The laws that govern interactions between resource authority holders and landholders have changed with the commencement on 27 September 2016 of relevant parts of the Mineral and Energy Resources (Common Provisions) Act (Act).

The Act has a long history. A creation of the Newman Government, it had passed through parliament but not commenced when the 2015 election was called. We previously reported that much of what the Newman Government sought to achieve as between resource authority holders and landholders was unwelcome news for primary producers.

Since the change of Government in early 2015, the Act has been reviewed and amended by the Palaszczuk Government and has now become law. Fortunately, the former Government’s most controversial changes (to objection rights and the restricted land regime) have been scrapped, maintaining some fairness for landholders and the broader community.

The remaining changes implement a consistent restricted land framework across all resource authority types, introduce “opt out” agreements, provide for agreements between landholders and resource authority holders to be noted on property titles, and expand the Land Court’s powers when negotiations fail.

New restricted land regime

The Act introduces a consistent “restricted land” regime, based on the rules that previously applied only to mining leases, to all types of resource authorities.

Landholders will now have a right to say “no” to proposed activities within 200 metres from particular permanent buildings (such as a residence) or areas used for particular intensive agriculture (such as feedlotting or poultry farming) or 50 metres from particular infrastructure including principal stockyards, dams, bores and water storages.

For production resource authorities, the restricted land regime applies only to areas that meet the definition of “restricted land” when the application for the resource authority was made. For exploration authorities, new areas can become “restricted land” over the life of the authority; for example, if a new water storage facility is constructed.

Opt-out agreements

Since 2010, an authority holder has been permitted to enter land to carry out advanced activities where each owner and occupier has entered into a conduct and compensation agreement, a deferral agreement (deferring the negotiation of a conduct and compensation agreement until after entry) or the matter has, following unsuccessful negotiations, been referred to the Land Court.

The new Act introduces another concept: an “opt-out” agreement which negates the need for a conduct and compensation agreement or Land Court proceedings. The original thinking behind opt-out agreements was that they would suit situations where authority holders and landholders have established working relationships and do not need a new conduct and compensation agreement to cover additional activities.

In our view, “opt out” agreements could be exploited by authority holders and used to deny landholders the benefit of conduct and compensation agreements. We cannot envisage a situation where signing an “opt out” agreement would be a landholder’s best option.

Landholders should always seek legal advice before signing any document presented by a resource company and in almost all instances the resources company will be obliged to pay for that advice.

Recording agreements on title

Certain agreements, including conduct and compensation agreements, reached between authority holders and landowners are binding on successive owners of the land. However, until now, there has been no independent record of such agreements and, as a result, purchasers have been at risk of becoming bound by undisclosed agreements.

Resource authority holders must now give notice to the Registrar of Titles of any continuing conduct and compensation agreements by 27 March 2017 so that the existence of the agreements can be noted on title. From now on, the Registrar must be notified within 28 days of a new conduct and compensation agreement or opt-out agreement being entered into or coming to an end.

The content of the agreements will not be publicly accessible.

Increased powers for the Land Court

The Land Court now has new express powers to decide how and when a resource authority holder may enter land and how authorised activities must be carried out. In other words, the Land Court is empowered to impose conduct conditions in conjunction with an assessment of compensation.

As a general rule, landholders will continue to have only 20 business days to reach agreement with an authority holder after being given notice of the authority holder’s intention to negotiate before either party can commence dispute resolution processes. However, if those processes fail, the Land Court can order the parties to go back and engage in a further conference or mediation. For the purpose of making such orders, the Land Court is now specifically empowered to take into account the behaviour of the landholder and the resource authority holder in the process that led to the Land Court’s involvement. These are welcome changes.

Thynne + Macartney’s Agribusiness team has assisted landholders to reach better agreements with over 200 different resource companies in recent times. It was recognised by legal publication Doyle’s Guide in 2016 as the only first-tier Queensland Agribusiness law firm.

This information is intended to provide a general summary only and should not be relied on as a substitute for legal advice.

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