Queensland ‘Greentape Reduction’ legislation is now in force

Legislative changes that underpin the Queensland Government’s Greentape Reduction Project (Project) are now in force. The Project has amended several pieces of legislation that affect the Queensland energy industry including the Environmental Protection Act 1994 (Qld) (EPA Act) and the Petroleum and Gas (Production and Safety) Act 2004 (Qld) (the P&G Act).

The Environmental Protection (Greentape Reduction) and Other Legislation Amendment Act 2012 (Qld) (Greentape Reduction Act) is a key component of the Greentape Reduction Project.

The Greentape Reduction Act amends to the EPA Act aiming to streamline, integrate and coordinate regulatory requirements under the EPA Act without compromising environmental outcomes.

In particular, the Greentape Reduction Act:

  • repeals Chapters 4, 5 and 5A of the EPA,
  • introduces a new Chapter 5, which establishes one integrated and modular approval process for all environmentally relevant activities (ERAs),
  • introduces a more proportionate licensing framework for Environmental Authorities (EAs), including standard applications for activities that have well understood and manageable environmental risks,
  • separates environmental operating conditions from planning approvals (development permits). For example, a Development Approval (DA) will run with the land to authorise land use, and an EA will condition the activities carried out on the land and must be transferred to any new operator,
  • reduces the number of ERAs requiring development approval for a material change of use (‘concurrence ERAs’), and
  • introduces amalgamated corporate authorities (ACA) that allow operators to hold one EA for multiple activities.

New terminology

Under the new regime:

  • former ‘Chapter 4 activities’ (non-mining and petroleum) activities are now ‘prescribed ERAs’,
  • former Chapter 5 and 5A (mining and petroleum activities) are now ‘resource activities’,
  • former ‘codes of environmental compliance’ are now ‘eligibility criteria’ for a standard application,
  • former ‘Level 2 code compliant activity’ is now a ‘standard application’,
  • former ‘Level 2 non-code compliant activity’ is now a ‘variation application’, and
  • former ‘Level 1 activity’ is now a ‘site specific application’.

Application process for an EA

The Greentape Reduction Act has changed the application process for an EA so that it is the same for all relevant activities. Both ‘prescribed ERAs’ and ‘resource activities’ will require an EA. Previously, Chapter 4 activities required a development permit and a registration certificate.

The Greentape Reduction Act introduces the following three application processes for an EA authorising an ERA:

  • Standard applications. These are for eligible ERAs that meet standard conditions. Eligible ERAs are activities that have set eligibility criteria and are able to comply with the criteria. Standard applications for eligible ERAs will not require further assessment.
  • Eligibility criteria and standard conditions are in place for mining and petroleum activities. The mining standard conditions are currently under review.
  • Variation applications. These are for eligible ERAs that involve amendment of one or more standard conditions.
  • Site-specific applications. These are for all other applications, and relate to what was previously known as ‘level 1 activities’.

The application process is streamlined and should operate more efficiently than the previous process, as documentation submitted as part of an EIS process will automatically form part of the application documents. Furthermore, under the new application process:

  • submission of an Environmental Management Plan is no longer required, as these requirements have been merged into the application process
  • small mining projects (previously ‘level 2 projects’) are no longer required to submit a Plan of Operations, and
  • an operator who wishes to undertake any new ERAs must comply with the new EA application process, regardless of whether the activity relates to mining, petroleum or other types of development.

Suitable operators

The new provisions of the EPA require all holders of EAs to be registered as suitable operators. If a person held an EA or registration certificate for an ERA prior to the commencement of the Greentape Reduction Act they will have been automatically added to the new suitable operator register administered by the Department of Environment and Heritage Protection. The need for registration certificates has been abolished under the new regime. Registered suitable operators do not need to be re-assessed each time they apply for an EA. Prior to the transfer of an EA, a transferee that is not yet a suitable operator must apply to be registered.

EA amendments, transfers and financial assurance

EAs now transfer automatically with tenure under resources legislation, such as the Petroleum and Gas (Production and Safety) Act 2004 (Qld) (P&G Act) or the Mineral Resources Act 1989 (Qld) (MRA), provided that the transferee is on the suitable operator register. The EA amendment process has also been streamlined.

Guidelines for financial assurances under the EPA have been introduced. These Guidelines outline when financial assurance will be required for resource activities and some prescribed ERAs, the amount and form of the financial assurance and how the requirement can be changed, replenished and discharged.

Amalgamated corporate authorities

Operators will have the option of obtaining an ACA for all of its Queensland activities, or maintain separate authorities for each site. ACAs will retain all site-based fees and conditions. ACAs simplify and reduce annual reporting requirements and administrative arrangements for holders of multiple authorities.

Conclusion

Although it is too early to determine whether the Greentape Reduction Project will ultimately achieve its aim to reduce greentape in Queensland, DEHP are focussed on the initiative and continuing their preparation of further eligibility criteria and model conditions for other ERAs.

Operators should ensure they understand how the Greentape Reduction Act impacts their existing approvals together with any potential new ventures and take the opportunity to make submissions on any relevant draft eligibility criteria and standard conditions before they are finalised by DEHP.

2.  Petroleum and Gas (Production and Safety) Act amendments – new Dealings chapter

On 31 March 2013, the amendments to Chapter 5 Part 10 (Dealings) of the P&G Act introduced under the Mines Legislation (Streamlining) Amendment Act 2012 came into effect. These amendments form part of the Streamlining Approvals Project and aim to reduce the time taken to process resources permit applications without compromising the rigour of the assessment process.

Change of holder name must be notified

One of the main substantive changes to the new dealings chapter is that a change to the petroleum authority holder’s name is now considered a ‘non-assessable transfer’ even if the holder continues to be the same person after the change.1 As a result, notice of any change in the name of a petroleum authority holder must now be given to the chief executive of the Department of Natural Resources and Mines.

List of dealings is now an exhaustive list

The P&G Act now clarifies that any transaction not defined as a dealing is not considered a dealing with a petroleum authority.2 This amendment removes the doubt which had previously surrounded this issue.

New terminology – ‘non-assessable transfers’ and ‘assessable transfers’

The amendments introduce a distinction between non-assessable transfers and assessable transfers.

Non-assessable transfers

Non-assessable transfers include:

  • a transfer of shares between current holders,
  • a transfer of a mortgage, and
  • a transfer of a sublease.

Non-assessable transfers do not require assessment before being registered which should significantly assist the timeliness for these types of dealings being registered.

Non-assessable dealings

While not language used in the legislation, the prescribed form for the registration of a mortgage or sublease or release of a mortgage currently describes these types of dealings as ‘non-assessable dealings’.  The Queensland Department of Natural Resources and Mines has advised that, in practice, these dealings will not be assessed by the Department prior to registration as long as the prescribed form and required consents are submitted appropriately.

Assessable transfers

Assessable transfers are defined as any transfer which is not listed as a non-assessable transfer. In practice this includes a transfer of a petroleum authority or tenure or a share of a petroleum authority or tenure.

Assessable transfers must be approved by the Minister before they can be registered.

Instrument of transfer no longer required to be lodged

Prior to the amendments, an application for approval of a transfer required the instrument for the dealing to be filed with the application. This requirement has now been removed, and replaced with the requirement that a written consent to the transfer by the proposed transferee be filed when making an application for approval of an assessable transfer.3 Previously parties had become accustomed to executing a simple transfer document in addition to any long-form sale and purchase agreement which may contain commercially sensitive information so that the more simple transfer document could be lodged with the Department as the ‘instrument of dealing’. This practice will no longer be needed.

Indicative approval for transfers

There is a new fee and approved form to be submitted with an application for an indicative approval, and the Minister must make a decision regarding the application and give the Applicant notice of that decision.4 Previously, a request for indicative approval could be made in any way the Minister considered appropriate and the Minister was not explicitly required to respond to such a request.5 Consequently, there is now greater certainty for parties applying for indicative approval of a transfer.

Conclusion

The revised form of Chapter 5 Part 10 (Dealings) is not immediately user-friendly and, for the time being, appears to have caused some confusion for registrations during the transitional phase. However, once the new chapter becomes better understood, the distinction between assessable transfers and non-assessable transfers should assist to expedite registrations of dealings.

3. Land, Water and Other Legislation Amendment Bill 2013 (Qld) – water rights reforms

The Land, Water and Other Legislation Amendment Act 2013 (Qld) (Amending Act), which commenced on 14 May 2013, amends the Petroleum and Gas (Production and Safety) Act 2004 (Qld) (P&G Act).

The Amending Act is likely to give coal seam gas and petroleum project proponents in Queensland more options when dealing with by-product water from their operations. This article considers the key changes to the P&G Act made by the Amending Act.

Use of ‘associated water’

The P&G Act permits the taking of underground water produced as a by-product of activity under a petroleum tenement (referred to as ‘Associated Water’).

Prior to the amendments taking effect, the P&G Act imposed a number of conditions on the use of ‘Associated Water’ by petroleum tenement holders.

For example, a water licence was not generally required to use ‘Associated Water’:

  • for an activity authorised by the petroleum tenement, or
  • to provide to a landholder whose property overlapped the petroleum tenement, for domestic use.

Where a petroleum tenement holder consented to supply ‘Associated Water’ to a person for any other purpose, they were required to first obtain a water licence.

As a consequence of the Amending Act, ‘Associated Water’ can now be supplied to other users without the need for the petroleum tenement holder to obtain a water licence.

Conversion of petroleum wells

Under the P&G Act, only water supply bores and water observation bores could be transferred to a landholder. Wells are required to be decommissioned and converted to a water supply bore or a water observation bore before being transferred.

The Amending Act clarifies and addresses a number of issues associated with the conversion of wells, including who can undertake the conversion and safety and environmental concerns arising as a consequence of the conversion.

What impact are these changes likely to have?

The amendments are likely to reduce the administrative burden on petroleum tenement holders. Equally, the amendments should assist petroleum tenement holders in managing access to water and transfer of decommissioned wells to landholders.