Brett Cohen, Clayton Utz - Northern Territory Mining Regulations
 

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Brett Cohen, Clayton Utz delivered the presentation at the 2013 Mining the Territory Conference. ...

Brett Cohen, Clayton Utz delivered the presentation at the 2013 Mining the Territory Conference.

Mining the Territory Conference is part of the Northern Territory Resources Week. It provides the perfect platform for stakeholders in the NT mining industry to hear the latest information on this booming region.

For more information about the event, please visit: http://www.miningnt.com.au/miningnt2013conference

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Brett Cohen, Clayton Utz - Northern Territory Mining Regulations Presentation Transcript

  • 1. Northern Territory Mining Regulations Brett Cohen Partner - Clayton Utz Mining the Territory Conference Darwin, 11 September 2013 © Clayton Utz
  • 2. The mining industry • The Territory's largest • Over 20% of GSP • $2.5b in revenue • Employs around 5000 people • However, vast areas remain under-explored, and quality projects remain undeveloped • A climate of constrained access to capital - Vital that regulations are proportionate and cost-effective
  • 3. Mining and exploration in the Territory • Snapshot of the NT regulatory framework • The NT Mining Management Act (MMA) • Wholesale recent changes to the MMA • Environmental securities • New levy on mining rehabilitation securities
  • 4. The NT regulatory framework • Combination of NT and Commonwealth laws regulate mining activities • Fraser Institute survey 2012 - NT the top ranked jurisdiction in Australia for ease of doing business in minerals exploration and mining investment • Maintaining the right regulation balance between facilitating business activity, and community benefits
  • 5. Mining activities - primary laws Titles and tenure Mineral Titles Act (NT)  Regulates grant and administration of tenure for mining activities  Titles and authorities for exploration, mining and associated infrastructure  Native Title Act (Cth) and Aboriginal Land Rights (NT) Act (Cth) also relevant to grants of tenure Conducting mining activities Mining Management Act (NT)  Regulates safety, health and environmental aspects of mining activities  Authorisations required for mining activities  Management and monitoring of mining activities; environmental rehabilitation securities  Significantly amended and strengthened in recent years
  • 6. Mining activities - (some) other major laws Environmental regulation Waste Management and Pollution Control Act (NT) Environmental Offences and Penalties Act (NT) Environmental assessments Environmental Assessment Act (NT) Environment Protection and Biodiversity Conservation Act (Cth) Native title and Aboriginal land rights Native Title Act (Cth) Aboriginal Land Rights (NT) Act (Cth) Heritage and sacred sites Northern Territory Aboriginal Sacred Sites Act (NT) Heritage Act (NT) Dangerous goods Dangerous Goods Act (NT) Transport of Dangerous Goods by Road and Rail (National Uniform Legislation) Act (NT) Health and safety Work Health and Safety (National Uniform Legislation) Act (NT) Water Mineral Titles Act (NT) Water Act (NT) Royalties Mineral Royalty Act (NT) Uranium Royalty (Northern Territory) Act (Cth)
  • 7. Primary agencies and regulators NT Department of Mines and Energy Mineral titles Mining Environmental Compliance Division NT Geological Survey Native Title and Aboriginal Land Rights Unit NT Environment Protection Authority Environmental assessments Environmental approvals and licences Cth Department of the Environment, Water, Heritage, and the Arts Commonwealth environmental assessments NT Worksafe Occupational health and safety Dangerous goods regulation NT Department of Lands, Planning and the Environment Heritage administration Department of Land Resource Management Pastoral land administration
  • 8. Part 4 MMA - Conducting mining activities To conduct "mining activities" in the NT, require the following under the MMA: • valid title ("mining interest") under Mineral Titles Act (Part 4, Div 1) • an Authorisation under MMA (Part 4, Div 2) • submit Mining Management Plan under MMA (Part 4, Div 3) • lodge security under MMA (Part 4, Div 4)
  • 9. Part 4 Div 2 MMA - Authorisation of mining activities "mining activities" defined in s.4 MMA: • exploration for minerals • mining for minerals • processing of minerals, tailings, waste • decommissioning or rehabilitating a mining site • handling, transport and storage of minerals, contaminants, waste • construction, operation, maintenance and removal of plant and buildings • construction and maintenance of mining-related infrastructure • operations for care and maintenance of a mining site
  • 10. When does exploration require an Authorisation? Under s.35 MMA, only exploration involving "substantial disturbance" of a mining site requires an Authorisation, that includes: • land clearing; earthworks (e.g. cutting, filling, excavating, or trenching) • above-ground works (e.g. roads, buildings, bridges, railways, airstrips, conveyors, pipelines, telephone lines or powerlines) • below-ground works (e.g. tunnels, wells, pipelines, conduits, cables) • waterworks (e.g. dams, canals, drainage or alteration of water courses) • extracting resources from the land • stockpiling ore, overburden, waste materials or by-products • establishing an exploration/workers' camp • blasting • activity that is likely to have a significant impact on flora or fauna
  • 11. When does exploration not require an Authorisation? According to DME guidance, no "substantial disturbance" for: • remote sensing, including geophysical surveying (although active remote sensing and seismic techniques in water do constitute a "substantial disturbance") • non-intrusive actions such as fossicking, rock chipping and soil sampling by non-mechanical means (to assess land's potential for future exploration - s.17 Mineral Titles Act)
  • 12. Part 4 Div 3 MMA - Mining Management Plan Under s.40 MMA, a Mining Management Plan must include the following: • details of the mining interest (title) held relating to the mining activities • details of the ownership of the mining interest • description of the mining activities the Authorisation is required for • organisational structure details for carrying out the mining activities • details of the relevant management system for the mining site • plans of proposed and current mine workings and infrastructure • plan and costing of closure activities for mining site • other details and plans as may be required by the Minister
  • 13. Part 4 Div 4 MMA - Environmental rehabilitation securities Operator is responsible for rectifying environmental harm arising from mining activities, and for rehabilitation of affected area Under s.43 MMA, a security (in the form of cash or bank guarantee) required in relation to an Authorisation secures any of the following: • operator's obligation to comply with MMA or an Authorisation • payment of costs and expenses to prevent, minimise or rectify environmental harm on a mining site or resulting from mining activities • payment of costs and expenses to complete rehabilitation of a mining site Security is released once criteria specified in the approved closure plan have been met, upon proof that rehabilitation is adequate
  • 14. Calculation of environmental securities • Costing of closure activities required in MMP (s.40 MMA) • Minister determines level of security by balancing protecting the community from closure liabilities and optimising benefits to the community from proposed project • Default expectation is 100% of security calculated for rehabilitation. Calculation based on actual cost of rehabilitation commensurate with size, environmental risk and expected project life • Operator completes self-assessment, by reference to security calculation form that indicates costs for different disturbances • Additional security amount then added to fund contingencies arising from failure of rehabilitation and cover post closure costs (e.g. monitoring, maintenance, site visits, remediation etc) - currently 15%
  • 15. Recent changes to MMA - effective 1 July 2012 Result of comprehensive review, implemented wholesale changes to the MMA: • broadening of environmental offence provisions, and increased penalties • wider notification requirements for all environmental incidents - previously only "serious accident or critical incident" • power for CEO to direct operators to investigate and report on environmental incidents, and CEO's discretion to publish report • annual report on environmental performance for minerals mining • clarification of activities requiring an Authorisation • changes to process for granting and varying Authorisations • Minister may require provision of social and economic benefits to communities affected by mining activities
  • 16. Recent changes to MMA - effective 1 October 2013 Further changes to MMA: • non-refundable annual 1% levy on securities - establishment of Mining Rehabilitation Fund • removal of mandatory annual report on environmental performance introduced in 2012 - now affected sites determined by Minister • extended period for commencing proceedings for offences under the MMA - 3 years up from 12 months • DME ability to recover costs for investigations and successful prosecutions • may prescribe minimum security amount by Regulation • clarification (widening?) of power to make Regulations to impose fees and charges
  • 17. Levy on mining rehabilitation securities • Non-refundable 1% levy on securities, calculated by reference to total calculated rehabilitation cost • Decrease of 10% in total security amount payable by operators (effectively taken from 15% contingency fee applied to securities) • Primary objective to generate funds to address environmental issues on legacy mine sites - establishment of Mining Rehabilitation Fund. 33% of funds generated from levy paid into Fund • 90% of current authorised operators who lodge securities will pay annual levy of $2,000 or less per site, and 74% will pay a levy of $500 or less per site. Around 5% will pay in excess of $10,000 per site
  • 18. Levy - DME worked examples (cash securities) Smaller operator Larger operator Current security $10,000 Apply 10% discount $9,000 Cash refunded to operator $1,000 1% levy payable $90 Current security $5,000,000 Apply 10% discount $4,500,000 Cash refunded to operator $500,000 1% levy payable $45,000
  • 19. Contact details Brett Cohen Partner - Clayton Utz Corporate - Energy & Resources bcohen@claytonutz.com (08) 9426 8462 0434 154 196
  • 20. www.claytonutz.com