BHP Minerals Pty Ltd, QCT Mining Pty Ltd, QCT Investments Pty Ltd, QCT Management Ltd, BHP Queensland Coal Pty Ltd and Mitsubishi Development Pty Ltd, Re [2001] QLRT 67

LAND AND RESOURCES TRIBUNAL QUEENSLAND CITATION: Re BHP Minerals Pty Ltd, QCT Mining Pty Ltd, QCT Investments Pty Ltd, QCT Management Ltd, BHP Queensland Coal Pty Ltd and Mitsubishi Development Pty Ltd [2001] QLRT 67 PARTIES: In the Matter of Mining Leases 1789 & 1923 - Applications by BHP Minerals Pty Ltd, QCT Mining Pty Ltd, QCT Investments Pty Ltd, QCT Management Ltd, BHP Queensland Coal Pty Ltd and Mitsubishi Development Pty Ltd for additional surface areas FILE NO/S: LXX 40047/2000; LXX 40050/2000 PROCEEDING: Applications for inclusion of surface of land in Mining Leases DELIVERED ON: 11 September 2001 DELIVERED AT: Brisbane HEARING DATE: 3 September 2001 PRESIDING MEMBER: Kingham DP ORDER/S: 1. Recommendation made that the area of surface land identified in Application LXX40047 (additional surface area no 2) be included in Mining Lease 1789. (at [29]) 2. Recommendation made that the area of surface land identified in Application LXX40050 (additional surface area no 3) be included in Mining Lease 1923. (at [30]) 3. Recommendation made that the Minister consider whether the description of the mining leases should be varied to ensure they are accurate and confer the protection afforded by s319 of the Act. (at [13]) CATCHWORDS: MINING – MINING LEASE – INCLUSION OF SURFACE LAND IN MINING LEASE – INFRASTRUCTURE ON SURFACE AREA NOT INCLUDED IN LEASE – PAST PERFORMANCE – OBSERVATIONS REGARDING DEPARTMENT RECORDS -RECOMMENDATION – -- 1 of 9 -- Mineral Resources Act 1989, ss 6A, 268, 269, 275, 286(8), 298(6), 319, 402 Environmental Protection Act 1994, Ch13 Part2, s595 ACI Operations P/L v Quandamooka Lands Council Aboriginal Corp [2001] QCA 119 COUNSEL: Mr Peter Ambrose SC for the Applicants SOLICITORS: Allens Arthur Robinson for the Applicants [1] KINGHAM DP: The Applicants in these matters are BHP Minerals Pty Ltd, QCT Mining Pty Ltd, QCT Investments Pty Ltd, QCT Management Ltd, BHP Queensland Coal Pty Ltd and Mitsubishi Development Pty Ltd (“the Applicants”). They have applied under s275 of the Mineral Resources Act 1989 (the Act) for the inclusion in mining lease 1789 of the surface area of a 26.29 ha parcel of land, described in the application as additional surface area no 2. The same applicants have made an application under the same section of the Act for the inclusion in mining lease 1923 of the surface area of a 68.62 ha parcel of land, described in the application as additional surface area no 3. The mining leases are adjoining and the two applications were heard together. Background [2] On 18 July 2001, I rejected the Applicants’ request that I dispense with a hearing1. The hearing was conducted on 3 September 2001 and the Applicants relied on the applications lodged on 10 July 2001 and the Affidavits of Shane Hansen and Peter Roe both filed on 31 August 2001. Other affidavit material and letters from the Department of Natural Resources and Mines were previously filed, but the Applicants did not rely upon them. I have not referred to that material in considering what recommendation I should make. [3] MLs 1789 & 1923, which comprise the Gregory and Crinum mines, are located approximately 53 kilometres north of Emerald. The applications for the inclusion of the identified surface areas are for terms concurrent with the relevant mining leases. 1 [2001] QLRT 48 delivered on 18 July 2001 -- 2 of 9 -- ML 1789 expired on 30 November 1998 and an application to renew that lease for a further 21 years was lodged on 26 May 19982. ML 1923 expires on 31 March 2006. [4] In his submissions, Mr Ambrose SC stated the Applications seek the inclusion of surface area, in relation to ML 1789, for the purpose of mining coal and hydrocarbon and associated infrastructure and, in relation to ML 1923 for infrastructure. There are discrepancies between the infrastructure disclosed in the applications and in the affidavit material. There is also a difference between the purpose described in the applications and those set out in the Certificates of Application issued by the Mining Registrar at Emerald. Section 269 (4) criteria: [5] In taking account of and considering the criteria specified in section 269(4), I have relied upon the material referred to above. The following reasons refer to the salient points but not to all the evidence that was considered. Section 269(4)(a) - Have the provisions of the Act been complied with? [6] When refusing the application to dispense with a hearing, I concluded that the Applicants had complied with the provisions of Part 7 of the Act relating to the applications3. It is unnecessary for me to canvass that matter further. [7] Mr Hanson has confirmed that all the infrastructure referred to in the material was constructed prior to these applications being concluded. Some was constructed many years ago, with the environmental dam on ML 1782 constructed in 1982. Most of it was, however, constructed during the last decade in association with the development of the Crinum mine. [8] I note Mr Hanson’s concession that there has been a non-compliance with the Act in relation to both surface areas4. I have not sought to determine whether the construction of this infrastructure constituted an offence under the Act or any other legislation. Mr Ambrose submitted that it would be wrong to find that a breach of the Act had 2 Accordingly, if the conditions of s286(8) of the Act are fulfilled, the lease continues in force until the application to renew the lease is withdrawn, rejected or granted. 3 [2001] QLRT 48 at [2] 4 Affidavit of Shane Hansen filed 31 August 2000 para 38 -- 3 of 9 -- occurred. I consider that, given my function in these proceedings, it is unnecessary for me to make such a finding5 despite the concession in the Applicant’s material. [9] In my earlier decision in these proceedings, I expressed the view that the construction of the infrastructure without a mining lease may be unauthorised mining and a matter that I must consider in relation to the criteria in s269(4)(a) and also in relation to the Applicants’ past performance6. Mr Ambrose submitted that a breach of s402 is not relevant to the criterion set out in s269(4)(a), because of the interpretation of that section by the Court of Appeal in ACI Operations P/L v Quandamooka Lands Council Aboriginal Corp7. Whilst the words of the section are not so limited, the Court of Appeal has determined that s269(4)(a) refers to all the provisions of the MRA which could apply to an application for the grant of a mining lease. As s402 could not be so described, I have not considered the question of unauthorised mining in relation to s269(4)(a). [10] There is one further submission that Mr Ambrose made in relation to that section that should be addressed. That is, that I should not find “that s269(4)(a) has not been complied with”8. I consider this misconceives my function in making a recommendation to the Minister. The matters set out in s269(4) are not thresholds that the Applicants must meet before a positive recommendation can be made. Nor can I make a determination that the Applicants have complied or not complied with them. Many are expressed in terms that make it clear that I cannot do so. Rather, I am required to consider those matters in assessing the application and in deciding what my recommendation should be. Section 269(4)(b) - Is the land applied for mineralised or are the other purposes for which the lease is sought appropriate? [11] The applicants propose to mine part of the additional surface area for ML 1789. Mr Hanson estimates that there are in situ reserves in the area applied for of approximately 405,000 tonnes. Surface rights are required because of the expected subsidence. He also advised me during the hearing that, were the application not granted, reserves in the order of 5.3 million tonnes to the west of the additional surface area would be 5 see ss268 & 269 in relation to the Tribunal’s function 6 s269(4)(g) 7 [2001] QCA 119 at paras 68 & 73 8 Mr Ambrose’s Submissions in Support of the Application para 20 -- 4 of 9 -- sterilised. This is because the proposed underground mining panels run underneath the area applied for and it would not be feasible to mine the reserves to the west were the additional surface area not included. I am satisfied that the area is mineralised. [12] The other purpose for the additional surface area for ML 1789 is infrastructure and this is the only use purpose proposed for the additional surface area for ML 1923. It is clear from the material that the infrastructure constructed on both additional surface areas is associated with and is necessary for the ongoing operation of the Gregory and Crinum mines. Much of the infrastructure is designed to enable the Applicants to manage the environmental impacts of their operations. I consider this purpose to be appropriate. [13] As I have already noted, there are discrepancies between the purposes as described in the applications and as described in the Certificates of Application issued by the Mining Registrar. The Certificates of Application refer to mining coal and gaseous hydrocarbons and make no reference to infrastructure. In my view, not all the relevant infrastructure is captured by the definition of mining9. Mr Ambrose submitted that the purpose had to be the same as that described in the original mining leases. As I was not provided with the mining leases, I am unable to ascertain whether they are the same. Mr Ambrose did not refer me to any sections of the Act that require the purpose to be limited to that described in the mining leases. It may well be that incorporating surface area for a different purpose will require a variation to the mining lease. I note that the Act does prescribe a procedure for the Minister’s approval of the addition of other purposes not specified in a mining lease10. I also note that the Integrated Planning Act 1997 does not apply to the use of land authorised under the Mineral Resources Act 198911. In the circumstances, I recommend the Minister consider whether the description of the mining leases should be varied to ensure they are accurate and confer the protection afforded by s319 of the Act. Section 269(4)(c) - If the land applied for is mineralised, will there be an acceptable level of development and utilisation of the mineral resources within the area applied for? [14] I note that the Applicants have applied to renew ML 1789. Whilst the Applicants did not provide discrete figures for the 2 mines, together the Gregory and Crinum mines employ 270 permanent employees, 60 full time equivalent contractors and paid 9 s6A 10 s298(6) -- 5 of 9 -- royalties in the last financial year of approximately $21,600,000. I am satisfied that there will be an acceptable level of development and utilisation of the mineral resources within the area applied for in relation to ML 1789. Section 269(4)(d) – Is the land and the surface area of that land in respect of which the mining lease is sought of an appropriate size and shape? [15] Mr Hansen has stated that the additional surface areas sought are the minimum possible to extract the mineable reserves and to allow for use and maintenance of the required infrastructure. There is no evidence before me to suggest that the size and shape are not appropriate. The maps produced by the Applicants demonstrate that the relevant infrastructure is included within the boundaries of the areas applied for. Section 269(4)(e) - Is the term sought appropriate? [16] The Applicants seek a term concurrent with the mining leases to which the additional areas relate. Indeed, there does not appear to be any other option open to the Applicants. Section 269(4)(f) – Has the Applicant the necessary financial and technical capabilities to carry on mining operations under the proposed mining lease? [17] The parent companies for the Applicants are BHP Billiton Limited and Mitsubishi Development Pty Ltd, which each ultimately hold a 50% interest in the joint venture that operates these 2 mines. The Applicants have established their financial and technical capabilities by their operation of the mines to date. Section 269(4)(g) – Has the past performance of the Applicant been satisfactory? [18] Mr Ambrose conceded that the construction of infrastructure, apparently without legal authorisation, was relevant to the question of past performance. However, he submitted that any adverse inference I might draw should be placed in the context of the Applicants’ otherwise good performance. He also submitted that the past performance need not be faultless to result in a favourable recommendation. [19] I am concerned that neither the Applicants nor the Department regulating these mines has, until now, identified the need for surface area to be secured in order to construct and operate infrastructure that is integral to these two mines. My concern is heightened 11 s319 -- 6 of 9 -- by the length of time over which the construction has occurred (from 1982 to 2000). I do take into account the evidence of the Applicants that, with respect to ML 1789, it appears that they assumed that the surface area was included. I also take into account their evidence that, with respect to ML 1923, there appears to have been some advice to the company that surface area was not required if the infrastructure was located on land owned by the miner (as is the case for these areas). Whether that advice was internal or external, legal or otherwise is not explained. [20] It appears that the Department’s records do not necessarily disclose what surface areas are included in a mining lease. This may explain the Department’s apparent failure to identify the tenure issues when it gave approval to Plans of Operations that disclosed the nature and location of the infrastructure constructed over the years. This is a matter that I consider should be drawn to the Minister’s attention so that appropriate action can be taken to prevent this recurring. [21] I note the difficulties the Applicants have experienced in explaining their lack of authorisation caused, in part, by changes in mine personnel. Nevertheless, the Applicants’ explanations are vague and unsatisfactory. Problems with the Department’s systems cannot excuse the Applicants’ own lack of attention to the legal arrangements for its activities. Nor, I should add, did the Applicants seek to lay any blame with the Department. They did, however, make something of the fact that it was the Applicants, not the Department, that identified the need to amend the tenure arrangements to bring them into compliance. [22] There is no other evidence of unsatisfactory past performance by the Applicants before the Tribunal. Whilst past performance cannot be said to be satisfactory, I do not consider I should recommend against the grant for this reason alone. Section 269(4)(h) – Will any disadvantage result to the holders of existing exploration permit or mineral development licences or existing Applicant for exploration permits or mineral development licences? [23] There are no holders or applicants for relevant tenures who would be affected by the grant. Section 269(4)(i) – Do the operations to be carried on under the authority of the mining lease conform with sound land use management? -- 7 of 9 -- [24] The areas applied for are surrounded by existing substantial mining activities. Further, much of the infrastructure is to minimise and manage the environmental impacts of the existing operations. Section 269(4)(j) – Will there be any adverse environmental impacts, and if so, the extent thereof. [25] The Applicants have already identified the impacts of the infrastructure in an accepted Environmental Management Overview Strategy (EMOS) and have committed to control strategies to minimise those impacts. There is no evidence before the Tribunal that there are any impacts that were not anticipated and deemed acceptable by the Department and the Minister. Mr Roe stated that the control strategies of the EMOS have always been implemented and that there have been no unpredicted environmental impacts. I also note that the environmental conditions for these mines will be subject to review by the Environmental Protection Agency pursuant to the transitional provisions of the Environmental Protection Act 199412. Section 269(4)(k) – Will the public right and interest be prejudiced? [26] There is no evidence that any public right or interest will be prejudiced by the grant. There were no objections to the applications. Section 269(4)(l) – Has any good reason been shown for a refusal to grant mining lease? [27] Other than past performance, which has been dealt with, no other good reason has been shown for refusing the grant. Section 269(4)(m) – Is the proposed mining operation an appropriate land use taking into consideration the current and prospective uses of the land? [28] The current land use is mining. The mineable reserves would allow mining to continue until 2015. The Applicants own the freehold. The infrastructure is already in place and integral to the mines. There is no evidence to suggest a feasible alternative use. Recommendation: [29] I recommend to the Honourable Minister for Natural Resources and Minister for Mines that the area of surface land identified in the Application LXX40047 (additional surface area no 2) be included in Mining Lease 1789. 12 Ch 13 Part 2, in particular s 595 -- 8 of 9 -- [30] I recommend to the Honourable Minister for Natural Resources and Minister for Mines that the area of surface land identified in the Application LXX40050 (additional surface area no 3) be included in Mining Lease 1923. -- 9 of 9 --