The significance of mineral resources is now the principal consideration in determining mining proposals - But will this development be short lived?

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On 4 November 2013, State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) Amendment (Resource Significance) 2013 (Mining SEPP Amendment) came into force. The aim of the Mining SEPP Amendment is to promote the development of significant mineral resources and ensure that the economic benefits of developing such resources is a “principal” consideration in the decision making process.

Over the past two months, the NSW Government has introduced a raft of changes that affect the development of the coal seam gas (CSG) industry in the State. These reforms include:
imposing a hold on exploration and extraction of CSG in Sydney’s drinking water catchment “Special Areas” zone;
prohibiting CSG development in or under all residential areas in New South Wales, the North West and South West Growth Centres of Sydney, and within 2km of such zones;
the commencement of the Mining and Assessment Gateway Panel; and
the signing of a Memorandum of Understanding between New South Wales and the 
Commonwealth to work towards transferring the power to decide matters of national environmental significance under the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act) to the NSW government.  

BACKGROUND

Between 29 July and 12 August 2013, the draft Mining SEPP Amendment (Draft SEPP) was on public exhibition. Our earlier In Brief discussed the Draft SEPP in more detail.

CHANGES TO THE DRAFT SEPP

Following the close of the public submission period for the Draft SEPP, a number of changes were incorporated into the Mining SEPP Amendment to more clearly identify the factors relevant to the assessment of mining proposals and the weight to be given to such factors, as well as the introduction of review requirements.

The key changes introduced by the Mining SEPP Amendment are as follows:

  1. A consent authority must consider the significance of the relevant mineral resource having regard to:

    (a) the economic benefits of developing that resource, both to the State and the region, including:

    (i) employment generation;

    (ii) expenditure, including capital investment; and

    (iii) the payment of royalties to the State; and

    (b) any advice by the Director-General of the Department of Trade and Investment, Regional Infrastructure and Services including in relation to:

    (i) the size, quality and availability of that resource;

    (ii) the proximity and access of the relevant land to existing or proposed infrastructure;

    (iii) the relationship of that resource to any existing mine; and

    (iv) whether other industries or projects are dependent on the development of that resource.

  2. In determining whether to grant consent to a mining proposal, the significance of the resource is to be the consent authority’s principal consideration. In considering other matters, the weight to be given by the consent authority is to be proportionate to the importance of such matters in comparison with the significance of that resource.
  3. The Mining SEPP Amendment applies to all new mining proposals and applications to modify existing development consents.
  4. A consent authority must consider any certification by the Chief Executive of the Office of Environment and Heritage or the Director-General of the Department of Primary Industries that measures to mitigate or offset the biodiversity impact of the proposed development will be adequate.
  5. The Mining SEPP Amendment identifies non-discretionary development standards on particular matters (including noise, air quality, airblast overpressure, ground vibration and aquifer interference) whereby, if the mining proposal will comply with those standards, the consent authority cannot impose more onerous standards. If a Government policy on which the standard is based is changed, the Minister is to review the relevant development standard.
  6. The Minister is to review the Mining SEPP Amendment and publish a report of the review before the end of September 2015.

Implications

The Mining SEPP Amendment is likely to have profound implications for the assessment and determination of applications for the development of significant mineral resources. In particular, consent authorities are now required to consider the economic benefits of a mining proposal over and above other matters such as environmental, social and amenity impacts. These reforms are also likely to significantly water down the implications of the Land and Environment Court decision in Bulga Milbrodale Progress Association Inc v Minister for Planning and Infrastructure and Warkworth Mining Limited [2013] NSWLEC 48, click here for more.

However, the effect of these changes may be short lived as the NSW Legislative Council, as part of its proposed amendments to the Planning Bill 2013 currently tabled in Parliament, has sought to repeal the Mining SEPP Amendment. As a consequence, there is a risk that the Mining SEPP Amendment may be repealed in 2014. In the interim, proponents of mining proposals will face an increased level of uncertainty and, possibly, scrutiny from communities and resident action groups.


The content of this publication is for reference purposes only. It is current at the date of publication. This content does not constitute legal advice and should not be relied upon as such. Legal advice about your specific circumstances should always be obtained before taking any action based on this publication.


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Contacts

Louise Camenzuli

Partner. Sydney
+61 2 9210 6621

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