minerals by various methods that pose significant mine rehabilitation challenges.[i] Queensland’s mining industry is similarly large and diverse, dominated by export coal production, and planning future minerals development in a decarbonising world.[ii] Victoria has a smaller mining industry with a large historical legacy dominated by a coal mining industry for domestic electricity generation in the Latrobe Valley, which is closing as the State actively transitions to renewable power sources.[iii] These States also have significant differences in the regulation of their mining industries. What all three States do have in common is the significance of their mining industries to both the State economy and the communities who depend on or live near mining operations. Importantly, all three States are confronting large legal and regulatory challenges in managing mine rehabilitation and closure. The key to addressing these challenges is effective mine closure planning: the closure of a mine site has ripple effects that are not merely environmental and economic, but social and cultural too. The initial approval of a mine closure plan occurs before any mining has begun and, with the life cycle of a mine often spanning decades, regulatory bodies are approving hypothetical closure scenarios, potentially subject to vast changes. Regulatory bodies may then seek to enforce closure requirements enshrined in a plan that may wane in relevance as mining operations progress, the updating of which may depend on the miner. Yet remedying the regulatory system so that it creates adaptable but consistently effective mine closure outcomes for affected communities still begins at planning. Although that planning is an iterative process across the life of the mine, it is very important at the initial stage of approval. Recent legislative reforms in all three States are adding to the regulatory rigour and adaptability of mine closure planning, though there are very different legal requirements for community consultation. This article aims to explain and assess the regulatory reforms by undertaking a comparative analysis of mine closure planning across Western Australia, Queensland and Victoria, with a focus on the initial approval stage and how stakeholders and communities are brought into that process. The facilitation of continuous and comprehensive community engagement is critical to ensuring that mine closure planning accounts for environmental, economic, social, cultural and safety outcomes after mine closure, but it has not been possible to consider here the process of ongoing mine closure planning, especially for amending mine closure plans and determining satisfaction of mine closure plans leading to resource tenure relinquishment.[iv] The article begins by considering core concepts of mine closure planning and the regulatory goals that inform it. It then provides a comparative overview of each State’s mine closure planning requirements under the mineral resources, environmental and land use planning laws and draws out some of the different regulatory structures and processes for mine closure within each State. The third step in our analysis compares the ways in which those laws provide for local communities’ participation in mine closure planning, with specific attention to whether the regulatory provisions create legally enforceable rights for effective community engagement. The article concludes with a summary of the key points from the discussion of three themes in our analysis: (i) the importance of clear definitions of core concepts and key goals, (ii) mine closure planning as an essential part of a mining proposal, and (iii) the legal definition of community engagement and consultation rights. Mine closure planning and implementation is necessarily influenced by many other spheres of law including taxation law, investment law, water law, and the rights of traditional owners, to name a few. A potentially directly relevant Commonwealth law is the Environment Protection and Biodiversity Conservation Act 1999 (Cth), which may require environmental impact assessment of a mining proposal and closure plan and lead to approval conditions supplementing State requirements.[v] Whilst acknowledging the importance of these adjacent spheres of the regulatory frameworks for effective mine closure planning, this article does not attempt to address their impact. In particular, the rights of Traditional Custodians are a crucial part of mine closure planning that are only briefly noted here and that would benefit from future research. WA Department of Mines, Industry Regulation and Safety, Major Commodities Review 2022-23”. Qld Government, Department of Resources, Queensland Resources Industry Development Plan, June 022. Vic Government, Department of Jobs, Precincts and Regions, Latrobe Valley Regional Rehabilitation Strategy. See L Hamblin, A Gardner, Y Haigh, Mapping the Regulatory Framework of Mine Closure, May 2022, CRC TiME, for a broader exploration of the full life cycle of mine closure regulation. In Buzzacott v Minister for Sustainability, Environment, Water, Population and Communities [2013] FCAFC 111; (2013) 214 FCR 301, [144], [227]-[230], referring to the range of approval conditions, which included mine closure. In setting conditions under the EPBC Act, the Commonwealth Minister must consider any relevant conditions under State or Territory law: at [80] citing Lansen v Minister for Environment and Heritage (2008) 174 FCR 14. QUEENSLAND’S MINE REHABILITATION REQUIREMENTS FOR VOIDS: ENSHAM CASE STUDY The State of Queensland reformed its mine rehabilitation legislation, namely the Environmental Protection Act 1994 (Qld) (EP Act), in 2018 through the Mineral and Energy Resources (Financial Provisioning) Act 2018 (Qld) (MERFP Act). A case study of the Ensham open-cut coal mine[i] in central Queensland highlights three issues for the efficacy of this regulatory framework. The first issue concerns an available exclusion of rehabilitation requirements for existing mining voids (the area of excavation created by open cut mining) in flood plains. Under the EP Act, as amended by the MERFP Act, a holder of an environmental authority (EA) may, in its Progressive Rehabilitation and Closure Plan (PRCP) and PRCP Schedule, identify land as a Non-use Management Area (NUMA).[ii] This is land that would not be rehabilitated “to a stable condition” and not have a post-mining land use. This rehabilitation exception as a NUMA is not applicable to mining voids wholly or partly in flood plains – these must be rehabilitated to a “stable condition”,[iii] as defined in the EP Act. This is the “section 126D(3) rehabilitation obligation”.[iv] However, the transitional provisions of the mining rehabilitation reforms differentiate the rehabilitation obligations of pre-existing mines (those existing at the time of the reforms, such as the Ensham Mine) and new site-specific mines.[v] Pre-existing mines with a “land outcome document” that presents an outcome similar to a NUMA can establish criteria for rehabilitation or management of a void in a flood plain that supersede this section 126D(3) rehabilitation obligation.[vi] The MERFP Bill Explanatory Notes for the transitional provisions reveal that this exemption from section 126D(3) “does not retrospectively breach existing rights and provides certainty to industry on the transitional process”.[vii] However, this grandfathering is arguably disconnected from environmental risks of such residual voids, creating two classes of mines based on the timing of a mine’s existence (pre-existing versus new). This Ensham case study provides an example of a pre-existing mine’s use of a “land outcome document” to exempt rehabilitation of residual voids in a flood plain but without clarity around the non-use management status of the area of the residual voids. The second issue discussed in this case study is progressive rehabilitation. The design of a financial assurance system to increase progressive rehabilitation was “a clear objective of the EPA’s work in 2004”, yet the EP Act fell short by failing to clearly outline criteria for certification of final rehabilitation for industry, and a scheme of refunding financial assurances at the termination of mining activity.[viii] These issues remained unaddressed until the 2015 State election when the then Labor Opposition ran on the campaign “[to] investigate the expansion of upfront rehabilitation bonds for resource companies to fully fund long-term rehabilitation activities”.[ix] Thereafter, the Queensland Treasury Corporation published a number of discussion papers advising of the shortcomings of the current financial assurance framework and that, in 2017, there were “220,000 hectares of disturbance, with an estimated rehabilitation cost of $8.7 billion”.[x] Queensland’s 2018 mining regulation amendments concerning progressive rehabilitation were intended to ensure “rigorous” review of NUMA approvals in PRCPs, “through an objective public interest evaluation” for future or newly established mines.[xi] However, the reforms may not effectively address instances in which progressive rehabilitation has been lacking in large, open-cut, mature mines in operation at the time of these legislative changes. As of 2021, approximately 33% of the Ensham Mine’s 4,944.7 ha of scheduled rehabilitation areas had been progressively rehabilitated.[xii] According to Ensham’s PRCP, this level of progressive rehabilitation exceeds that of other open-cut mines in Queensland.[xiii] For established mines, such as Ensham, that are approaching closure and have large voids that have not been substantially progressively rehabilitated across their mine life, the most economical rehabilitation option may be to rehabilitate residual voids to accord with legislated requirements. Under Queensland’s legislation, “rehabilitation” does not necessarily mean these voids will be re-filled. This may be contrary to community understanding of what rehabilitation is. Thirdly, this case study highlights areas in the regulatory framework in which information transparency could be improved – particularly public access to information – which raises issues of accountability, quality of community engagement and, ultimately, social licence on the part of mining companies and government. Information transparency is also relevant to community engagement and expectations for rehabilitation, such as the meaning of “rehabilitation” of residual voids (i.e., refilling to establish a pre-mining state versus the legislated “stable condition” standard). This article is structured as follows. Part 2 presents the legal and operational context of the Ensham Mine. It also describes the operational history of flooding and its relevance to rehabilitation and management of post-mining residual risks, which leads to a discussion of the rehabilitation legal reforms. Part 3 discusses the reform of Queensland’s rehabilitation legislation framework as it concerns residual voids, including the transitional provisions of the EP Act. Part 3 also explores Ensham’s Residual Void Project (RVP) for the development of the rehabilitation criteria for residual voids and considers the community engagement process. Part 4 comments on the transitional regulatory design issues in Queensland’s framework, issues concerning progressive rehabilitation of pre-existing open-cut mines such as Ensham, as well as transparency of information and community consultation. Part 5 concludes and suggests future research. Land Access Agreements for Petroleum Exploration in the Northern Territory: the Tanumbirini Station and Beetaloo Station Decisions Bradly Torgan BA (Duke), MRP (UNC), JD (UNC), MEL (Syd) Special Counsel, Ward Keller, Darwin NT The Tanumbirini Station and Beetaloo Station decisions, first before the Northern Territory Civil and Administrative Tribunal and then on appeal to the Northern Territory Supreme Court, represent the first decisions under the land access agreement provisions of the Petroleum Regulations 2020 (NT). They establish jurisdictional boundaries under which the Tribunal can determine an access agreement, guidance on when the Tribunal will exercise its discretion to do so, and guidance on the terms of an access agreement. The decisions also provide a cautionary tale to landowners demanding compensation prospectively for anything other than the drilling of a well. The parties may agree to comprehensive prospective compensation in principle, but if negotiations fail and the matter goes to litigation the landowner stands to get nothing beyond compensation for the drilling of a well. Introduction The Petroleum Regulations 2020 (NT) (the Regulations) came into force on 1 January 2021. Amongst the changes from the Petroleum Regulations 1994 (NT) that the Regulations replaced was the requirement for a land access agreement (access agreement) to undertake exploration activities:[i] a petroleum interest holder could no longer commence regulated operations on a particular area of land without having an access agreement in place with the landowner or occupier of the land holding a registered interest, referred to in the Regulations as the designated person.[ii] In the Northern Territory, the designated person is typically a pastoral lessee under the Pastoral Land Act 1992 (NT). While the Petroleum Act 1984 (NT) (the Act) provides for compensation to pastoralists or other owner/occupiers for any damages or deprivation of use of the land caused by the interest holder,[iii] access agreement guidelines prior to the Regulations had no force of law. The requirement that an access agreement be in place prior to exploration commencing arose from a recommendation of the 2018 Final Report of the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory (Fracking Inquiry),[iv] which the Northern Territory government had commissioned and whose recommendations it promised to implement in lifting a moratorium on hydraulic fracturing that had been in place since 2016. The recommendation was designed to level what was seen as an unequal negotiating structure between pastoralists and petroleum companies that disadvantaged the pastoralists. The enactment of the access agreement provisions brought the Territory more into line with other jurisdictions for which agreements are required before most petroleum exploration activities can occur.[v] The Regulations contain twenty-five standard minimum protections (SMPs) that every access agreement is required to address.[vi] They include the minimum amount of compensation payable for the drilling of a well on the land,[vii] sometimes referred to as SMP 12, and a statement of whether it is anticipated that any of the exploration and related activities carried out on the land will lead to a decrease in market value of the land. If that question is answered in the affirmative, the agreement must provide a preliminary assessment of the amount of the decrease.[viii] This statement and assessment is sometimes referred to as SMP 13. What the SMPs do not mandate, however, is determinations of prospective compensation payable for anything other than a minimum amount for the drilling of a well. The Regulations provide a multi-step negotiations process, including alternative dispute resolution.[ix] If negotiations fail, the interest holder can apply to the Northern Territory Civil and Administrative Tribunal (Tribunal) for determination of an access agreement.[x] Judicial review by the Northern Territory Supreme Court may be sought on questions of law for any Tribunal decision determining or refusing to determine an access agreement.[xi] While most access agreements in the Northern Territory are the result of successful negotiations between the interest holder and the designated person, negotiations in two instances failed, with the interest holder seeking and securing determinations of access agreements by the Tribunal. The decisions in access agreement disputes before the Tribunal, Sweetpea Petroleum Pty Ltd v Rallen Australia Pty Ltd (Tanumbirini)[xii] and Sweetpea Petroleum Pty Ltd v Yarabala Pty Ltd & BB Barkly Pty Ltd (Beetaloo),[xiii] dated 7 February 2022, addressed access over two adjacent pastoral leaseholds in the gas rich Beetaloo sub-basin, Tanumbirini Station and Beetaloo Station. The decisions were similar, but consequential orders in Tanumbirini resulted in the determination of an access agreement over Tanumbirini Station,[xiv] while the decision in Beetaloo remained interlocutory. The Tanumbirini determination was upheld by the Northern Territory Supreme Court in Rallen Australia Pty Ltd v Sweetpea Petroleum Pty Ltd (Tanumbirini Appeal),[xv] issued on 20 April 2023. A ruling upholding the Beetaloo decision, Yarabala Pty Ltd and BB Barkly Pty Ltd v Sweetpea Petroleum Pty Ltd (Beetaloo Appeal),[xvi] followed on 9 June 2023. This article first analyses the Tanumbirini decision because of the similarities between it and the Beetaloo decision, although differences between the two are noted, before turning to the Tanumbirini Appeal. The article then reviews major differences between the Tanumbirini Appeal and Beetaloo Appeal before discussing the impacts of the decisions. [i] Petroleum Regulations 2020 (NT), reg 12(1). [ii] Above n 1, Regulations, regs 3, 13(1)(b). [iii] Petroleum Act 1984 (NT) (28/11/2022–22/06/2023), s 82(1). [iv] Hon Justice Rachel Pepper (Chair), Final Report: Scientific Inquiry into Hydraulic Fracturing in the Northern Territory (NT Government, 2018), Rec 14.6, 394-395. [v] See, e.g., Petroleum and Geothermal Energy Resources Act 1967 (WA) (PGER Act), s 16; Petroleum (Onshore) Act 1991 (NSW) (PO Act), s 69C; Mineral and Energy Resources (Common Provisions) Act 2014 (Qld) (MERCP Act), s 43. [vi] Above n 1, Regulations, reg 14, sch 2. [vii] Above n 1, Regulations, reg 14, sch 2, cl 12(1). [viii] Above n 1, Regulations, reg 14, sch 2, cl 13(1). [ix] Above n 1, Regulations, regs 14, 25-26. [x] Above n 1, Regulations regs 14, 29. [xi] Northern Territory Civil and Administrative Tribunal Act 2014 (NT), s 141(1). [xii] Sweetpea Petroleum Pty Ltd v Rallen Australia Pty Ltd [2022] NTCAT 1. [xiii] Sweetpea Petroleum Pty Ltd v Yarabala Pty Ltd & BB Barkly Pty Ltd, NTCAT File no 2021-02699-CT (7 February 2022). As of the date of the writing of this article, Beetaloo has not been published. [xiv] Above n 12, [2022] NTCAT 1,Tanumbirini, n 1. [xv] Rallen Australia Pty Ltd v Sweetpea Petroleum Pty Ltd [2023] NTSC 36. [xvi] Yarabala Pty Ltd and BB Barkly Pty Ltd v Sweetpea Petroleum Pty Ltd [2023] NTSC 50. ARELJ - Case Note - Australian Offshore Petroleum Regulation: Defining and Protecting the National Interest Showing 0 Comment Comments are closed.