Controversial Nothern Territory Petroleum Regulations Allowing Fracking Commence

Thursday 7 July 2016 @ 11.37 a.m. | Trade & Commerce

The Petroleum (Environment) Regulations 2016 (SL No 32 of 2016) were, according to the Northern Territory Government's website, approved by Executive Council and signed by the Administrator on Tuesday the 28th June 2016 and came into effect on Wednesday 6 July 2016. The website states that the regulations were developed by the Department of Mines and Energy (the DME) following ". . . extensive public consultation", however, while this may be so, as ABC News reports, the new legislation is seen more as an attempt to appease those opposed to Hydraulic Fracturing (HF) - "Fracking":

"The new legislation is an attempt to appease critics that are concerned the controversial method [HF] of extracting gas and oil is environmentally dangerous, as the Opposition Labor Party continues to push for a moratorium on the practice."

Object of Regulations

At its official website, the Northern Territory Government states its support for the "responsible development of an onshore oil and gas industry that has the potential to provide significant, long term economic benefits for Territorians". Such benefits being said to include:

  • employment opportunities;
  • regional economic and infrastructure development; and
  • the potential for future royalties to provide greater educational opportunities as well as economic independence for the Territory.

The Northern Territory Government states that new environment regulations ". . . form an important part of the regulatory framework for the onshore oil and gas industry and are key to ensuring environmental protection and an increase in community confidence". It also states that the new regulations have been ". . . developed to incorporate best practice from other Australian jurisdictions".

Important new requirements introduced by the regulations are:

  1. All onshore oil and gas activity must demonstrate that all environmental risks and impacts are identified and reduced to an "acceptable level" and are "as low as reasonably practicable".
  2. A condition of the regulations is that approved Environment Management Plans will become public and legally binding documents meaning that companies must comply with their approved plans. In this respect, plans that were approved prior to the commencement of the regulations will be deemed to be approved plans for a period of 18 months until 1 December 2017.

Commenting on the changes, the ABC reports DME chief executive Mr Ron Kelly, as saying:

"One of the major changes to the regulations taking effect today is a move from the Government telling companies how to construct or develop their projects, . . . We've moved to a process where we tell companies what they need to achieve and then it's up to the company to come up with a plan or a process or construction technique that we assess as acceptable".

In producing the regulations, the Northern Territory Government says that it has followed the recommendations of Dr Allan Hawke AC about the introduction of a best-practice regulatory system for the Territory and also that it has taken into account the recommendations of energy law expert Dr Tina Hunter. Further, in support of the regulations, the Northern Territory Government claims that the regulations ". . . embrace the principles of Ecologically Sustainable Development (as defined in the Commonwealth’s Environment Protection and Biodiversity Conservation Act) and focus on minimising environmental impacts to as low as reasonably practicable".

An Umpire to be Appointed

The ABC News reports that during the debate on the regulations in Parliament, concern were raised that the "process [under the regulations] lacked transparency". This claim, it is reported, led the Minister for Mines and Energy Mr Tollner to promise an "independent" or "third umpire". On this DME chief executive Mr Ron Kelly is reported to have indicated that the NT budget had announced ". . . a chief scientist role in the Northern Territory, . . . and that the DME were:

" . . . looking at how we can utilise services of that entity as well in overseeing the governance and implementation of our processes here."

The Critics and the Opposition

Previously, the ABC had reported that the regulations were critcised by the independent Member for Nelson Mr Wood who said the laws ". . . failed to set enough safeguards" referring to the submission by the Environmental Defender's Office (the EDO) raising concerns about the Government's legislative model, the lack of minimum environmental standards and the absence of an independent third party to review decisions. The EDO is reported as saying of the Draft Regulations that they did: ". . . not define what is meant by 'acceptable' or 'as low as reasonably practicable', . . ."

The opposition is reported as also raising concerns that the Northern Territory Government's regulations gave too much power to the DME and expressing the view that the Environment Act ". . . needs to be strengthened considerably, . . ." to update "outdated confusing rules" and comply with "community expectations".

Generally, the new legislation is being reported as ". . . an attempt to appease Government critics" that are concerned that the controversial HF method of extracting gas and oil is environmentally dangerous, and to counter the push by the Labor Party Opposition for a moratorium on the practice of HF. 

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