Most Read Contributor in Australia, September 2016
Recent news of oil and gas company Buru Energy's plans for a
pilot exploration fracking program in the Kimberley region of
Western Australia is a timely reminder for all rural landowners of
the ability for those resource companies to conduct exploration and
production on private land.
It is estimated that there will be 40,000 Coal Seam Gas
(CSG) wells in Australia within the next 10
Many landowners remain unaware that the Queensland Government
can issue exploration or production (extraction) tenements to a
resource company over land that is privately owned, subject only to
an Environmental Authority (EA). Landowners then
have no authority to deny access to their land.
It can be quite stressful for landowners and all persons and
businesses that occupy land who may be unfamiliar with their
obligations to enter into negotiations with large resource
companies. The process from when the first notice to the landowner
is given and when activity on the land may commence is over quickly
and can occur within the space of two months.
To conduct preliminary activities which have little impact on
the land such as site scouting, a resource company need only give
10 days notice of entry to occupiers and landowners.
Advanced activities, which have significant impact on the land
can only commence after a Conduct and Compensation Agreement
(CCA) is in place. The CCA is the resulting
document from negotiations with the resource company about how the
activities will be conducted and what compensation the occupiers
Compensation can be non-monetary but is usually for diminution
of surface area, reduction in value, reduction in land use and
potential improvements, damages, legal costs, costs of valuations,
and other loss.1 It is also important to consider long
term plans and identify areas that might need protecting given
farming practice. Both parties should seek advice about
compensation that can be claimed and it is vital not to leave any
information out when negotiating. The more information a landowner
can obtain about the proposed activities of the resource company,
the greater the compensation to be argued for. Those who can make a
claim for compensation include not only the landowner but also
rural businesses who occupy the land.
In Queensland, the mandatory negotiation process for agreeing on
a CCA is set out by the Petroleum and Gas (Production and
Safety) Act 2004 (Qld).2 A resource company wanting
to conduct advanced activities on private land must issue a Notice
of Intention to Negotiate to each occupier. If after 20 days no CCA
has been agreed to, then parties must either engage in alternative
dispute resolution (ADR) or a formal conference
with a Department officer from the Department of Employment,
Economic Development and Innovation (the
Department). The ADR process can be costly but there are
advantages and disadvantages for both options. If 20 days after
commencing the ADR there is still no CCA, then a party can apply to
the Land Court for final determination. Importantly, once the
matter has reached the Land Court, a resource company can commence
advanced activities while the CCA is still
Once the mining activities have commenced on your land and a CCA
is in place it is important that landowners familiarise themselves
with the EA which would have been issued by the Department. This
will say what activities the company is authorised to engage in.
Similarly, the company must comply with the Land Access Code which
was released by the Department in 2010. The Land Access Code
provides best practice guidelines as to how these activities should
be carried out on your land.
It is important to negotiate in good faith and be reasonable in
your dealings with a resource company. Inevitably they will be
conducting advanced activities on your land, the question is what
compensation they will have to pay you for it.
For further information and to check whether tenure has been
granted by the Queensland Government over your land, Holding
Redlich's Agribusiness and Rural Industries Group is able to
assist with further advice.
If you have been approached by a resource company, are currently
engaged in negotiations or are concerned by a grant of tenure over
an area encompassing your land please contact the Holding Redlich
Agribusiness and Rural Industries Group.
1Petroleum and Gas (Production and Safety)
Act 2004 (Qld), ss 532 to 534.
2Ibid ss 535 to 537D.
3Ibid s 500A.
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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