Australia: New regulations applying to underground petroleum storage systems from 1 September 2014

The Protection of the Environment Operations (Underground Petroleum Storage Systems) Regulation 2014 (NSW) (Proposed Regulation will replace the Protection of the Environment Operations (Underground Petroleum Storage Systems) Regulation 2008 (NSW) (Current Regulation) from 1 September 2014.

The Proposed Regulation aims to enhance the management of underground petroleum storage systems (UPSS), which have the potential to cause contamination and damage to the environment if leaking occurs, resulting in extensive clean-up costs.

This article identifies the manner in which the Proposed Regulation affects the management of UPSSs in New South Wales.


UPPSs are defined by the Proposed Regulation as a system of tanks, pipes, valves and other equipment designed to contain petroleum or control the passage of petroleum between one part of a storage system to another.


The Proposed Regulation will bring the regulation of UPSSs into line with Australian Standard 4897-2008: The design, installation and operation of underground petroleum storage systems (AS4897-2008) with the intention of improving site infrastructure and enabling the early detection of petroleum leaks. The objectives of the Proposed Regulation are to:

  • clarify and align regulatory requirements with other legislation and industry best practice;
  • improve documentation of site management procedures;
  • improve enforceability of requirements;
  • encourage the use of new technologies in the monitoring of UPSS; and
  • reduce duplication in record-keeping.


The Proposed Regulation applies to all sites with active UPSSs in New South Wales. This includes petrol station sites, bulk fuel deposit sites, and sites with UPSSs in use by small businesses (such as workshops and marinas).

The Proposed Regulation does not apply to premises which are licensed to store petroleum products under the Protection of the Environment Operations Act 1997 (NSW) nor does it apply to above ground, liquefied petroleum gas storage systems or "scheduled activity" storage systems.

Under the Proposed Regulation, the EPA will continue to have the power to provide exemptions from compliance with requirements of the Proposed Regulation.


The Proposed Regulation applies to each 'person responsible', which means:

  1. the person with the management or control of a UPSS; or
  2. if the UPSS has been decommissioned, the person who was responsible for its management and control before it was decommissioned.




Regulatory Body The Environmental Protection Authority will remain the appropriate regulatory authority (ARA) until 1 June 2017. The relevant local council may become the ARA but this will depend on the outcome of public consultation prior to that date.
Equipment Integrity Test to be Performed (Clause 12)

The Proposed Regulation mandates minimum pollution protection standards for all new UPSSs. It does not require the upgrade of existing UPSSs to meet these standards. However, any modification to an existing UPSS must meet industry best practice and be designed, implemented and commissioned by a duly qualified person.

Under the Proposed Regulation, a tank forming part of a UPSS must not be used or reused unless it meets the required pollution protection standards, to ensure consistency and compliance with AS4897-2008.

Alternative monitoring (Clauses 16, 17 and 18)

The Current Regulation requires groundwater monitoring wells to be used to detect any contamination from a UPSS.

The Proposed Regulation allows for the implementation of an 'alternative secondary leak detection system' other than groundwater monitoring wells, providing that the alternative system has been certified by a duly qualified person as being an appropriate system for secondary leak detection for the storage site and prepared in accordance with the EPA guidelines.

This change recognises that groundwater monitoring wells are not always the most effective or viable means of secondary leak detection, particularly where tanks are located within a water table or where groundwater is absent.

Environment protection plan documentation (Clauses 19(2) and 19(9))

The Current Regulation requires that a UPSS may only be used if an 'environment protection plan' is in place.

The Proposed Regulation introduces flexibility to this requirement by allowing the responsible person to keep 'environment protection plan documentation' in the form of one consolidated document or a collection of documents, in hard copy or electronic form.

Under the Proposed Regulation, the environment protection plan documentation must also include the location of drainage and services applying to the UPSS site.

Loss monitoring procedure (Clause 19(4))

The requirement for a minimum standard loss monitoring system for all UPSS is intended to promote the early identification of leaks.

The Current Regulation requires implementation of a loss monitoring procedure that meets technical specifications.

Under the Proposed Regulation, a UPSS loss monitoring procedure must be designed in accordance with the EPA guidelines so as to be 'capable of detecting losses of petroleum'. This removes the technical prescription which had proved difficult for some industry operators to implement.

The EPA guidelines will adopt AS 4897-2008 as the default procedure for detecting losses of petroleum.

Secondary Leak Detection (Clause 21)

Under the Current Regulation, sampling and analysis of groundwater monitoring wells must be undertaken 'within 30 days after the occurrence' of the installation of a new groundwater monitoring well, the discovery of groundwater contamination or a leak in a UPSS.

The Proposed Regulation requires sampling and analysis of groundwater monitoring wells to be undertaken 'as soon as practicable' after the occurrence of these events. This change ensures timely investigation of petroleum losses and reduced potential for environmental harm.

Guidelines (clause 29)

The EPA will be responsible for producing guidelines for the purposes of the Proposed Regulation.

The following documents will form the guidelines of the Proposed Regulation from its commencement:

  • Guidelines for Implementing the Underground Storage System Regulation, published by the Department of the Environment and Climate Change (2009);
  • Planning and Development Process for Sites with Underground Petroleum Storage Systems, published by Department of the Environment and Climate Change and Water (2009);
  • Minimum Construction Requirements for Water Bores in Australia, published by the National Uniform Drillers Licensing Committee (2012); and
  • any other guidelines in effect immediately prior to the repeal of the Current Regulation.

Further guidelines may be issued by way of an EPA notice in the NSW Government Gazette.

New definitions
  • leak, in relation to a storage system, means any loss of petroleum from the system because it is not providing full and continuous containment of petroleum. (Note: There is no definition of 'spill').
  • petroleum means any fuel that consists predominantly of a mixture of hydrocarbons derived from crude oil, whether or not the fuel includes additives (such as ethanol), and includes:
    1. used oil; and
    2. synthetic fuels such as 100% ethanol or biodiesel.
  • routine maintenance, in relation to a storage system, includes any repairs to the system that are done in the course of regular scheduled upkeep of the system.
  • significant modification, in relation to a storage system, means any modification to the system that results in:
    1. the replacement of the whole of the system; or
    2. the replacement of a half or more of the tanks in the system.


In summary, the proposed changes are designed to:

  • enable loss monitoring procedures to take into account the particular characteristics and usage patterns of a storage system;
  • provide greater flexibility in the use of loss monitoring procedures for a storage site;
  • enable the use of alternative secondary leak detection systems;
  • enable environment protection plans to be kept electronically as either a consolidated document or a collection of documents;
  • include new definitions such as the definition of 'leak' and clarify the meaning of existing definitions such as the definitions of 'petroleum', 'routine maintenance', 'significant modification' and 'storage site'; and
  • clarify reporting requirements.

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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