The Queensland Government's water reform legislation commenced on 6 December 2016. Mining lease and mineral development licence holders need to ensure they are meeting their new obligations in respect of ground water.

The recently commenced Water Reform and Other Legislation Amendment Act 2014 (as amended by the Environmental Protection (Underground Water Management) and Other Legislation Amendment Act 2016 and the Water Legislation Amendment Act 2016) changes the rights and obligations of mining lease (ML) and mineral development licence (MDL) holders when dealing with underground water.

These changes have a significant impact on new projects as well as some existing projects and it is important that ML and MDL holders consider their situations to assess the impact of these changes on a project by project basis.

An overview of the changes to Queensland water laws

Before the Water Reform Acts commenced, the Mineral Resources Act 1989 (MRA) expressly indicated that, where any Act provided that water may be diverted or appropriated only under authority granted under that Act, the holder of a ML could not divert or appropriate water unless the holder held that authority (previous section 235(3) of the MRA).

As a result of this provision and the previous section 808 of the Water Act 2000, ML holders were generally required to obtain a water licence to take or interfere with groundwater.

The Water Reform Acts (which began operation on 6 December 2016) modify the MRA and the Water Act to bring the rights and obligations of ML and MDL holders in respect of "associated water" in line with that existing for petroleum tenure holders under the petroleum legislation.

The changes establish a new section 334ZP of the MRA containing a right for the holder of a MDL or ML to take or interfere with underground water in the area of the licence or lease where the taking or interference happens during the course of, or results from, the holder's authorised activities (associated water).

MDL and ML holders will be required to measure and report on the volume of associated water taken and also advise the chief executive of the exercise of the holder's underground water rights immediately after the holder starts exercising those rights. For MDLs and MLs in existence as at 6 December 2016, holders will have until 6 March 2017 to advise the chief executive of the exercise of the holder's underground water rights.

The exercise of these underground water rights is also subject to the holder complying with the underground water obligations in the amended Chapter 3 of the Water Act (which previously only applied to petroleum tenure holders, and has been amended to now also capture mining tenure holders).

The obligations under the amended Chapter 3 of the Water Act centre around:

  • reporting;
  • Baseline Assessments; and
  • make good obligations for water bores.

How will this affect mining tenure holders?

The amendments will impact mining tenure holders differently depending upon whether they:

  • hold an existing water licence;
  • have a granted Environmental Authority (EA) (or have commenced the approval process for an EA application or amendment application), or were a "notified coordinated project", as at 6 December 2016, but did not have a water licence at that date; or
  • have a new project that has not commenced the EA approval process.

Holder of an existing water licence

There are certain exemptions from the Chapter 3 Water Act requirements for those ML and MDL holders who hold a water licence.

Projects with an EA (or in EA approval process) or that are a "notified coordinated project" that do not hold a water licence

These mining tenure holders (or applicants) that do not have a water licence will be required to obtain an associated water licence to deal with underground water. This includes anyone who, prior to the commencement of Water Reform Act amendments:

  • had an EA granted; or
  • made an application for an EA (or an amendment to an EA) but that application was not decided; or
  • was a "notified coordinated project" but no EA was granted or applied for; and

the holder would have been required to have a water licence to take or interfere with the underground water.

The associated water licence has its own application process and specific criteria. Importantly, a public notification process will be undertaken in relation to the licence where submissions may be made and, ultimately, appeals to the Land Court can be instituted.

New projects for which EA approval process has not been commenced

Those who have not commenced the EA approval process will not be required to obtain an AWL and, instead, can rely on the right under the new 334ZP of the MRA to take or interfere with underground water subject to compliance with the relevant underground water obligations in Chapter 3 of the Water Act. However, as is noted below, there have been amendments to the EA application requirements to include additional information relating to underground water rights.

Other changes in Water Reform Acts

The Water Reform Acts also contain amendments to the Environmental Protection Act 1994 to (among other matters) include additional application requirements for site-specific environmental authority applications (and amendment applications) involving the exercise of underground water rights for resource projects or resource activities that include, or for which the relevant tenure is, an MDL, ML or petroleum lease.

Importantly for petroleum tenure holders, the Water Reform Acts also remove the general right for petroleum tenure holders to take or interfere with underground water in the area of the tenure for use in the carrying out of another authorised activity for the tenure. However, there is a transitional period of two years (or five years if the relevant petroleum tenure is located in the Surat Cumulative Management Area) during which this right continues to apply. After this period, petroleum tenure holders will require a water licence or water permit to exercise this right.