The Australian Government is currently undertaking a review of the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2009 (OPGGS (Environment) Regulations), which regulates activities beyond State and Territory coastal waters under the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (Cth) (OPGSS Act). As part of the review, the Department of Energy, Resources and Tourism (DRET) has released the Issues Paper Review of the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2009 (Issues Paper), on which interested stakeholders are invited to make written submissions by 28 February 2013.

The review is occurring in conjunction with a broader offshore petroleum and marine environment legislative review that is taking place nationally and internationally, particularly relating to reform in shipping and the protection of the marine environment1. Further, the initiative reflects a response to the growing public attention that petroleum activities are attracting as inherently environmentally risky operations, as demonstrated in the recent Montara and Gulf of Mexico incidents2.

The OPGGS (Environment) Regulations have been in place (under a different name) since 1999 when they were created under the Petroleum (Submerged Lands) Act 1967, and have been amended and added to later on an ad-hoc basis3. Given the present trend of law reform in this area, industry should seize this opportunity to contribute to the process and guide regulatory direction.

Achieving leading practice

The review seeks to ensure that the OPGGS (Environment) Regulations encapsulate leading practice for objective-based regulation, as indicated in the Final Terms of Reference. Objective-based regulation involves a dual role where industry must demonstrate to regulators that the impacts and risks to the environment will be minimised, through the preparation and implementation of an environment plan. Secondly, the regulator must assess and determine whether or not the environment plan is acceptable.

The terms of reference of the review are addressed in each chapter of the Issues Paper and include:

  1. The appropriateness of the current objective(s);
  2. The extent to which industry is encouraged to adopt best practice and to continuously improve its environmental performance;
  3. The effectiveness of reporting arrangements;
  4. The duties and responsibilities of the operator, agent and instrument holder;
  5. The effectiveness and completeness of the Oil Spill Contingency Plan provisions in the OPGGS (Environment) Regulations as a mechanism for requiring adequate preparation for and response to marine pollution incidents from petroleum activities;
  6. The effectiveness and completeness of monitoring provisions to detect impacts of petroleum activities;
  7. The effectiveness of the compliance and enforcement framework, including penalties; and
  8. Other changes to align the OPGGS (Environment) Regulations with Australian Government policy and guidance on regulation.

Issues and options raised

For each term of reference, DRET has raised a range of issues and options on which public comment is sought. However this is not an exhaustive list of potential issues. Stakeholders are encouraged to identify other relevant issues and options.

While there is an extensive range of issues discussed, cumulative environmental impacts is particularly noteworthy. This is raised in the context of the object of the OPGGS (Environment) Regulations which is to ensure activities are carried out in accordance with the principles of ecologically sustainable development or ESD.

The current regime requires environmental impacts and risks to be detailed and evaluated within an environment plan4 and does not specifically make reference to the concept of cumulative impacts. Requiring the evaluation of cumulative impacts and risks under the OPGGS (Environment) Regulations is raised as an option. This could be challenging for operators in Australia and internationally due to the remote locations of offshore petroleum activities and the lack of baseline data on natural environmental conditions. The Issues Paper acknowledges these limitations. 

Under the existing OPGGS (Environment) Regulations there are penalties for significant impacts to the environment, while minor impacts are not accounted for in that they are not required to be reported or addressed. The review is an opportunity for these cumulative impacts to be dealt with under the OPGGS (Environment) Regulations so that standards and criteria for environmental assessment are adequate.

Making a submission

The Australia government is in the process of consolidating and improving its regulatory system to better protect marine environments from the impacts of activities such as offshore oil and gas operations, seismic surveys and greenhouse gas storage.

Now is an opportune time for industry to have input into the reform process that will direct the future of the law in this area. The invitation for public comment on the Issues Paper presents an opportunity to raise constraints in the current legislative framework and detail alternative proposals to address issues and challenges relevant to each business activity.

Submissions must be lodged by 5pm, 28 February 2013. DRET will then consider the submissions and prepare a report containing recommendations for the Commonwealth Government consideration by the second quarter of 2013.