Environment Protection Requirements

Australian Regulatory Environment
Other Approvals

Australian governments require petroleum companies to conduct their activities to a high standard of environmental protection.

The petroleum industry’s environmental record in Australia, particularly in offshore areas, has been exemplary. The objective based Environment Regulations (outlined below) provide companies with flexibility in managing environmental protection requirements.

Australian Regulatory Environment

Onshore (and coastal waters)
In Australia, the State and Territory Governments own and administer petroleum rights over land and coastal waters (within three nautical miles of the coastline). In these areas, although the Australian Government has some responsibilities regarding environmental protection, in particular under the Environment Protection and Biodiversity Conservation Act 1999, the State and Territory Governments are the main authorities for environmental management of most projects. While the law and the process varies between the States/Northern Territory, the basic elements are similar for identifying, planning and managing likely environmental impacts.

Offshore
The Australian Government has jurisdiction for the regulation of petroleum activities in waters more than three nautical miles from the coastline. Day-to-day administration and environmental regulation is, however, carried out by the relevant State or Northern Territory Designated Authority (the State or Northern Territory Minister for Resources or equivalent).

Regulation of Offshore Petroleum Projects in Commonwealth Waters
Current Australian Government legislation relevant to environmental management of offshore petroleum exploration and development activities includes:

PSLA and its Regulations;
Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act);
Environment Protection (Sea Dumping) Act 1981;
Protection of the Sea (Prevention of Pollution from Ships) Act 1983; and
Historic Shipwrecks Act 1976.

Of particular relevance to the oil and gas industry are the complementary requirements of the PSLA and EPBC Acts. Under these two Acts, there are four main environmental approvals that may be required for petroleum industry activities:

an Environment Plan under the Petroleum (Submerged Lands) (Management of Environment) Regulations 1999, (the Regulations);
- - this is required for every activity;
approval under Chapter 4 of the EPBC Act to undertake an activity that is likely to have a significant impact on a matter of National Environmental Significance (NES);
permits under Chapter 5, Part 13, of the EPBC Act to undertake activities that may potentially affect protected species, in particular cetaceans (e.g. whales and dolphins);
- - for cetaceans this is required only at locations and during times that cetaceans are likely to be present; and
permits under Chapter 5, Part 15, Division 4, of the EPBC Act to carry out activities in a Commonwealth Marine Reserve.

Petroleum (Submerged Lands) Act
Petroleum exploration and development activities in Australia’s offshore areas are subject to the environmental requirements specified in the Petroleum (Submerged Lands) Act (PSLA) and associated Regulations.

The PSLA contains a broad requirement for titleholders to operate in accordance with “good oil-field practice”. Specific environmental provisions relating to work practices essentially require operators to control and prevent the escape of wastes and petroleum.

The Act also requires that activities are carried out in a manner that does not unduly interfere with other rights or interests, including the conservation of the resources of the sea and sea-bed. In some cases, where there are particular environmental sensitivities or multiple use issues it may be necessary to apply special conditions to an exploration permit area. The holder of a petroleum title must maintain adequate insurance against expenses or liabilities arising from activities in the title, including expenses relating to clean-up or other remedying of the effects of the escape of petroleum.

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Environment Regulations under the PSLA
The Management of Environment (MoE) Regulations provide an objective based regime for the management of environmental performance for Australian offshore petroleum exploration and production activities in areas of Australian Government jurisdiction. Key objectives of the Regulations include:

to encourage industry to continuously improve its environmental performance;
to adopt best practice to achieve agreed environment protection standards in industry operations; and
to ensure operations are carried out in a way that is consistent with the principles of ecologically sustainable development.

A key feature of the Regulations is the requirement that an operator submit an Environment Plan to the relevant State/NT Designated Authority before commencing any petroleum activity. An accepted Environment Plan will establish the legally binding environmental management conditions that must be met by the operator of an offshore petroleum activity. An Environment Plan must:

be appropriate for the nature and scale of the activity;
demonstrate that the environmental effects and risks of the activity will be reduced to as low as reasonably practicable;
demonstrate that the environmental effects and risks of the activity will be of an acceptable level;
provide for appropriate environmental performance objectives, environmental performance standards and measurement criteria; and
incorporate an appropriate implementation strategy (including an oil spill contingency plan) and monitoring, recording and reporting arrangements.

The Environment Regulations and Guidelines on the preparation and submission of an Environment Plan can be accessed on the petroleum environment website.

Environment Protection and Biodiversity Conservation (EPBC) Act
While the MoE Regulations under the PSLA manage day to day petroleum activities and apply to any activity that may have an impact on the environment, the EPBC Act regulates assessment and approval of proposed actions are likely to have a significant impact on a matter of National Environmental Significance (NES). This assessment and approval is undertaken by the Australian Government Environment Minister. The EPBC Act does not replace the need for an Environment Plan to be approved under the PSLA (Management of Environment) Regulations before an action can proceed.

The EPBC Act places the onus on the proponent for ensuring an action is either approved or is unlikely to have a significant impact on a matter of NES. If a person is unsure whether approval is required, they should refer the action to the Australian Government Environment Minister for clarification as to whether the action would be a 'controlled action' under the EPBC Act. If an activity is not judged to be a controlled action, the proponent is free to carry out the activity, provided it is done within the parameters specified in the original referral.

A range of EPBC Act Policy Statements are available which provide guidance on the practical application of the EPBC Act. The Significant Impact Guidelines 1.1 – Matters of National Environmental Significance is the primary source of guidance as to whether an action is likely to have a significant impact on a matter of national environmental significance. The policy statements as well as referral forms and general information on the EPBC Act can be obtained from the Department of the Environment and Water Resources’ Community Information Unit on 1800 803 772 or the website at www.deh.gov.au/epbc/index.html .

Potential proponents are encouraged to speak to the Department of the Environment and Water Resources and the Department of Industry, Tourism and Resources at an early stage of their project planning.

Matters of NES protected by the EPBC Act are:

nationally threatened species and ecological communities;
migratory species;
Commonwealth marine areas;
World Heritage properties;
National heritage places;
Ramsar wetlands; and
nuclear actions (including uranium mining).

For offshore petroleum activities, the first three matters of NES are the most relevant.

If granted, final approval by the Australian Government Environment Minister may be with or without conditions. As a minimum, undertakings specified by the proponent in its documentation generally become conditions of approval.

If an action is likely to affect a protected species under Part 13 of the EPBC Act or be carried out in a Commonwealth reserve permits related to these matters may also be required under the EPBC Act. Of most relevance are possible interactions with cetaceans. EPBC Act Policy Statement 2.1 – Interactions between offshore seismic operations and larger cetaceans is available on the Department of the Environment and Water Resources website and provides specific guidance on the application of the EPBC Act.

For the reasons outlined above, any offshore petroleum activities in Commonwealth waters that are likely to have a significant impact on the environment or any other matter of national environmental significance will require approval from the Australian Government Environment Minister under the EPBC Act and must be taken in accordance with conditions attached to any approval.

Details of the environment legislation and the steps to gain environment approval can be found on the Department of the Environment and Water Resources website.

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Other Approvals

Cetaceans
A general environmental approval or clearance from the NES triggers under the EPBC Act does not cover interactions with cetaceans (e.g. whales). A separate permit is required from the Department of the Environment and Water Resources when an action may interfere with cetaceans. ‘Interference’ involves causing a significant change in behaviour, including a significant deviation from their migratory path, or a substantial change in respiration or swimming pattern. Information on interactions with cetaceans and the steps to obtain a cetacean permit can be found at www.deh.gov.au/coasts/species/cetaceans/index.html.

Further, the Department of the Environment and Water Resources has developed cetacean interaction guidelines that aim to provide guidance on interactions with whales and other cetaceans during offshore seismic exploration activities. Management guidelines in the document lay down specific procedures to be followed when undertaking seismic surveys. The guidelines were approved by the Australian Government Environment Minister following consultation with industry, government and conservation groups. The guidelines are under review in consultation with stakeholders.

Procedures that apply according to the circumstances of the interaction include, amongst other things: soft start procedures, visual observations, stop work procedures, aerial surveys, and reporting and recording procedures. The guidelines can be found at: www.deh.gov.au/epbc/assessmentsapprovals/guidelines/seismic/index.html

Commonwealth Marine Protected Areas
There are currently 13 Marine Protected Areas (MPA) in Commonwealth waters. Approval is required if an action is to be undertaken within an MPA. A further 13 areas in the South-east Marine Region are proposed to be declared in the latter half of 2006 under the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act).

The South-east MPA network is one of the key outcomes of large scale regional marine planning. Marine Bioregional Plans will be developed under the EPBC Act across the Commonwealth’s five marine regions. The plans aim to provide greater guidance about marine environment conservation priorities and will assist in understanding the impacts of actions on the Commonwealth marine environment and determining the circumstances under which actions can take place. The process includes the identification and establishment of marine protected areas in the Commonwealth managed waters of Australia.

All MPAs are managed primarily for biodiversity conservation. Specific zoning and management arrangements allow for uses that are consistent with the management plan in operation for the area, which may include exploration and production of petroleum, tourism and fishing activities. Approval of petroleum activities requires assessment of the action proposed against the management plan in effect, with a recommendation going to the Australian Governor-General. Information on undertaking activities within a Reserve can be found in the individual Management Plan for each Reserve.

Plans of management for current reserves, as well as information on new reserve proposals, can be found at: www.deh.gov.au/coasts/mpa.

Development of Carbon Capture and Storage Legislation
The Australian Government has commenced the development of a legislative model to provide access to offshore areas and property rights for the storage of CO₂. It is anticipated that the legislation will be considered by Parliament in 2007. If passed, acreage specifically relating to CO₂ storage should be released in 2008.

For further information on offshore petroleum environmental assessment processes contact:

Manager
Environment Safety and Security Section
Resources Division
Department of Industry, Tourism and Resources
GPO BOX 9839
CANBERRA ACT 2601
AUSTRALIA
Telephone: +61 2 6213 7934
Facsimile: +61 2 6213 7818
E-mail: petr_envr@industry.gov.au

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