Resource companies must compensate land owners and
occupiers for the effect of activities carried out on their land.
But negotiating a Conduct and Compensation Agreement that satisfies
both the resource company and the owner is not always
When negotiations stall, what are the dispute resolution
options available to parties and which is best?
Resource companies generally cannot enter private land to
undertake advanced activities under a petroleum authority unless
they have first negotiated a Conduct and Compensation Agreement
(CCA) with each owner and occupier of the land.
The statutory negotiation process commences with the resource
company issuing a "Notice of Intention to Negotiate" to
each owner and occupier of the land.
Once this notice is issued, the negotiation period begins and
runs for an initial minimum period of 20 business days. During this
period, the resource company and each owner and occupier must use
"all reasonable endeavours" to negotiate a CCA.
If the initial negotiation period expires without a CCA being
concluded, either party may issue an Election Notice:
asking an Authorised Officer of the Department of Natural
Resources and Mines to call a conference to assist the parties
negotiate a CCA; or
calling upon the other party to agree to an alternative dispute
resolution (ADR) process to negotiate a CCA.
If an Election Notice is issued seeking a conference, the
Authorised Officer will issue a notice to the parties asking them
to attend the conference. The Authorised Officer may also ask any
other person whose interests may be affected to attend. During the
conference, the Authorised Officer will assist the parties to reach
"an early and inexpensive" settlement of the dispute.
The lack of legal involvement means conferences are usually less
formal than ADR processes which may promote an agreement being
reached between the parties.
Cost is also an advantage of conferencing. Unlike ADR processes,
parties are not charged for having an Authorised Officer conduct
the conference nor are legal representatives permitted to attend
(unless the parties agree to that representation).
Although a variety of ADR processes can be used to negotiate a
CCA, mediation is the most common process adopted in land access
and compensation matters.
A party may choose mediation over conferencing on account of it
being more flexible. Parties can choose and agree upon the
mediation procedures and processes, such as the format of the
mediation and the exchange of documents and submissions.
Parties can also nominate a mediator who has legal experience
and expertise in relation to land access and compensation. This is
useful in disputes involving technical legal issues.
However, mediation does have potential drawbacks. The
unavailability of the mediator could cause delays and mediation is
likely to be more formal than a conference.
WHICH PROCESS TO CHOOSE?
The circumstances of each matter will dictate whether a
conference or ADR process is the preferred option.
Conferencing may be the better option where the parties have a
strong working relationship and they wish to mutually discuss
matters of concern directly with one another in a relatively
informal setting. Conferencing allows the parties to take a lead
role in the negotiations with assistance from the Authorised
Mediation may be preferable if the legal issues are particularly
complex and the parties would benefit from legal representation and
an impartial expert. Mediation may also be preferable where the
relationship of the parties is such that an agreement is more
likely to be reached in a formal and structured setting.
Ultimately, the decision on which option is best will be made on
a case-by-case basis.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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