April 28 - May 4, 2024: Issue 623


Minister For Resources Recuses Herself From PEP11 Decision

The Hon Madeleine King MP has released a statement on April 23 that she has recused herself from future decisions on Petroleum Exploration Permit 11 (PEP-11).
The Minister for Industry and Science, the Honourable Ed Husic MP, will take future decisions relating to PEP-11. 

''Minister Husic was appointed to administer the Department of Industry, Science and Resources upon being sworn-in as a Minister on 1 June 2022 and has the legal authority to take future decisions on PEP-11.

The Australian Government has been consistent in its position that it will not provide a running commentary on PEP-11 and this remains the case.'' the statement reads

Ms King, along with Prime Minister Albanese, have made statements to the effect that they oppose PEP11, which could lead to a conflict of interest alike that seen when former Prime Minister Morrison made statements along similar lines, prior to acting in that portfolio to cancel the permit.

Subsequent legal action by the proponents, settled by the now incumbent federal government, questioned the legality of Mr. Morrison's decision, based on what could have been seen as a 'bias'.

Warringah MP Zali Steggall issued a statement in response to the announcement, saying, 
''This project is like a cockroach that just won’t die. Yet my Stop PEP-11 Forever Bill could put an end to this application and future applications for good.''

''The decision around the PEP-11 permit should have been killed off years ago, yet it is still live – keeping concerned communities from Manly to Newcastle in limbo.

To make PEP-11 dead in the water, the most permanent solution is to support my Stop PEP11 Forever Bill. This would not only put an end to the project now, it would avoid the risk of further litigation and future applications being made within the PEP-11 Zone. 

I will be writing to Minister Husic to let him know of our community’s strong opposition to this project, and to consider supporting my Bill to put a stop to it.''

PEP-11 permit holders Bounty Oil & Gas, BPH Energy and operator Advent Energy have continued issuing statements that they will pursue the project in Commonwealth waters after the NSW government passed legislation banning all offshore oil and gas exploration.

BPH said permit operator Advent and its joint venture (JV) partner Bounty Oil & Gas (ASX: BUY) would consider challenging the validity of the bill under section 109 of the Commonwealth Constitution.

Advent and Bounty stated they are waiting on a ruling on extension and variation applications for the PEP-11 permit to allow them to drill the Seablue-1 gas well on the large Baleen prospect.

BPH executive director David Breeze said that while the various applications involving PEP-11 are being considered, Asset Energy is continuing to investigate the availability of a mobile offshore drilling unit and is in communication with drilling contractors and other operators who have recently contracted similar rigs.

The PEP11 application is still listed as 'pending' in NEATS.

The Environmental Planning and Assessment Amendment (Seabed Mining and Exploration) Bill 2024 amends the Environmental Planning and Assessment Act 1979 to prohibit:
  1. Seabed petroleum and mineral exploration and recovery in NSW coastal waters; and
  2. Other development within the state for the purposes of seabed petroleum and mineral exploration and recovery anywhere.
The Bill, which was passed in March 2024, reaffirms the NSW Labor Government’s commitment to protecting NSW coastal waters from offshore mining activities.

'''These activities can have a devastating effect on our marine wildlife by releasing toxic materials, destroying habitat and creating harmful sediment levels. We must prevent this happening.'' the government said in a released statement

The Bill is designed to stop severe environmental damage that can result from offshore exploration and drilling including oil spills and greenhouse gas emissions.' 

The ban exempts coastal protection works including beach nourishment and beach scraping, which involves removing a layer of sand from the foreshore and transferring it to a different location on that same beach. This strengthens beaches, dunes and cliff systems from erosion.

Certain dredging activities, not involving mineral exploration or recovery, which are required as routine practice with environmental and economic benefits will also continue. This includes laying pipelines or submarine cables.

'No other state or territory has acted so comprehensively to prevent the severe environmental impacts that can result from offshore exploration.' the government said

Minister for Climate Change and Energy Penny Sharpe stated:
“The damage from seabed exploration and mining is significant. It threatens our state's sensitive marine environments, coastal areas and Indigenous heritage.

“With broad support, the NSW Labor Government has taken a responsible and balanced approach to banning seabed mining and protecting our marine environment into the future.”

Minister for the Central Coast David Harris said:
“Not only does this ban keep our waters clean and our marine life healthy, but it also gives certainty to coastal communities, like mine on the Central Coast who are overwhelmingly against offshore mining.

“I am pleased to be a part of a government that not only listens to the community but also acts in their best interests.”

During the Legislative Assembly Debate, Manly MP James Griffin stated:

''We have managed to get to this position of furious agreement because of the hard work, often behind the scenes, of the principled, smart and, at times, brave environmental advocacy groups who have, against the trend, gone out on a limb and proactively and comprehensively engaged with conservative politicians and voices over many years. They have brought about this outcome.

These groups have had the courage to buck the trend when it comes to the archetypal environmental advocacy group. It was the gains made by those groups who were willing and able to objectively engage—or, perhaps more importantly, those who truly understood the pragmatism required to change minds, inform, influence and educate using facts—who are ultimately the ones who have effected and will continue to effect the greatest change. The passing of this bill should, rightly, have many people claiming it as their win. It has been a collaborative effort. But that effort and reward belongs to those who were willing to leave their long‑held and often incorrect perceptions and views at the door and get around the table for a discussion. ''

''One of Australia's greatest economic assets is also its greatest environmental asset: the ocean. More than 85 per cent of Australians live within 50 kilometres of the sea, but Australia's ocean economy extends well beyond New South Wales coastal communities. Australia's national marine industries contribute significantly to the economy by generating more than $110 billion in output, adding $105 billion in value to the GDP, whilst supporting 462,000 full‑time‑equivalent jobs. Conservation, restoration and sustainable use and management of marine ecosystems and biodiversity is fundamental to achieving a sustainable ocean economy. In that respect, the proposal of PEP 11, in my view, never delivered highest and best use of the coastal waters of New South Wales and, indeed, does not align with fundamental policy decisions and directions regarding energy security, reliability or cost.''

''The message I leave for other States and Territories of Australia is that the economic benefits of conservation of our coastline presents an overwhelming and comprehensive case. This legislation should not be misconstrued as simply a means to preserve the visual amenity of a portion of the coast, because it is so much more than that. Cheaper, more reliable and secure energy is best achieved through other means. I take this opportunity to acknowledge the many coastal communities, stakeholder groups and various members of Parliament, either historically or more recently, who have delivered this outcome. Well done to all. I commend the bill to the House.''

Pittwater MP Rory Amon addressed the main difference between his 2023 tabled Bill, the Minerals Legislation Amendment (Offshore Drilling and Associated Infrastructure Prohibition) Bill 2023, and that now in place through the work of the incumbent Minns Labor Government, stating:

''There is one other matter in which I note that the Government's bill is weaker than the Coalition's bill. It is a matter of concern, but I am assured that it will be dealt with adequately in the Government's bill. I thank the Minister and his office for facilitating briefings with the relevant departmental lawyers and experts on these matters to assure us of this. But it is important to record that the Government's bill refers to relevant development being prohibited for the purposes of offshore gas mining and exploration. My concern is that it does not specify in detail what that relevant development could include but not be limited to. For a community that was led down the garden path on this matter for many years, the more certainty we have, the better.

I appreciate that the Government's position is not to provide that greater certainty, but I am assured it is there, nonetheless. I will address the matter. The Coalition's bill would have specifically set out that prohibited relevant development would include the maintenance, repair, provisioning or refuelling of vessels, aircraft or equipment used for the relevant development, being offshore gas mining and exploration, handling, refining or processing petroleum or minerals obtained from that development, and the unloading or transportation, including by pipeline, of petroleum or minerals obtained from that relevant development. That was in the original bill but is not in the Government's bill. I am told that it is all good and I will take the Government at its word on that. But I feel it is important we identify the shortcomings or perceived shortcomings of the Government's bill.

Those things said, I congratulate the Government for following the Coalition's lead on this matter. The Prime Minister said he is opposed to PEP 11 and offshore gas mining and exploration. Every member in this place said they are opposed to it. It is good to see they are on board with opposing it by way of legislation. The ball is now fairly and squarely in the court of the Federal Labor Government to ensure that it rejects the renewal of the licence for offshore gas mining and exploration and that it can never be renewed or reactivated in future. To that end, I call on the Federal Government to do more where it can. I commend the bill to the House.''

When the Bill reached the Legislative Council Amendments were moved by Greens Member Cate Faehrmann, who stated:

These amendments will fix a fundamental and obvious flaw with the bill. Clause 3 is what is known as a Henry VIII clause. This is a clause where, so to speak, the tail gets to wag the dog. The long title of the bill says that the bill is "to prohibit the carrying out of seabed petroleum and mineral exploration and recovery". The bill actually does this very well—that is, up until we get to clause 3. The clause allows for exemptions to be made to the prohibitions proposed in the bill simply on the say-so of the Minister, although they need to consult with the Minister for the Environment—not make a decision in concurrence with the Environment Minister; simply consult them. 
In other words, the Executive can, at its whim, completely subvert the intention of the bill and allow the very thing it is supposed to be prohibiting: no parliamentary scrutiny; just the Minister's say-so.

I note that amendments were passed in the other place making it clear that such exemptions cannot be made in the case of fossil fuels, petroleum, coal and oil shale, but the field is left open for any and all other minerals. The Government will tell us that such a clause is necessary to cater for unforeseen circumstances at some point in the future, when something good and sensible that we might like to do might unfortunately and inadvertently fall under the classification of minerals extraction and/or recovery, for the purposes of the Act, and we cannot do it because of the strictures that the Act places on us.

However, the Parliamentary Counsel's Office [PCO] warns about the dangers of a Henry VIII clause. That came from the PCO's submission to the Regulation Committee's inquiry into the making of delegated legislation in New South Wales. The PCO states:

… almost all modern legislation involves delegations to the executive of power to make delegated legislation. A standard regulation‑making power is included in most Acts, in the following terms—

The Governor may make regulations, not inconsistent with this Act, for or with respect to any matter that by this Act is required or permitted to be prescribed or that is necessary or convenient to be prescribed for carrying out or giving effect to this Act.

The issue is whether the power exercised in the delegated legislation is properly executive or legislative in nature, and whether it should receive the enhanced scrutiny and debate that characterises legislative enactments.

The inquiry recommended the following in recommendation 4 of its report:

That, to foster greater transparency in the use of delegated legislative power, the NSW Government ensure that explanatory notes to bills:

highlight the presence in the bill of any Henry VIII clauses, shell legislation or quasi legislation

include an explanation as to why such a broad delegation of legislative power is considered necessary.

As I understand it, that was not done. In his second reading speech, the Minister said:

The bill also provides additional flexibility for exceptions in the form of a constrained regulation-making power in clause 3 of proposed schedule 10. This will accommodate other limited exceptions that offer an environmental or public benefit, and which are deemed necessary through the implementation of the bill.

Let us be clear: The clause in the bill allows for possible exemptions, again, entirely at the Executive's whim for any kind of mineral recovery or extraction—something that is completely antithetic to the purpose of the bill. Let us not forget exactly what we are talking about when we are dealing with seabed mining. As the Minister himself said in his second reading speech:

The impacts of seabed exploration and mining are significant. They are a threat to our State's sensitive marine environments, coastal areas and Indigenous heritage. Offshore mining activities can have a devastating impact on our marine fauna and their habitats, including the release of harmful or toxic materials, the removal of habitat and the creation of harmful sediment levels.

Beyond that, the Minister also said quite clearly that the bill "will give certainty to the community and industry by ensuring that any move away from the prohibition on these activities would require a future Act of Parliament". On the one hand, the Minister wants to provide certainty around prohibition, but, on the other hand—and not really being up-front about it, I have to say—provides a massive back door, a huge "get out of jail free" card for himself, the Government and future governments, for that matter. No Act of Parliament will be needed for a change in clause 3; just a bit of a chat with the environment Minister—which, hopefully, we will deal with in the next amendment—and the Minister can sign off on whatever mineral-related extraction or recovery he likes. That is simply not good enough. It is completely, again, antithetical to the purpose of the bill and what the community was promised. The clause needs to go. I commend The Greens amendment to the Committee.

The amendment, essentially, amends clause 3 (2) of the Bill, changing the requirement for the Minister for the Environment to simply be consulted and instead requires that the Planning Minister obtain the concurrence of the Environment Minister.

The Hon. Penny Sharpe, NSW Minister for the Environment stated the Government supports The Greens amendment that ensures the Environment Minister has concurrence on any regulations.

With the Amendment agreed to, The Hon. Penny Sharpe moved: 
That this bill be now read a third time.

A Third Reading: Once a Bill has passed through the second reading, and where necessary the consideration in detail/committee of the whole stages, a question will be moved "that this bill be now read a third time" If agreed to, the bill has passed all stages and the bill is sent, with a message, to the other House for consideration.