Mining cost caps a risk to cockies and courts

NEW regulations to balance mining and gas development against private property rights threatens to cause perverse outcomes, pushing landholders to lock the gate and head straight to court.

An alliance of Cotton Australia and NSW Farmers, Irrigators and Country Women’s Association (CWA) hit out at the caps on costs to be borne by mining and gas explorers, saying they fall short, leaving landholders potentially thousands of dollars out of pocket.

The group issued a statement “calling out the NSW government” and putting it on notice ahead of a compulsory review of the new regulations, set to kick off in six months.  

“The caps announced by the NSW government are a far cry from the actual costs likely to be incurred,” said NSW Farmers president Derek Schoen.

NSW CWA president Annette Turner said “unfortunately, (the regulation) fails to live up to the promise of a balance between landholders and resource companies”.

But a Department of Resources spokesman said the new regime included unprecedented protections for landholders, as well measures to deal with a bugbear of mining companies - which often cite “lawfare” and “activists” as the cause of land access disputes.

In October 2015, NSW Resources Minister Anthony Roberts guided a new land access regime through parliament, which included reforms to pre-assess land before it was released for exploration and kicked off a spate of buybacks of petroleum tenements across the state, as well as a new land access regime. 

“The reforms delivered in the Land Access Framework for NSW are ahead of any other jurisdiction in ensuring a fairer process for accessing someone’s land for exploration purposes,” the spokesman said.

“This framework is about getting the incentives right to ensure all parties negotiate access arrangements in good faith. For the first time this is required under legislation.

“Should a negotiation escalate to arbitration or the Land and Environment Court, the behaviour of all parties can be taken into account when considering costs and if an arbitrator considers that a landholder has caused or increased costs by unreasonable conduct, the arbitrator or court can consider this in allocating costs. This provides an incentive for efficient negotiations.”

In reference to the $2500 cap on landholders costs, the spokesman said stakeholder groups were offered consultation with Land and Water commissioner Jock Laurie.

“(It) was made clear that if no mutually agreed outcome was reached, that the legislation would commence along with the cost caps that were presented to them.”

But NSW Farmers mining and coal seam gas spokesman Tim Duddy said the lack of resolution in the consultation was a “good example of how the position of the Land and Water Commissioner isn’t working”.

“This position has been in place for years, and these matters are still not being resolved in a space that farmers are happy with.”

Mr Duddy, “Rossmar Park”, Caroona, was a leader of the community fight against the Caroona mine, which he said mobilised more than $1 million against the Liverpool Plains coal project. NSW government eventually bought Caroona from BHP Billiiton in August and the successful campaign demonstrated “people aren’t prepared to wear it anymore”.

Despite the new cost provisions for expert advice (capped at $2500), landholders can claim significant improvements to their land will be impacted by exploration activity, which can force negotiations in the legal system. Significant improvements, such as dams, fences, roads, garden, cropping or improved pastures are off limits to explorers – as long as landholders can demonstrate they cannot co-exist with exploration activity.

Private legal practitioner Mary Lou Potts represented landholders in a landmark case against Hume Coal in the Southern Highlands, which set a precedent for protection of significant improvements in the Land and Environment Court. She said refusing access to such assets and escalating the matter into the legal system – where law requires landholders costs are covered – was a viable option.

But landholders and government should be wary of the impacts to individuals and to the crowded court system. ​