EIDA Merger

The purpose of this article is to consider what impact the merging of the EIDA into the MRSDA may have upon the extractive industries, both new and existing, across Victoria. These comments are of a general nature and there will be variances between sites.

COMMUNITY ENGAGEMENT

The merged Act requires at several points that public interaction must occur before, during and aft er a Work Authority is issued by the Department of Primary Industries (DPI). This will only apply to new Work Authorities and those varied under the new Act. The importance of community engagement was highlighted on a number of occasions in the reading of the Bill at parliament where the clause was applauded as a positive step forward.

In addition, Environmental Review Committees (ERC) can be established as part of the DPI conditions upon the site based on specific issues. An ERC may also be required by recommendation of the Responsible Authority.

Their meetings will be scheduled periodically and will require considerable management on the part of the Work Authority holder in data monitoring, report writing and communication.

Considering the experience of those businesses that have used the community engagement model, issues commonly raised are listed below. What is raised will depend upon community perceptions or misconceptions.

• Traffic impact
• Noise
• Dust
• Visual amenity
• Native vegetation and fauna (both from the DSE’s perspective and that of the local community)
• Blasting
• Public health
• Licensee/manager as a competent person
• Ground water
• Greenhouse gas impact (overall energy audit considering all fuel sources)
• Water usage
• Chemical usage (such as engine solvents)

The cost impact will vary greatly depending upon the sensitivity of the site and tends to be upwardly affected by public interest, with specific requests from regulators, if an EES is required or if a Federal Government department is involved.

Upfront and open discussions on what the objectives are can reduce public fear, with the personality of the proponent’s representative (oft en a senior manager) being vital.

Guidance on community engagement will be prepared by the DPI over the coming months.

REHABILITATION BONDS

The obligation of the proponent to present a Rehabilitation Plan compliant to the requirements of the DPI and other referral authorities has remained. The bond calculator remains. There are however several new obligations.

The first is the possibility DPI will require the proponent to engage an independent auditor to verify the bond. Th is is an unlikely situation with no known instances to date of the DPI requesting an independent auditor.

Bonds will no longer be returned six years aft er the Work Authority has been cancelled, rather they will only be returned once there is no potential for any long term damage. This can include a wide range of issues such as erosion control, slope stabilisation, drainage management, and protection of slimes dams.

According to the DPI, a similar change was made in the mining act a number of years ago, as companies tended to have difficulty rehabilitating sites within the six years resulting in the bond being called in by the DPI and contractors engaged to complete the work.

The DPI would prefer that industry complete the work in a timely and cooperative fashion.

LANDOWNER’S CONSENT

The Work Authority is no longer dependent upon the landowner’s continual consent. As such, this matter should be dealt with through commercial arrangements when such a relationship exists.

PROVING ECONOMIC VIABILITY IN THE MINING INDUSTRY

The purpose of the revised Act is ‘to encourage economically viable mining and extractive industries’.

The DPI has indicated that this will not result in any additional obligations for the extractive industries, however an understanding of what occurs in the mining sector has been provided.

Major developments usually source monies from the market in the form of a prospectus and the issue of shares.

To articulate the economic viability of a site, the Australian Stock Exchange (ASX) recognises the code JORC*. This code is also accepted by the DPI. Identified mineral resources are inferred, indicated or measured while ore bodies are either probable or proven.

Small mining licences (i.e. less than 5 hectares) only have to report indications of minerals, but have to prove their capacity to undertake the work detailed within both the Work Plan and Rehabilitation Plan, including a bank guarantee bond to cover the proposed work.

Economic viability of an extractive industry operation could focus on the volume and quality according to civil engineering use codes. This would need to be established by drilling to depth and core analysis.

ADVISORY PANELS

This is a new legislative tool for the extractive industry under the merged Act.

The Minister may call an Advisory Panel if there is public outrage, sensitive issues or mineral development of State significance. The panel will consist of expert scientists, engineers and the like to review all issues brought to the table in the preparation of a Ministerial report.

The Minister will then make a decision, draft conditions or impose conditions on the industry or licensee to undertake best practice. The costs to collect and present data are not compensatable, however the more general panel costs are borne by the Minister.

Advisory Panels are not common.

Two examples of such advisory panels:

• Yalloum Batter Collapse technical review board who will review critical geotechnical issues, monitor data and review procedures. Findings will then be provided to the DPI.
• The Earth Resources Development Council who provide strategic advice to the Minister.

CODES OF PRACTICE

The DPI will be able to make Codes of Practice under the merged Act, with the first code flagged as one outlining minimum Work Plan requirements for small sites. Codes of Practice must be advertised prior to their development and submissions to the draft given consideration. A breach of a code is not an offence; however they can be used in legal proceedings.

Although this is potentially an additional obligation, it is seen as generally positive for industry with greater clarity of issues.

SIZE OF THE WORK AUTHORITY

The area which is considered to be the minimum area for a Work Authority has been increased from 2,000m2 (ie 0.2ha) and 2m deep to one hectare and 2m deep. Sites which are up to 5 hectares and 5m in depth may be exempt from a Work Plan if they don’t blast or have native vegetation issues, however would need to comply with a Code of Practice.

Existing Work Authorities that fall into this latter category could, as of 1 January 2010:

• Immediately become subject to the Code of Practice and not follow the existing Work Plan
• Continue to operate under the existing Work Plan for 5 years and then change to the Code of Practice
• Change to the Code of Practice if any change or variation is requested.

INFRINGEMENT FINES BY DPI OFFICERS

There appears to have been a net increase in the number of penalties and the value of these penalties (particularly for corporations).

PLANNING PERMIT WHERE AN EES IS REQUIRED

The requirement to seek a Planning Permit if an EES is required has been removed and under the merged Acts it would only be necessary to hold either an approved EES OR a Planning Permit.

PLANNING AND ENVIRONMENT ACT

Th e obligation to gain a Planning Permit after the Work Plan is endorsed by DPI but before the Work Authority is granted is generally continued.

The costs of this will be dependent upon a number of factors; however it does rely on the ability of the DPI to act as lead agency.

*JORC is an Australian Code for reporting of identified mineral resources and ore reserves.

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