Streamlining Act receives assent!

Further to our recent blog, 10 August, the Queensland Government has taken a significant step towards its commitment to cut red tape for the resources sector by passing the Mines Legislation (Streamlining) Amendment Act 2012 (Qld) (Streamlining Act). The Streamlining Act received assent on 29 August 2012, however the sections that will substantially amend Queensland resources legislation have not yet commenced. The Streamlining Act aims to clarify the legislative framework relating to the compulsory acquisition of land in regards to resource interests, and implement part of the Government’s Streamlining Approvals Project.

The amending provisions that have already commenced aim to clarify the relationship between the compulsory acquisition of land and resource interests. A resumption notice for the taking of land does not extinguish interests (resource interests) under the Mineral Resources Act 1989 (Qld), Petroleum and Gas (Production and Safety) Act 2004 (Qld), Petroleum Act 1923 (Qld), Greenhouse Gas Storage Act 2009 (Qld) and Geothermal Energy Act 2010 (Qld) unless stated in the resumption notice. A resumption notice may provide for the extinguishment of a resource interest only to the extent that the interest is incompatible with the purpose for which the land was taken. If a resource interest is compulsorily acquired, no compensation is payable for the value of that resource.

Other provisions of the Streamlining Act which have commenced provide for the transportation and treatment of coal seam gas water, and other minor amendments. It is not yet known when the remaining provisions of the Streamlining Act will come into force.

Victoria declares ban on fraccing

The Victorian Government has declared bans on:

• approvals to undertake hydraulic fracturing or “fraccing” as part of onshore gas exploration; and
• the issue of new exploration licences for coal seam gas (CSG).

This move follows the ban on fraccing by the New South Wales Government, which has been in place since July 2011.

The measures taken by the Victorian Government do not affect exploration activity approved under current CSG exploration licences that do not involve fraccing, such as surveying and drilling for core samples.

It appears that the bans are a response by the Victorian Government to the pressure exerted by regional community groups, as described in our blog entry of 13 June 2012.

According to the Victorian Government, the bans will remain in place until a national harmonised framework for CSG has been developed. The work program to deliver this framework was announced in December 2011 by Energy and Resources Ministers from across Australia, and results of that work are expected in December this year.

The Minerals Council of Australia has said the Victorian Government’s measures in relation to CSG are ‘profoundly disappointing’. In particular, it states that the decision to rely on the development of a national framework for CSG is ‘concerning’ as the framework may be delayed for years, meaning that Victoria would miss the opportunity to develop an industry that could generate jobs and significant revenue for the state.

Similarly, the Australian Petroleum Production & Exploration Association (APPEA) has said that the Victorian Government’s decision to put the bans in place ‘sends the wrong message to investors and will see the state fall further behind Australia’s rapidly growing resource-rich states’.

There is currently no CSG production in Victoria, and exploration for CSG is in an embryonic stage. Fraccing does not currently occur in Victoria.

Are you prepared for the new Streamlining Bill?

Companies operating in the Queensland energy and resources sector should prepare themselves for the commencement of these new laws and seek specific advice on the effect of these changes.

On 2 August 2012 the Queensland Parliament introduced the Mines Legislation (Streamlining) Amendment Bill 2012 (Qld) (Streamlining Bill) in an effort to cut red tape and streamline regulatory approval processes in the energy and resources sector.

The Streamlining Bill includes amendments to five pieces of Queensland resource legislation and aims to clarify the legislative framework relating to compulsory acquisition, tenure administration and approvals, health and safety and the emerging CSG/LNG industry.

For further information follow the link below

http://www.freehills.com.au/8355.aspx