29 October 2012

Productivity Commission announces inquiry into mineral and energy resource exploration

The Productivity Commission (Commission) has announced a 12 month inquiry into the non financial barriers to mineral and energy resource exploration. The inquiry was established on the recommendation of the Policy Transition Group, which noted that ‘a range of approvals are required before exploration can begin, including land access, native title, indigenous and non-indigenous heritage, environmental, conservation estate and planning and infrastructure approvals.’

The review will investigate areas of duplication across different levels of government and examine exploration approvals and processes to assess their effectiveness and efficiency. The Commission will determine if there is evidence of unnecessary regulatory burden, examine complexity and time frames of government approvals and examine costs of non-financial barriers (including regulatory and related costs).

The review excludes taxation and fiscal policy across all levels of government, the government’s response to the review of the Environment Protection and Biodiversity Conservation Act 1999 (Cth), and indigenous land rights regimes.

Initial submissions are due by the end of March 2013, with a final report to government by the end of September 2013. 

25 October 2012

Another phase of the Streamlining Act rolled out

The latest phase in the slow roll out of the Mines Legislation (Streamlining) Amendment Act 2012, which was passed by State Parliament in August 2012, began last week, though it is not known when the remainder of the legislation will commence.

However given the extent of modification to the existing tenure administration regime, particularly in relation to post-grant dealing registrations, it is likely that we will not see the full system operating for quite some months.

Substantive parts of the tenure administration amendments that commenced last week under this new phase, include key changes, such as:

  • the Minister can now approve mining leases and 1923 petroleum leases  
  • new exploration permit relinquishment requirements (40% by end of year 3, 50% of remaining area by end of year 5)
  • new ability to withdraw objections on mining claims and mining leases
  • Minister’s new ability to issue “notice to progress” applications, and any failure to comply will allow the Minister to reject applications

Uranium ban overturned, but production is years away

The Queensland Government has announced that it will assemble a three member committee to oversee the reintroduction of uranium mining in Queensland.

Despite Australia boasting 31% of the world’s total minable uranium, uranium mining has been banned or contrary to government policy for the better part of 30 years in most states. In Queensland, uranium mining has not occurred since the closure of the Mary Kathleen uranium mine in 1982.

The Queensland Government has never prohibited exploration for uranium, nor has it banned uranium mining by legislation, it has simply made it clear that no mining leases for uranium would be granted as a matter of government policy. Some exploration for uranium deposits has continued in Queensland, with known uranium deposits valued between A$10 billion and A$18 billion. Valhalla, owned by Palladin Energy located 40 km north-west of Mt Isa is the largest known deposit, with significant deposits also located at the Westmoreland (Laramide Resources), Ben Lomund (Mega Uranium) and Maureen (Mega Uranium) deposits.

The relaxation of the federal government’s ‘no new mines’ policy, coupled with the announcement of uranium sales to India, led the Queensland government to move towards the reintroduction of uranium mining. Despite the possibility of A$900 million in royalties, the myriad international, federal and state environmental regulations mean that it could take at least four years for a mine to be developed in Queensland.

16 October 2012

State approves Western Australia’s first uranium mine

Western Australian Environment Minister Bill Marmion has granted approval for Toro Energy to proceed with the State’s first uranium mine to be developed, four years after the Liberal government lifted a ban imposed by Labor. The project is based at the Centipede and Lake Way deposits near Wiluna in the State’s Mid-West, processing approximately 820 tonnes of uranium oxide concentrate per year. The capital cost expected to be about $280 million.

In May, the Environmental Protection Authority recommended the Minister approve the project, subject to strict conditions. Mr Marmion said the environment will be sufficiently monitored in the event that the project obtains Commonwealth approval, with stringent dust management and rehabilitation measures in place to protect stygofauna and groundwater-dependent vegetation.

Environmental groups have criticised the decision, claiming that the uranium industry is fading and the announcement was only made to fast track the Barnett Government’s political agenda.

The Commonwealth is expected to make its decision by the end of 2012. The company hopes to have the mine operating by 2014, with the first uranium sales in 2014-2015.

The decision will likely assist other similar uranium mine projects being developed in W.A.

Herbert Smith Freehills assists the development of many of Western Australia’s significant mining projects and will continue to monitor the development of the uranium industry in WA.