brett cohen, clayton utz - northern territory mining regulations
DESCRIPTION
Brett Cohen, Clayton Utz delivered the presentation at the 2013 Mining the Territory Conference. Mining the Territory Conference is part of the Northern Territory Resources Week. It provides the perfect platform for stakeholders in the NT mining industry to hear the latest information on this booming region. For more information about the event, please visit: http://www.miningnt.com.au/miningnt2013conferenceTRANSCRIPT
Northern Territory Mining Regulations
Brett Cohen Partner - Clayton Utz
Mining the Territory Conference Darwin, 11 September 2013
© Clayton Utz
The mining industry
• The Territory's largest
• Over 20% of GSP
• $2.5b in revenue
• Employs around 5000 people
• However, vast areas remain under-explored, and
quality projects remain undeveloped
• A climate of constrained access to capital - Vital that
regulations are proportionate and cost-effective
Mining and exploration in the Territory
• Snapshot of the NT regulatory framework
• The NT Mining Management Act (MMA)
• Wholesale recent changes to the MMA
• Environmental securities
• New levy on mining rehabilitation securities
The NT regulatory framework
• Combination of NT and Commonwealth laws regulate
mining activities
• Fraser Institute survey 2012 - NT the top ranked
jurisdiction in Australia for ease of doing business in
minerals exploration and mining investment
• Maintaining the right regulation balance between
facilitating business activity, and community benefits
Mining activities - primary laws
Titles and tenure
Mineral Titles Act (NT)
Regulates grant and
administration of tenure for mining
activities
Titles and authorities for
exploration, mining and associated
infrastructure
Native Title Act (Cth) and
Aboriginal Land Rights (NT) Act
(Cth) also relevant to grants of
tenure
Conducting mining activities
Mining Management Act (NT)
Regulates safety, health and
environmental aspects of mining
activities
Authorisations required for mining
activities
Management and monitoring of
mining activities; environmental
rehabilitation securities
Significantly amended and
strengthened in recent years
Mining activities - (some) other major laws
Environmental regulation Waste Management and Pollution Control Act (NT)
Environmental Offences and Penalties Act (NT)
Environmental assessments
Environmental Assessment Act (NT)
Environment Protection and Biodiversity Conservation
Act (Cth)
Native title and Aboriginal land rights
Native Title Act (Cth)
Aboriginal Land Rights (NT) Act (Cth)
Heritage and sacred sites
Northern Territory Aboriginal Sacred Sites Act (NT)
Heritage Act (NT)
Dangerous goods
Dangerous Goods Act (NT)
Transport of Dangerous Goods by Road and Rail
(National Uniform Legislation) Act (NT)
Health and safety
Work Health and Safety (National Uniform Legislation) Act (NT)
Water
Mineral Titles Act (NT)
Water Act (NT)
Royalties
Mineral Royalty Act (NT)
Uranium Royalty (Northern Territory) Act (Cth)
Primary agencies and regulators
NT Department of Mines and Energy Mineral titles
Mining Environmental Compliance Division
NT Geological Survey
Native Title and Aboriginal Land Rights Unit
NT Environment Protection Authority
Environmental assessments
Environmental approvals and licences
Cth Department of the Environment,
Water, Heritage, and the Arts
Commonwealth environmental assessments
NT Worksafe
Occupational health and safety
Dangerous goods regulation
NT Department of Lands, Planning and the Environment
Heritage administration
Department of Land Resource Management
Pastoral land administration
Part 4 MMA - Conducting mining activities
To conduct "mining activities" in the NT, require the following
under the MMA:
• valid title ("mining interest") under Mineral Titles Act (Part 4,
Div 1)
• an Authorisation under MMA (Part 4, Div 2)
• submit Mining Management Plan under MMA (Part 4, Div 3)
• lodge security under MMA (Part 4, Div 4)
Part 4 Div 2 MMA - Authorisation of mining activities
"mining activities" defined in s.4 MMA:
• exploration for minerals
• mining for minerals
• processing of minerals, tailings, waste
• decommissioning or rehabilitating a mining site
• handling, transport and storage of minerals, contaminants, waste
• construction, operation, maintenance and removal of plant and buildings
• construction and maintenance of mining-related infrastructure
• operations for care and maintenance of a mining site
When does exploration require an Authorisation?
Under s.35 MMA, only exploration involving "substantial disturbance" of a mining
site requires an Authorisation, that includes:
• land clearing; earthworks (e.g. cutting, filling, excavating, or trenching)
• above-ground works (e.g. roads, buildings, bridges, railways, airstrips,
conveyors, pipelines, telephone lines or powerlines)
• below-ground works (e.g. tunnels, wells, pipelines, conduits, cables)
• waterworks (e.g. dams, canals, drainage or alteration of water courses)
• extracting resources from the land
• stockpiling ore, overburden, waste materials or by-products
• establishing an exploration/workers' camp
• blasting
• activity that is likely to have a significant impact on flora or fauna
When does exploration not require an Authorisation?
According to DME guidance, no "substantial disturbance" for:
• remote sensing, including geophysical surveying (although
active remote sensing and seismic techniques in water do
constitute a "substantial disturbance")
• non-intrusive actions such as fossicking, rock chipping and
soil sampling by non-mechanical means (to assess land's
potential for future exploration - s.17 Mineral Titles Act)
Part 4 Div 3 MMA - Mining Management Plan
Under s.40 MMA, a Mining Management Plan must include the following:
• details of the mining interest (title) held relating to the mining activities
• details of the ownership of the mining interest
• description of the mining activities the Authorisation is required for
• organisational structure details for carrying out the mining activities
• details of the relevant management system for the mining site
• plans of proposed and current mine workings and infrastructure
• plan and costing of closure activities for mining site
• other details and plans as may be required by the Minister
Part 4 Div 4 MMA - Environmental rehabilitation securities
Operator is responsible for rectifying environmental harm arising from
mining activities, and for rehabilitation of affected area
Under s.43 MMA, a security (in the form of cash or bank guarantee)
required in relation to an Authorisation secures any of the following:
• operator's obligation to comply with MMA or an Authorisation
• payment of costs and expenses to prevent, minimise or rectify
environmental harm on a mining site or resulting from mining activities
• payment of costs and expenses to complete rehabilitation of a mining
site
Security is released once criteria specified in the approved closure plan
have been met, upon proof that rehabilitation is adequate
Calculation of environmental securities • Costing of closure activities required in MMP (s.40 MMA)
• Minister determines level of security by balancing protecting the community
from closure liabilities and optimising benefits to the community from
proposed project
• Default expectation is 100% of security calculated for rehabilitation.
Calculation based on actual cost of rehabilitation commensurate with size,
environmental risk and expected project life
• Operator completes self-assessment, by reference to security calculation
form that indicates costs for different disturbances
• Additional security amount then added to fund contingencies arising from
failure of rehabilitation and cover post closure costs (e.g. monitoring,
maintenance, site visits, remediation etc) - currently 15%
Recent changes to MMA - effective 1 July 2012
Result of comprehensive review, implemented wholesale changes to the MMA:
• broadening of environmental offence provisions, and increased penalties
• wider notification requirements for all environmental incidents - previously
only "serious accident or critical incident"
• power for CEO to direct operators to investigate and report on environmental
incidents, and CEO's discretion to publish report
• annual report on environmental performance for minerals mining
• clarification of activities requiring an Authorisation
• changes to process for granting and varying Authorisations
• Minister may require provision of social and economic benefits to
communities affected by mining activities
Recent changes to MMA - effective 1 October 2013
Further changes to MMA:
• non-refundable annual 1% levy on securities - establishment of Mining
Rehabilitation Fund
• removal of mandatory annual report on environmental performance
introduced in 2012 - now affected sites determined by Minister
• extended period for commencing proceedings for offences under the MMA -
3 years up from 12 months
• DME ability to recover costs for investigations and successful prosecutions
• may prescribe minimum security amount by Regulation
• clarification (widening?) of power to make Regulations to impose fees and
charges
Levy on mining rehabilitation securities
• Non-refundable 1% levy on securities, calculated by reference to total
calculated rehabilitation cost
• Decrease of 10% in total security amount payable by operators
(effectively taken from 15% contingency fee applied to securities)
• Primary objective to generate funds to address environmental issues
on legacy mine sites - establishment of Mining Rehabilitation Fund.
33% of funds generated from levy paid into Fund
• 90% of current authorised operators who lodge securities will pay
annual levy of $2,000 or less per site, and 74% will pay a levy of $500
or less per site. Around 5% will pay in excess of $10,000 per site
Levy - DME worked examples (cash securities)
Smaller operator Larger operator
Current security $10,000
Apply 10% discount $9,000
Cash refunded to operator $1,000
1% levy payable $90
Current security $5,000,000
Apply 10% discount $4,500,000
Cash refunded to operator $500,000
1% levy payable $45,000
Contact details
Brett Cohen
Partner - Clayton Utz
Corporate - Energy & Resources
(08) 9426 8462
0434 154 196
www.claytonutz.com