Following the completion of the public submission phase of the Leading Practice Mining Acts Review in March 2017, the South Australian Government’s Review Team has now released its first response to the submissions in the form of 20 ‘Policy Directions’ documents (Policy Directions).The Policy Directions summarise the key issues that the Review Team identified from the public submissions and give a broad outline of the future policy direction being considered by the Review Team to address those issues. While there is little detail available at this stage, the Policy Directions do point to several specific recommendations that the Resources Industry should carefully consider.
The Review Team is currently seeking feedback on the recommendations and the broader proposed policy directions in parallel with its preparation of draft amendments for consideration by Parliament.
The South Australian Government received more than 130 written submissions, 700 emails and feedback from more than 100 internal and external meetings during the principal consultation phase of the Leading Practice Mining Acts Review.
The Government’s Review Team has now published its first response to the issues raised during consultation.
The response is in the form of 20 ‘Policy Directions’ documents which each address a key issue identified by the Response Team from the submissions, together with opportunities for improvement of the current regime.
While a detailed package of recommendations is still to be prepared for Parliament, the Policy Directions documents contain a number of specific recommendations that the Resources Industry should carefully consider.
These recommendations are discussed in this alert.
On the whole, we have been impressed with the approach taken by the Review Team throughout the consultation process and with its efforts to develop proposals that achieve a fair balance between what might in some cases be competing aims of the Review. The Policy Directions suggest that a substantial number of positive changes are likely to be proposed.
The Review Team recognises that while ‘exempt land’ has always signified land that could be accessed subject to waiver of the benefit of the exemption, the term is misleading and results in confusion as to what rights of access are available for exploration and/or mining. Consequently, the Review Team will be recommending that the term is changed to ‘restricted access land’.
In our view, this term much more appropriately reflects the legal position in respect of that land, and as such we strongly support the proposed change.
In addition to the change in terminology, the Review Team has indicated that it is considering recommending an increase to the protective boundaries for advanced operations around residences by up to 50-100%, and providing “more appropriate” boundaries for low impact survey operations.
We support an update to the buffer distances and clear differentiation between the distances that apply with respect to different infrastructure as well as different proposed activities. That being said, any recommended changes to the exempt land provisions need to be carefully formulated so as to reflect realistic risks and impacts. We encourage the industry to engage with the Review Team to identify relevant infrastructure and appropriate buffer distances.
Notices of Entry
The Review Team does not propose to bring forward the point at which mining companies are required by legislation to make contact with landowners.
However, the Review Team is considering improvements to the notification process for notices of entry, commencement of negotiations to seek ‘waivers of exemption’ and proposed use of ‘declared equipment’, including the release of clearer forms for notices that are linked to activity type (eg. low impact operations, advanced exploration, mining operations and ancillary operations) instead of tenure type.
Landowner advice and assistance
The Review Team will be recommending that the cover that mining operators are required to provide to landowners for the reasonable costs of obtaining legal assistance with exempt land matters be initially increased five times from $500 to $2,500, then indexed annually via the Mining Regulations.
Additionally, the Review Team is seeking assistance to identify how to establish and resource an independent advice and/or advocacy service for landowners (such as an independent helpline and advocacy service with officers who could, for example, be empowered to directly engage with the Department to advocate for landowners, and seek to resolve or mediate contentious matters including court proceedings).
In addition to new compliance and enforcement programs that will soon be administratively introduced by the Mineral Resources Division, the Review Team is proposing what it describes as “incremental changes” to evidentiary and offence provisions in the Mining Act to facilitate compliance action, together with new emergency powers.
Further, it is proposed that compliance directions, and notification about actions taken in response to compliance directions, be placed on the Register.
Disclosure and Transparency
The Review Team is considering recommending new disclosure provisions to increase the disclosure of records and samples and give clearer powers around requests for information such as expert reports.
That being said, the Policy Directions acknowledge that “Companies must have certainty that market sensitive information will not be disclosed” and as such these provisions should only provide for disclosure to the public where the release of information would not breach a law, and the information does not relate to “an incomplete proposal, negotiation, suppositional or indefinite matter, internal management information or a trade secret”.
The Department is considering replacement of the subsequent exploration licence regime with a renewal regime where land must be progressively relinquished at each 2 year renewal interval after an initial 2 x 5 year term. The same licence number will be retained throughout.
A ‘first sale’ approach to the calculation of royalties is proposed, with royalties levied on the relevant ‘arms-length’ contract price, or calculated using market prices or price determinations in the absence of an arms-length transaction (or where the minerals are transformed).
Next Steps and further information
The Review Team is now developing recommended legislative amendments and is calling for feedback and further suggestions regarding the Policy Directions.
This Alert is intended as general information only. It does not purport to be comprehensive advice or legal advice. Readers must seek professional advice before acting in relation to these matters.