Key Points:

Stakeholders have until 21 July to comment on the proposed Mining SEPP amendment.

The NSW Government has released a draft amendment to its State mining policy which would remove the requirement to make the significance of a mineral resource the "principal consideration" under that policy in the determination of an application for planning approval for mining.

What is the proposed change?

The proposed amendment would remove clause 12AA of State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007 (Mining SEPP), which deals with the significance of the resource in the assessment of such applications.

Clause 12AA was added to the Mining SEPP in November 2013, in order to require expressly that the consent authority consider the relative significance of the resource and the economic benefits of developing the resource, both to the State and the region in which the development is proposed to be carried out. It also provides that the significance of the resource is to be the consent authority's "principal consideration" under Part 3 of the Mining SEPP, where Part 3 deals with a range of considerations which are relevant for mining projects.

Why is it being proposed?

Clause 12AA provides useful guidance on the way in which the significance of a resource is to be considered when assessing a proposal for mining that resource. However, the Government now proposes to remove that clause, referring to "community and stakeholder concern that the social and environmental impacts of a proposal are not being adequately considered or given appropriate weighting".

The Government has said that the removal of clause 12AA would "build community confidence in the rigour of the assessment process" and provide "a balanced framework for decision makers to assess the likely impacts of mining developments".

What effect would it have?

The Environmental Planning and Assessment Act 1979 makes it clear that economic and social factors as well as environmental factors must be taken into account in assessing an application for planning approval, and the removal of clause 12AA will not change that.

It is also important to keep in mind that the "principal consideration" requirement in clause 12AA applies only to the various considerations in Part 3 of the Mining SEPP, and it does not make the significance of a resource the "principal consideration" of all considerations under the Act.

Consequently, even if the proposed amendment is made, a consent authority will need to consider the significance of the resource, and the economic and social effects of the proposal to extract it, when assessing a development application for that proposal.

As we said recently, the Government is currently preparing economic guidelines for the assessment of mining projects, as part of its new Integrated Mining Policy. We anticipate that these will provide some guidance for proponents, consent authorities and other stakeholders in assessing mining projects.

What's next?

Stakeholders have until 21 July to comment on the proposed Mining SEPP amendment.

The Government is currently reviewing the whole of the Mining SEPP, and expects to hold further discussions about this later this year.