Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

I rise to speak in support of this bill. The opposition are supporting this legislation so that the petroleum exploration industry does not suffer from uncertainty brought about by an oversight in failing to require appropriate sign-offs under the Environment Protection and Biodiversity Conservation Act 1999. We have acted quickly to respond to the government's need to ensure completeness in the approvals. The Offshore Petroleum and Greenhouse Gas Storage Amendment Bill 2016 will amend the Offshore Petroleum and Greenhouse Gas Storage Act 2006 to validate past joint authority decisions to grant renewals or extensions to petroleum titles which have prior usage rights.

Urgent action is now required to avoid exploration title uncertainty. Legal advice from the Australian Government Solicitor indicates there is a high risk that petroleum title renewal and extension decisions made without the environment minister's consent are at risk. Importantly, this is a technical issue that has not had an impact on the environmental requirements associated with the titles or work programs consistent with the terms of the titles. Joint authorities generally comprise state, territory and Commonwealth ministers responsible for energy and resources with many decisions made by departmental officials under formal delegation arrangements.

Subsection 359(3) of the Environment Protection and Biodiversity Conservation Act 1999, known as the EPBC Act, requires that a title—that is, a permit, lease or licence—that is a 'prior usage right' must have the written consent of the Commonwealth environment minister or the appropriate delegate before the right can be renewed or extended. A petroleum title is a 'prior usage right' under the EPBC Act if the title was in force on the date of the proclamation of a Commonwealth marine reserve that overlaps the title area. Titles that are a 'prior usage right' are exempt from having to comply with the provisions of the EPBC Act and regulations that relate to a Commonwealth reserve. They are also exempt from having to comply with any management plan for the reserve.

There have been three relevant Commonwealth marine reserve proclamations that have led to petroleum titles becoming prior-usage rights. There was the proclamation of the South-east Commonwealth Marine Reserves Network, in 2007. There was the proclamation of the Commonwealth marine reserves in the South-west, North-west, North, Coral Sea and Temperate East marine regions, November 2012. There was the re-proclamation of the Commonwealth marine reserve South-east, North-west, North, Temperate East and Coral Sea marine regions, in December 2013. It has become apparent that since 2008 an administrative oversight has led to petroleum titles that carry prior-usage rights being renewed and extended by the joint authorities without environment minister's consent, as required under the EPBC Act. The consent of the Minister for the Environment, pursuant to subsection 359(3) of the EPBC Act, was not sought as required for a number of prior-usage rights within the areas over which petroleum titles were granted, due to an administrative oversight.

The administrative error applies to the renewal or the extension of 42 petroleum titles with prior-usage rights, including 33 that are still active. The titles for all companies operating in the Great Australian Bight have not been affected by this administrative error and therefore are still valid. A company wanting to undertake offshore petroleum activities must obtain approval from the independent expert regulator, the National Offshore Petroleum Safety and Environmental Management Authority. This includes those who seek to undertake activity in the Great Australian Bight, such as BP. Notwithstanding the administrative oversight, all petroleum activities have continued to be subject to robust regulatory assessment by the National Offshore Petroleum Safety and Environmental Management Authority against stringent safety, integrity and environmental management requirements that were set out under the Offshore Petroleum and Greenhouse Gas Storage Act 2006 and the various associated regulations.

Affected titleholders that have undertaken offshore petroleum activities have obtained approval from the National Offshore Petroleum Safety and Environmental Management Authority in accordance with the requirements of the environmental, safety and well-integrity regime. All current offshore activities continue uninterrupted and are regulated. The amendments made by this bill will validate past joint authority decisions to grant renewals or extensions of prior-usage-rights titles where the consent of the Minister for the Environment was neither sought nor given under subsection 359(3) of the EPBC Act. Amendments to validate affected decisions are the only way to satisfactorily eliminate the risk that affected decisions pose for titleholders. The Commonwealth minister has advised affected titleholders, together with all state and territory ministers, of the flaw and this particular remedy. I commend the bill to the Senate.

Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

I rise to make a contribution to the debate on the Offshore Petroleum and Greenhouse Gas Storage Amendment Bill 2016, which is being rushed through this place. I would also like to indicate that I have a range of questions I would like to ask, so I will be requesting we go into Committee of the Whole on this bill. Because it is being dealt with so quickly, we do not have an opportunity to send it to committee. Therefore, I think it is only right that we ask some questions in Committee of the Whole. Here we have Labor siding with the government to rush this piece of legislation through to deal with an administrative oversight. It is not explained how the administrative oversight occurred. How can Australians be satisfied that this is not the only administrative oversight that has occurred with environmental assessments.

Although Senator Carr talked about NOPSEMA, when this process of administrative oversight started NOPSEMA was not even in existence. It did not exist then, so we have had a period of time where we had these leases overseen by inadequate assessment processes. Also, questions are now raised over the functioning of NOPSEMA and whether they can have administrative oversight where they just happened not to have environmental tick-off on these leases—and that is under the best minister in the world, Mr Hunt, as the environment minister! This started, I will acknowledge, under the previous government, so I do not think you have to look very far to realise why Labor is rushing so much to support the government in driving this legislation through the parliament—it does not want to have too much scrutiny over how this problem occurred in the first place.

People should be extremely concerned that some of our key laws that are meant to protect our environment have basically been ignored. Section 359 of the Environment Protection and Biodiversity Conservation Act specifies that if someone has rights immediately before a Commonwealth reserve is declared then those 'prior usage rights', as they are called, continue. That means that where there was already a right for exploration or extraction that continues to exist. I will point out that one of our concerns has always been that the environmental assessment process and review process does not kick in early enough, so this problem of exploration and production in environmentally sensitive areas actually starts when they start this process of the release of acreage. 'Acreage' is what they call it when they release areas of the marine environment for bidding for exploration by petroleum companies, and that has always been a fundamental concern of mine and the Greens.

However, let me go back to this specific issue. Subsection 359(3) of the EPBC Act also specifies that the prior usage right can only be extended with the approval of the Minister for the Environment and only under the conditions that the minister sets. This is an important point. It means that even if a prior usage right exist when a Commonwealth reserve is declared, the Minister for the Environment has to review it and, if necessary, apply conditions. The Minister for the Environment—and, in this case, at the moment, the best minister in the world—has not been doing his job, the department has not been doing its job and, obviously, the procedures have fallen down, and I want to ask a whole lot of questions about how those procedures managed to fall down in this particular example.

We now have legislation being pushed through to validate these leases that have not been subject to due process, and the obvious question is: what else has not been subject to due process? Are there other administrative oversights that have occurred and that we do not know about? What we know is that petroleum activity in Commonwealth reserves is going on that has not been subject to this process. We need a better explanation than 'administrative oversight'. The explanatory memorandum to this bill says:

… an administrative oversight has recently been discovered, whereby the consent of the Minister for the Environment was not sought as required for decisions to renew or extend the term of 'prior usage rights' titles…

As we have just heard, this apparently applies to 42 renewals or extensions that have been affected.

I remember when we were debating the NOPSEMA legislation and the changes to the NOPSEMA legislation that handed far more environmental control over to the department that is also responsible for the exploitation—it is an exploitation of resources department—that a lot of people in the community were very concerned that this would reduce environmental assessment and environmental controls. I raised concerns in this place, and what do we see now? We see this administrative oversight where leases have not had consent from the Minister for the Environment and no-one has explained how it occurred. Just some of the questions that I will be asking are: how did the department discovered the mistake; when did the department discover the mistake; when did the minister know; when did the environment minister know; when did the coalition notify Labor on the issue; what are the renewals that have occurred; and, in detail, which marine parks are affected?

These questions all remain unanswered. There is so much we do not know. That is why I will be asking for a Committee of the Whole process. We do not know what other mistakes have been made. The government has announced this fix, but what other mistakes have been made through our environmental assessment process? As Michelle Grady from Pew said in the media when this mistake was first announced:

Mining in marine parks is a concession, which must have the highest scrutiny given the impact on marine life, fishing and local communities that can occur as a result of seismic exploration, drilling operations and oil spills.

We know the devastation that spills from petroleum activity can have on our marine life. We know there is not a lot of support in the community for exploration and production in national parks, on a terrestrial basis, or in marine parks. These, as Michelle pointed out in her comments, are concessions that are given. We expect the highest level of scrutiny regarding activity in our environmentally sensitive marine areas. We have to remember that these marine parks and marine reserves that we are talking about are in particularly environmentally sensitive areas. They are areas that we have said are so important that we need to put them in to marine reserves.

The government, and the departments, know that these are highly sensitive marine protected areas, that the reason they are protected is that they have particular environmental values—they are unique. In some places we have marine biodiversity that is found nowhere else in the world. We know the impact of things like global warming and coral bleaching on our marine life. We know the impact of overfishing. We know the impact from other oil and gas activity and accidents from around the world. Knowing all that, the department overlooked and made an administrative oversight regarding exploration and production leases in marine protected areas. How can our community be confident that the rest of the leases in our marine protected areas and proposed marine protected areas do not have further administrative oversights associated with them? And let's not forget the leases that are still being granted over areas that are supposed to be in marine protected areas. We have not heard from the government an adequate explanation about how this occurred, and I look forward to the government explaining how this occurred and reassuring the community that in fact we are not continuing to have this problem.

This is a very serious issue and I am just astounded that it can have gone on for so long without somebody picking it up earlier, particularly given the focus we have had in this country on our bioregional marine planning process and establishing what was the world-leading system of marine protected areas, which this government of course sidelined when they dropped the management plans and are still reviewing. And we still have not seen the results of that review. It is getting later and later into this election cycle and still the review process has not been announced, nor when we are going to see the management plans back in place that will mean that the boundaries in our marine parks are not just a series of boundaries with no adequate management—bearing in mind that the vast majority of Australians support our bioregional marine planning process.

Deeply concerned that this administrative oversight has occurred, we do not support the rapidity with which this process is being pushed through by Labor and the government. The government talks—and so does Labor—about the need for certainty for these leases. I would put to you that there is a social licence that these exploration and production leases rely on and that you have stretched thin that social licence by doing this. Oil and gas companies are on notice with oil and gas activity in our marine parks, which are environmentally sensitive and are going to be increasingly important in an environment where the planet is warming, where coral bleaching is going to likely happen more and more, where we continue to see overfishing around the world and where we continue to see the degradation of the marine environment. They are more and more important, and these companies' social licence is running out in our marine protected areas. When you talk about certainty, they are on notice that we do not want them in our marine protected areas. We do not support the process that the government takes in allowing that sort of activity in large areas of our marine protected reserves and our absolutely essential system of marine parks and bioregional marine parks.

We do not support this legislation. It is a tragedy that this has occurred. It should not have happened, and companies are on notice: we do not want them in those marine protected areas. They have been on notice for a long time, and you would have thought that governments of both persuasions would have been paying attention. In particular, bear in mind that when Montara occurred we had that big focus on regulation, and in fact that led to regulatory change, which was a good thing because we tightened it up. We saw that the mistakes that happened led to the Montara accident that spilt millions of litres of oil into our marine environment and led to the spraying of dispersants. And, if you are paying attention and listening to the people in West Timor, they are saying it is continuing to have an impact on their marine environment. It has impacted on their fish and seaweed production, and this government is not paying attention to the calls for even a study into that impact. But this regulatory oversight occurred during that process, when the government was supposed to be paying strict attention to these measures. This is a fail; it is not just an administrative oversight, because it has larger ramifications. We do not support this bill, and I will be asking a series of questions about how this occurred.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I thank the senators who have contributed to this debate. The Offshore Petroleum and Greenhouse Gas Storage Amendment Bill 2016 will validate certain title extension and renewal decisions made under the Offshore Petroleum and Greenhouse Gas Storage Act 2006.

In Australia, offshore petroleum exploration and development is regulated by a title system authorising titleholders to carry out petroleum operations in Commonwealth waters. A petroleum title granted under the OPGGS Act is defined as a prior usage right for the purposes of the Environment Protection and Biodiversity Conservation Act 1999. If the title is in force immediately before the proclamation of a Commonwealth reserve that overlaps the title area, under the EPBC Act it is stipulated that such a usage right may only be extended or have its term renewed with the consent of the Minister for the Environment. A recently identified administrative oversight extending back to 2008 led to certain petroleum titles being renewed or extended under the OPGGS Act without the Minister for the Environment's consent being sought, as is required under the EPBC Act. Without legislative amendment there is a question as to the validity of the relevant extension and renewal decisions made under the OPGGS Act. The amendments proposed in this bill are therefore curative measures designed to validate the affected title decisions. Amendments to validate affected decisions are the only way to satisfactorily eliminate the risk affected decisions posed for title holders.

Despite the aforementioned administrative oversight on affected title decisions, the government is confident that all petroleum titleholders have undertaken their activities in good faith. They have continued to be subject to, and compliant with, the stringent environmental management requirements set out under the OPGGS Act and environment regulations. The government is committed to applying international leading practice in the regulation and the management of environmental safety and integrity risks associated with offshore petroleum operations.

I do also note the questions that Senator Siewert has foreshadowed, and I, of course, will be happy to answer those at the time, but I would like to just stress that this is a technical administrative oversight. It is something that came up due to a lack of process between the Department of the Environment and the department of industry, or its various predecessors responsible for the OPGGS Act. In this time the senator did mention changes that were made in response to Montara. Some of those amendments at the time did confuse this issue. There was a loss of staff, apparently, and these errors occurred. Senator Siewert, I am sure you are not suggesting errors are not made by all of us at different times. This is unfortunate and regrettable, but the best way to deal with something that has gone wrong is to fix it as soon as you can. We are confident that these changes in this bill will help fix that issue, while still maintaining our world-leading environmental standards and regulations, including those on Commonwealth reserve areas.

Question agreed to.

Bill read a second time.