In New South Wales, a title must be granted by the Minister for Resources & Energy under the Petroleum (Onshore) Act 1991 before anyone can prospect, explore for or produce petroleum (including coal seam gas), whether on Crown or private land. Before a petroleum production lease can be granted, development consent must be obtained under the Environmental Planning and Assessment Act 1979 (EP&A Act).

Assessment Process for Petroleum Production Proposals

Petroleum activities are tightly controlled in NSW. The petroleum production lease, together with other statutory approvals, such as environmental protection licences under the Protection of the Environment Operations Act 1997 and planning approvals under the EP&A Act, regulate the impact of potential impacts on the environment.

New petroleum production projects and any expansion of existing projects require development consent under the EP&A Act. Development for the purpose of petroleum production is considered State Significant Development and requires approval from the Minister for Planning & Infrastructure (see the State Environmental Planning Policy (State and Regional Development) 2011 ).

As part of the assessment process under the EP&A Act, proponents are required to prepare and submit a comprehensive Environmental Impact Statement that addresses all potential impacts of the proposal, including potential impacts on water resources, biodiversity, air quality and local communities. In all cases the Environmental Impact Statement and applications are publicly exhibited, and public submissions sought, before any application is considered by the determining authority.

The comprehensive merit-based assessment process considers a broad range of environmental issues including water, aquifers, alternative uses of the land and whether the proposed development is in the best interest of the State.

While the NSW Government encourages sustainable development of our natural resources, regulatory powers are in place to ensure that the impacts of activities are appropriately assessed. Unacceptable impacts will not be approved.

Rehabilitation and Environmental Management Process (REMP)

Conditions are attached to petroleum production leases to regulate environmental management and rehabilitation. These conditions include requirements to submit a Petroleum Operations Plan (POP) prior to the commencement of any operations and subsequent Environmental Management Reports (EMRs). Collectively, the POP and EMR make up the Rehabilitation and Environmental Management Process (REMP).

The REMP provides:

  • a management tool for all operations within the lease;
  • a means of identifying and managing the significant production, rehabilitation andenvironmental aspects of the operation;
  • a means of assessing environmental performance;
  • a mechanism for detailed rehabilitation planning and for monitoring rehabilitation progress and success;
  • a basis for estimating rehabilitation requirements and the amount of security required by NSW Department of Industry, Resources & Energy; and
  • a framework which promotes regular reporting to, and interaction between, government agencies regarding core operations and environmental matters.

The REMP facilitates a flexible response to changing circumstances. The descriptions and plans should be consistent with Resources & Energy requirements. Any significant changes onsite will need to be addressed in a POP amendment which will require approval from Resources & Energy.

Site inspections and audits

Resources & Energy monitors petroleum sites through inspections and audits to ensure compliance with legislative requirements, title conditions and POPs. These may be carried out in conjunction and cooperation with other regulatory agencies. Resources & Energy also has powers for auditing to promote compliance and identify areas of improvement.

Incident reporting

Reporting of environmental incidents is a requirement for all petroleum exploration and production activities. Refer to Resources & Energy Guideline ESB28 – Environmental Incident Reporting Requirements.

Resources & Energy is responsible for investigating community complaints and certain environmental incidents. A range of compliance and enforcement mechanisms are available in accordance with Resources & Energy's legislative and policy framework including penalty infringement notices and, if required, prosecution. Resources & Energy's enforcement approach to non-compliance depends upon the nature or consequences of the non-compliance and the previous performance of the titleholder, including responses to previous notices or sanctions.

For information on how a member of the public may lodge a complaint or report an incident, please refer to Complaints and incident reporting by the public.

Rehabilitation security

It is the responsibility of Resources & Energy to ensure that land disturbed by petroleum production activities is returned to a sustainable land use.

A security deposit that covers the full rehabilitation costs is required on all titles. This requirement ensures that the State does not incur financial liabilities in the event of a title holder defaulting on their rehabilitation obligations.

The title holder is required to provide an estimate of rehabilitation costs for consideration when determining the security deposit amount.

Resources & Energy will assess and determine when rehabilitation obligations have been met and the security deposit can be released. Partial release of the security deposits may occur when successful rehabilitation has been demonstrated for part of the site.

Rehabilitation

Land affected by petroleum production can be rehabilitated to a variety of land uses including cropping and agriculture, native ecosystems, forestry and mixed land uses.

Under the Petroleum (Onshore) Act 1991, Resources & Energy has a wide range of powers for regulating rehabilitation including:

  • environmental management and rehabilitation conditions on production leases
  • rehabilitation security bonds
  • clear enforcement powers to ensure title holders comply with their obligations.

Title holders must also submit and comply with an approved Petroleum Operations Plan (including a rehabilitation plan), which is used for detailed rehabilitation planning and for monitoring rehabilitation progress and success.

Rehabilitation must be undertaken progressively over the life of the project. Resources & Energy has responsibility for determining when rehabilitation has met the required standard, taking into account post production land use, prior to title relinquishment and security deposit release. Partial release of the security deposit may occur when successful rehabilitation has been demonstrated for part of the site.

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For further information
Compliance Operations
Phone:
+61 (0)2 4063 6666
Fax:
+61 (0)2 4063 6977 (attn: Compliance Operations)
minres.environment@planning.nsw.gov.au
Postal:
Compliance Operations, NSW Department of Planning and Environment, Resources Regulator, PO Box 344 Hunter Region Mail Centre NSW 2310
Office:
516 High Street Maitland NSW 2320 Map