03 Apr 2014

Sowing the seeds of change: Land Access Consultation Draft has improvements and missed opportunities

by Mark Geritz, Prue Harvey

Submissions on the Consultation Draft for land access must be made before 17 April 2014

A consultation draft of proposed legislative provisions for land access has been released by the Department of Natural Resources and Mines as part of the Modernising Queensland's Resources Acts (MQRA) Program and is intended to harmonise the provisions for land access across resource authorisations in Queensland.

This Consultation Draft comes only weeks after the release of the Land Access Implementation Committee Report.

The Consultation Draft contains suggested provisions to implement all of the legislative amendments suggested in the Report (noting that some of the suggestions were not legislative), but it also contains provisions that deal with off-tenure access and with public land (whereas the Report deals only with on-tenure access to private land).

The Consultation Draft applies to tenements (now called authorisations) currently covered by the five resources acts:

  • the Petroleum and Gas (Production and Safety) Act 2004 (PAG Act);
  • the Mineral Resources Act 1989 (MRA);
  • the Petroleum Act 1923;
  • the Geothermal Energy Act 2010; and
  • the Greenhouse Gas Storage Act 2009.

However, the land access provisions for mining leases (as well as prospecting permits and mining claims) are dealt with in their respective grant provisions and are therefore not subject to the Consultation Draft (although they will be dealt with in the MQRA Program as a whole).

Below we discuss the main changes that the Consultation Draft proposes for access and compensation to landholders. The Consultation Draft also seeks to make changes to notifiable road uses and deals with access in a limited overlapping tenement scenario, which we do not discuss in this article.

Private land: On-tenure

What would be the same?

Entry notices would still be required to be issued by the authorisation holder 10 business days before commencing either preliminary or advanced activities (and the entry notice requirement could still be waived in various ways).

Before entering private land to carry out advanced activities, there would still be a general obligation for authorisation holders to have a conduct and compensation agreement (CCA) (or deferral agreement) in place with each owner and occupier of the land or have progressed through the statutory negotiation process which would remain unchanged (ie. issue a notice of intent to negotiate, negotiate for a minimum of 20 business days, issue an election notice, attend a conference or ADR within 20 business days and then file Land Court proceedings).

The heads of damage ("compensatable effects") would also remain the same, as recommended by the Report.

What would be different?

It appears that there may be an intention to remove the entry notice requirement when Land Court proceedings are filed (after complying with the statutory negotiation process). However, the language used is confusing, as it refers to the Land Court "authorising" the access while it considers an application made to the Land Court to decide the compensation liability and access conditions. It is therefore unclear what is needed for the Land Court to "authorise" this access, and whether this is intended to be something more than simply commencing Land Court proceedings. Amendments have not been proposed to the Land Court jurisdiction provisions to reflect any additional "authorisation" power by the Land Court.

The wording that deals with the exemption from the requirement to have a CCA when Land Court proceedings are on foot has also been changed, but the consequences are not clear. At present, there is no obligation to have a CCA if each owner or occupier is an applicant or respondent to a Land Court application relating to the land. As with the entry notice waiver, the proposed new wording adds the requirement that the application is "being considered" by the Land Court. It is not clear whether "being considered" is attempting to make a distinction between proceedings simply being filed as opposed to actually being before the court (for example, a first directions hearing has occurred).

It would become possible for each owner and occupier of the land to opt out of entering into a conduct and compensation agreement or deferral agreement. However, the opt-out option is somewhat of a misnomer, as it still requires the parties to enter into an opt-out agreement, and this doesn't relieve the authorisation holder of the obligation to compensate each owner and occupier of the land. Therefore, given that the opt-out option still requires an agreement to be executed, and yet may not deal with the compensation obligation, we question whether an opt-out agreement really provides much value for an authorisation holder.

As proposed in the Report, an authorisation holder who enters into a conduct and compensation agreement, deferral agreement or opt-out agreement would be required to give written notice of this to the registrar of titles within 28 days of entering into the agreement. The registrar of titles would then be obliged to amend the title register so that a search will show the existence of the agreement. The authorisation holder would also have to notify the titles registrar if the agreement ends. The agreement itself would not be searchable on the register.

The Land Court's jurisdiction is proposed to be expanded to make it clear that it can have regard to the conduct of the parties throughout the negotiation process. However it is unclear what consequences this might have. For example, whether the intention is that the Land Court has the power to issue some sort of penalty or send parties back to negotiation.

In addition, the Land Court can make conduct-based orders (eg. that a party can or cannot do certain activities or that the activities can only occur during certain hours). This additional jurisdiction has the potential to seriously impact on an authorisation holder's ability to carry out activities permitted under the relevant authority.

What is missing?

The Consultation Draft fails to clarify whether parties must agree on an ADR process. For example, the current wording is that a party may call upon the other party to agree to an ADR process. However, there is no clarification as to what happens if the other party refuses to agree to the ADR process (some may assume that the parties must go to a conference, however a recent Supreme Court decision decided otherwise).

The Consultation Draft also does not address the ambiguities in the term "Occupier" by tightening the second limb of the definition, which includes someone a who has been given a "right to occupy". This currently leaves a loophole which landholders have used in order to thwart negotiations, particularly at an advanced stage. For example, by advising of a family trust that is not noted on title, for which the trustee has been given a right to occupy the land.

Later in this article, we discuss the ability for an applicant for an authorisation to give a notice of entry for public land (ie. before the authorisation has been granted). This is a change that could have been implemented for private land and in relation to all the statutory notices that need to be given (eg. notice of intent to negotiate, negotiation notice) and the initiation of Land Court proceedings. An authorisation may take many years to be granted and it therefore makes sense for proponents to use this time to negotiate with landholders so that agreement can be reached in a timely fashion.

The Consultation Draft does not contain any provisions to implement the Report's suggestions to introduce a single accredited form of ADR that integrates seamlessly in to the Land Court process. Perhaps this is intended to be done through a policy guideline or some other mechanism.

Private land: Off-tenure

What would be the same?

The current provisions under the PAG Act are proposed to be implemented across all other authorisations. However, this change does not apply to any MRA tenements (meaning that their regime would stay the same), except for exploration permits.

What would be different?

The current PAG framework would now apply to exploration permits for minerals and coal.

What is missing?

It is unclear as to why the current PAG Act provisions are intended to apply to exploration permits for minerals and coal but not to mineral development licences, which have generally been grouped together for land access purposes.

Public land: Both on and off-tenure

What would be the same?

The provisions relating to the use of public land by authorisation holders in the PAG Act are largely proposed for importation across all resource authorisations. This essentially means that the authorisation holder must give a compliant notice of entry and the public land authority can impose reasonable conditions about the entry. The public land authority can also waive the requirement for the entry notice. There is still a compensation liability, but it need not be agreed prior to entry.

What would be different?

It would become possible to give the notice of entry while still an applicant for the authorisation, meaning that there will be no delay in entering the land, after grant.

A significant change for exploration permits and mineral development licences is the proposed removal of the requirement of the owner of reserve land (including roads) to give consent.

Next steps

Submissions on the Consultation Draft must be made before 17 April 2014 and we would be happy to assist with any questions or in preparing submissions.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.