An overview of the evolving land access regime in Queensland and the practical effect of the changes for both landholders and resource authority holders.

Although the Mineral and Energy Resources (Common Provisions) Act 2014 (Qld) (MERCPA) received royal assent on 26 September 2014, a number of the substantive provisions of MERCPA are due to commence on 27 September 2016.[1]

In addition to this, the proposed Mineral and Energy Resources (Common Provisions) Regulation 2015 (Qld) (Regulations) (a consultation draft of which has only been released at this stage) is due to commence on the same day.

MERCPA was introduced as part of the program for “Modernising Queensland’s Resources Acts” with the express aim of making it easier to do business in Queensland. It implements changes to a number of existing resources Acts including the Petroleum and Gas (Production and Safety) Act 2004 (Qld).

Four significant changes implemented by MERCPA are likely to have direct and immediate impacts upon resource authority holders:

  1. The introduction of opt-out agreements as an alternative to conduct and compensation agreements;
  2. The requirement for the Registrar of Titles to be notified of all opt-out agreements and conduct and compensation agreements;
  3. Changes to the land access regime via the introduction of a consistent restricted land framework; and
  4. Changes to the powers and jurisdiction of the Land Court.

OPT-OUT AGREEMENTS

Under section 45 of MERCPA, landholders now have the option to enter into an opt-out agreement instead of a conduct and compensation agreement. The introduction of opt-out agreements is intended to “streamline the existing negotiation process” and provide greater flexibility in the management of relationships between landholders and resource authority holders, particularly in situations where parties already have an existing relationship.

Requirements of Opt-Out Agreements

Section 9 of the draft Regulations prescribes the requirements for an opt-out agreement. The resource authority holder must have:

  1. given the landholder a copy of the fact sheet[2] for opt-out agreements along with a copy of the Land Access Code;
  2. told the landholder that they are not required to enter into an opt-out agreement and explained that they can ask to negotiate a conduct and compensation agreement; and
  3. acknowledged that the opt-out agreement does not negate their liability to compensate an eligible claimant.

A template opt-out agreement is intended to be made available by the Department of Natural Resources and Mines on its website at some stage in the near future. Both landholders and resource authority holders should be mindful to seek legal advice before using or relying on the template agreement.

Cooling-Off Period

Pursuant to section 45 of MERCPA, there is a cooling-off period which allows both parties to an opt-out agreement to terminate the agreement within 10 business days after a signed copy of the agreement is given to the owner or occupier of the land. The party wishing to terminate the opt-out agreement must provide written notice to the other party.

RECORDING OF AGREEMENTS ON TITLE

Section 92 of MERCPA introduces a requirement for all resource authority holders to notify the Registrar of Titles of the existence of an agreement within 28 days of entry into a conduct and compensation agreement or an opt-out agreement. The existence of these agreements, but not their terms, will be recorded on the property title by the Registrar.

There is also a requirement for resource authority holders to notify the Registrar within 28 days of:

  1. an agreement ending; or
  2. the land subject to the agreement being subdivided in circumstances where the agreement does not apply to a new lot created by the subdivision.

Retrospective Application

Importantly for resource authority holders who are currently a party to existing conduct and compensation agreements, the requirement to notify the Registrar of the existence of conduct and compensation agreements will apply retrospectively. Resource authority holders that are a party to existing conduct and compensation agreements (which were entered into prior to the commencement of MERCPA) will have 6 months from the commencement of section 218 of MERCPA (anticipated to be 27 September 2016) to notify the Registrar of the existence of such agreements.

Notice Requirements

The notices given to the Registrar must include:

  1. the names and contact details of the parties;
  2. the real property description of the land subject to the agreement;
  3. whether the notice relates to a conduct and compensation agreement or an opt-out agreement; and
  4. the day the agreement ends.

For conduct and compensation agreements, section 18(e) of the draft Regulations requires the agreement to include a statement that the resource authority holder is required to notify the Registrar of the existence of the agreement and that the Registrar is required to record the agreement. Under section 83(4) of MERCPA, failure to include this information will result in the conduct and compensation agreement being invalid.

Costs

Resource authority holders will be responsible for the costs associated with the recording on and removal of the existence of the conduct and compensation agreements and opt-out agreements from the title. As the agreements will be recorded in the form of an administrative advice, from 1 July 2016 the fee for registration for each agreement will be $26.00.

RESTRICTED LAND PROVISIONS

MERCPA introduces a consistent restricted land framework for all resource authority holders and provides landholders with greater control over the activities performed on and around their land.

Landholder Consent

Section 70 of MERCPA requires the resource authority holder to obtain the consent of the landholder before any prescribed activities are undertaken on restricted land. The landholder’s consent may be conditional in nature. However, such consent cannot be withdrawn in the period during which the resource authority holder has been granted access. If consent is granted subject to conditions, these conditions are deemed to be conditions of the underlying resource authority.

Prescribed Activities and Restricted Land

A prescribed activity is broadly defined in section 67(a) of MERCPA as an authorised activity for a resource authority that is carried out:

  1. on the surface of the land; or
  2. below the surface of the land if it is likely to cause an impact on the surface.

Specific exclusions are listed in section 67(b) of MERCPA and include:

  1. the installation of an underground pipeline or cable if installation is completed within 30 days after the start of the installation;
  2. the operation, maintenance or decommissioning of an underground pipeline or cable; and
  3. crossing land in order to enter the area of the resource authority if the only entry to the area is through the land and the landholder has either agreed in writing or unreasonably refused the crossing.

Restricted land is defined in section 68 of MERCPA as, for a production resource authority or exploration resource authority:

  1. land within 200 metres of:

    1. a permanent building used for a residence, place of worship, childcare centre, hospital, library or business; or
    2. a school, a prescribed environmentally relevant activity that is aquaculture, intensive animal feedlotting, pig keeping or poultry farming;
  2. land within 50 metres of:

    1. an area used for an artesian well, bore, dam or water storage facility;
    2. a principal stockyard; or
    3. a cemetery or burial place.

For a resource authority other than a production resource authority or exploration resource authority, restricted land means any land within 50 metres of any of the areas/buildings mentioned above. Both landholders and resource authority holders are entitled to apply to the Land Court for an order declaring whether particular land is restricted land and whether a particular activity is a prescribed activity for the purposes of MERCPA.

Application

Whilst the introduction of these provisions essentially grants landholders the power to prohibit resource activities within prescribed distances of their land, importantly for resource authority holders, the changes will only apply to resource authorities applied for and granted after the commencement of section 70 of MERCPA (anticipated to be 27 September 2016).

Powers of the Land Court

In addition to the changes outlined above, MERCPA broadens the powers of the Land Court, particularly in circumstances where parties have been unable to successfully negotiate a conduct and compensation agreement. The Land Court will now have the power to not only determine the compensation payable by a resource authority holder, but also to decide how:

  1. and when a resource authority holder may enter land; and
  2. authorised activities must be carried out.

When reaching decisions on these matters, MERCPA specifically provides that the Land Court may have regard to the behaviour of the parties in the process leading up to the application. The conduct of the parties during negotiations will therefore likely influence the orders which the Court may ultimately make.

The orders which the Land Court can make under section 97 of MERCPA broadly reflect the position under section 537D of the Petroleum and Gas (Production and Safety) Act 2004 (Qld). However, it is worth noting that specific reference is made in MERCPA to orders that a party not engage in particular conduct as well as orders that parties attend a conference or engage in further ADR.

WHERE TO FROM HERE?

This article provides a brief high level overview of some of the key changes which will be introduced on commencement of the remaining provisions of MERCPA. There are, however, a number of other changes that have not been discussed. Further information regarding these additional changes is available in our June 2014 article.

Going forward, resource authority holders should be mindful of the changes being implemented, especially those with retrospective application, and should ensure they implement appropriate measures to comply with the evolving resources legislation.