CRA Exploration Pty Ltd, Re [1992] QMW 45

REPORT AND RECOMMENDATION OF WARDEN PURSUANT TO SECTION 7.27 OF THE MINERAL RESOURCES ACT, 1989-1990. IN THE MATTER OF: APPLICATION FOR ADDITIONAL SURFACE AREA MINING LEASE NUMBER 4042 IN THE MAREEBA MINING DISTRICT. APPLICANT: CRA EXPLORATION PTY LIMITED. OBJECTORS: NIL REPORT. The Applicant is the holder of Mining Leases number 4042 and 4130 (which were Mining Leases numbers 6272 and 6840 respectively in the former Mining District of Herberton). Mining Lease 5107 (Herberton) over a strip of land generally 5 metres in width intersecting both Mining Leases was applied for previous to the applications for the other Mining Leases and was granted after the lodgement of Mining Lease Application 6272 (4020) and before the lodgement of Mining Lease Application 6848 (4130). Mining Lease 5107 has since been surrendered and the Applicant, in the belief that the land beneath the surface forms part of its Mining Leases, now applies for inclusion of the surface land in those Mining Leases. In my view some features of the grant of the Mining Leases should be closely scrutinised as they cast some doubt on whether the surface of the land is available for addition to the Applicant's Mining Leases. In particular, I draw attention to the following matters: 1. All the Mining Leases were applied for under the provisions of the Mining Acts 1898 - 1967 but, as they were not granted at the commencement of the Mining Act of 1968 were deemed to be applications made under the latter Act as it stood before the commencement of the Mining Act Amendment Act (No3) of 1976. Section 21 of the Mining Act of 1968 gave the Governor in Council discretionary power to grant a Mining Lease to an applicant therefor. As such power was given "subject to the Act" it was, dependent on the Minister's first recommending the application for grant. (Section 21(4)). However, the Executive Council was not bound to the Minister's recommendation: The application could be rejected and; as the power of grant was given "subject to the Act", and thus confined to the application, as made; the applicant could not be given a grant of more land than that applied for and, it is doubtful, of any lesser part of that land. Regulation 34 of the Mining Regulations of 1971 required an application for Mining Lease to contain a full and [1992] QMW 45 -- 1 of 9 -- accurate description of the land applied for. In general terms, "land" includes the surface of the land and everything beneath the surface. It was open to an applicant for Mining Lease to describe part only of the land (e.g. the surface) as the land applied for and be granted a lease over that part of the land, but it is doubtful that the Minister had power to recommend the grant, and the Governor in Council power to grant, a lease for any lesser part of the land applied for. The concept of application for and/or grant of part of the land was not introduced into the Mining Act until advent of subsection (10) of section 21 (and other amendments to that section) which required an applicant to identify the part of the surface of the land applied for. Section 21(1) permitted the Minister to recommend grant in respect of the whole or part of the land the subject of the application; something not specifically provided for previously. Indeed, there seemed to be before that time no statutory distinction drawn between the entitlements attaching to a mining lease granted for the winning of minerals and that granted for any other purpose. Indicative of this was section 35 of the Mining Act which did not clearly prevent a mining lease issued for another purpose to be varied to permit the winning of minerals. (Contrast the clear prohibition much later in section 7.53 of the Mineral Resources Act of 1989). 2. Mining Lease 5107 (Herberton) for the purpose of constructing a pipeline was applied for by Tableland Tin Dredging No Liability on the 24th April, 1967. There was no mention in the application form that the Application was restricted to surface of the land only. In a later amended Application (lodged on the 29th June, 1967) the metes and bounds description was followed by the statement, "The ground will be used for laying a pipeline on the surface." The contents of the application form did not otherwise indicate that the Application was for other than the whole of the land applied for. The is no record on the District Office file of the Minister's determination to recommend grant of the Mining Lease Application. The Mining Lease was granted under the provisions of the Mining Act of 1968 on the 31st January, 1974. There was no mention in the Grant whether it was for the whole or part of the land applied for. An instrument of lease was not issued. 3. I doubt that the statement that the land will be used for laying a pipeline on the surface can be properly construed as an application for only the surface part of the land. It was merely a statement of the intended use of the land at the time the statement was made. It cannot be claimed that because the part of the land below the surface was not excluded from the land description made pursuant to -- 2 of 9 -- Regulation 34 such description was so inconsistent with the proposed purpose of the Mining Lease that it should be read down to avoid that inconsistency. This is because no inconsistency, in fact, exists. Under the legislation of the time it was open to a lessee to add mining of minerals as a purpose, and it is conceivable that the applicant wanted to leave that option open. Furthermore, nature of the intended construction would make it not simply conjecture to say that the applicant for Mining Lease 5107 may have had good reason for securing the land below the surface of the land. 4. Mining Lease 6272 (Herberton) was applied for on the 22nd October, 1970 and by letter dated 19th November, 1970. The Warden advised the Applicant of the encroachment on Mining Lease Application 5107 and stated "but as this is a surface lease the underground rights would be available." The Applicant responded by letter dated 19th November, 1970 stating that "this Company would be desirous of taking up the underground rights". The District Office file records the Minister's Determination to recommend grant of the Mining Lease. The Mining Lease was granted under the provisions of the Mining Act of 1968 on the 25th October, 1973 subject to the special condition recommended by the Minister that part of Mining Lease Application 5107 Herberton (surface lease) shall be excluded from the lease. 5. Mining Lease 6840 (Herberton) was applied for on the 16th May, 1974 and by letter dated 31st July, 1974 the Warden informed the Applicant of the encroachment on (then) Mining Lease 5107 and advised, "...but as this is a surface lease the underground rights would be available." The Applicant's response on the 9th August, 1974 was, "...it is requested that our Mining Lease application be granted subject to that part of Mining Lease No. 5107 over which we have encroached being excluded from our lease." The District Office file has no record of the Minister's recommendation to the Governor in Council The Mining Lease was granted under the provisions of the Mining Act of 1968 on the 13th February, 1975. There was no mention in the Grant whether it was for the whole of part of the land applied for. No instrument of lease has been issued. There is no doubt that the grants of Mining Leases 4042 and 4130 purport to include the land below the surface of former Mining Lease 5107. In my view, however, former Mining Lease 5107 was granted for the whole of the land applied for and, that being the case, the land beneath the surface was not available to the later Mining Leases. I come to this conclusion for the following reasons: (1) The description of the land applied for in Mining Lease -- 3 of 9 -- Application 5107 did not refer to part only of the land within the described boundaries as being subject to the Mining Lease Application. (2) The statement that the Mining Lease was required for the purpose of laying a pipeline on the surface is not conclusive that the application was intended as a lease of the surface only. I recommend that the question of availability of the surface land applied for be given further consideration in light of Central Office records and, if considered necessary, the advice of the Solicitor-General be sought. This Application is for the inclusion of an additional surface area of .457 hectares in the mining lease for the purpose of mining cadmium, cobalt, copper, molybdenum, lead and zinc. The Applicant is the holder of the Mining Lease which is situated close to the southern outskirts of Mount Garnet township. The term of lease expired on 31st October, 1991 and renewal for a further term of 21 years has been applied for. The Application was lodged at the Mining Registrar's Office at Mareeba on the 13th July, 1992 and a certificate of application was issued on the same day setting the last date for receipt of objections as the 10th August, 1992. An objection was lodged by the Herberton Shire Council and subsequently conditionally withdrawn. The following matters have been taken into account and considered by me in making my recommendation: (A) HAVE THE PROVISIONS OF THE MINERAL RESOURCES ACT BEEN COMPLIED WITH? The material indicates that the Applicant is an eligible person. A road traverses the land applied for. The authority responsible for the maintenance of the road would appear to be the Herberton Shire Council. It can be inferred from the Council's withdrawal of its objection that consent to inclusion of that part of the surface land has been given. I accept, on the material before me, the Application is not otherwise in respect of land over which, pursuant to Section 7(6) of the Mineral Resources Act, 1989-1990, a mining lease shall not be granted without the consent of another person or persons. The Mining Registrar dispensed with the requirement to mark out the ground applied for. I have been informed by him orally that the dispensation was given on the basis that the -- 4 of 9 -- existence of survey marks made such marking out impracticable. A declaration of posting was lodged on the 19th August, 1992 and I am satisfied on the material, including the uncontested information in the application form and the declaration of posting and advertising that all the provisions of the Mineral Resources Act, 1989-1990 (other than the provisions requiring the hearing) have been substantially complied with. The hearing is dispensed with pursuant to section 7.27 of the Act. (B) IS THE LAND APPLIED FOR MINERALISED OR IS THE OTHER PURPOSE FOR WHICH THE LEASE IS SOUGHT APPROPRIATE? The Applicant intends to develop this and a number of other contiguous mining leases in a major mining operation. Information tendered in support of the Application indicates that a tailings dam is likely to be established over a substantial part of the land applied for. The Applicant presently plans to establish its central treatment plant on ML 4042. Haul roads and other infrastructure associated with general mining activity will be established on the surface of the land applied for. The Applicant advises that the land is relatively flat. In view of the Applicant's advice I am satisfied that the land applied for is mineralised. I am also satisfied, on the information given by the Applicant, that the other purposes for which the surface land is sought are appropriate. (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? The advice received in support of the application indicates that work on development research and planning will commence in early 1993 and proceed for the rest of the year on a full time basis. Post 1993 development will depend on results of that research. In my view, on the information supplied by the Applicant, there will be an acceptable level of development and utilisation of the mineral resources beneath the area applied for. (D) IS THE LAND AND THE SURFACE AREA OF LAND IN RESPECT OF WHICH THE MINING LEASE IS SOUGHT OF AN APPROPRIATE -- 5 of 9 -- SIZE AND SHAPE? The surface applied for consists of a strip of land 5 metres wide which was held under Mining Lease 5107 and not available to the Applicant at the time the Mining Lease was applied for. There is nothing in the information supplied by the Applicant to suggest that the surface area of the land in respect of which the mining lease is sought is not an appropriate size and shape. (E) IS THE TERM SOUGHT APPROPRIATE? It is not necessary to enquire into the suitability of the term of lease applied for. The Mining Lease exists for a term which expires on 31st October, 1991. The Applicant has applied for renewal of the lease for a period of 21 years from 1st November, 1991. The term should coincide with the renewed term of lease. (F) HAS THE APPLICANT THE NECESSARY FINANCIAL AND TECHNICAL CAPABILITIES TO CARRY ON MINING OPERATIONS UNDER THE PROPOSED MINING LEASE? Evidence has been produced in relation to the financial and technical capabilities of CRA Exploration Pty Limited to carry on mining operations under the proposed lease. In view of the nature of the Application and the fact that the Application relates to a granted Mining Lease I consider it is sufficient to note here that the Applicant is a wholly owned subsiduary of a major mining Company, CRA Limited, and appears from the record to have full support, both financially and technically, of the parent Company. I am satisfied that the Applicant has the necessary financial capability and that it has sufficient technical expertise to properly carry on the proposed mining operation under the proposed lease. (G) HAS THE PAST PERFORMANCE OF THE APPLICANT BEEN SATISFACTORY? There is no material before me to suggest that the past performance of the Applicant has been unsatisfactory. (H) WILL THE OPERATIONS TO BE CARRIED ON UNDER THE AUTHORITY OF THE PROPOSED LEASE CONFORM WITH SOUND -- 6 of 9 -- LAND USE MANAGEMENT? The land appears to be used for cattle grazing and it seems the proposed mining operation will not significantly disturb the owners' stock or stock watering and stock management facilities belonging to them. The information given in support of the application suggests that in the operation to be carried on under authority of the proposed mining lease the Applicant will utilise the surface to operate a crushing plant and establish water storage ponds, secondary waste stock pile and tailings storage. The tailings dam is likely to be sited over the additional surface land applied for. The information to hand suggests that a detailed mineral exploration program has not been completed. It seems that once a mineral deposit is finally identified and quantified the mining program will be described in detail in the Plan of Operations and EMOS. (I) WILL THERE BE ADVERSE ENVIRONMENTAL EFFECTS CAUSED BY THE PROPOSE OPERATION, AND IS SO, THE EXTENT THEREOF? The proposed mining activity is on the southern outskirts of Mount Garnet Township. In view of the small amount of surface sought to be added to the Mining Lease, the environmental effects of mining should be addressed in relation to the whole Mining Lease. There appear to be no environmental factors which should require special conditions of lease to govern the general concepts of mining the land applied for, whether by open cut or underground methods. Micro environmental concerns may be addressed in Plans of Operations and EMOS created if and when a mining development occurs. (J) WILL THE PUBLIC RIGHT AND INTEREST BE PREJUDICED? The Herberton Shire Council's objection to the grant of the Mining Lease seems to rely entirely on the ground that the public right and interest will be prejudiced by the grant of the mining lease. The facts and circumstances relied on in support of the ground of objection are not clear, but it appears Council's concerns are that the roads are not adequately equipped to cater for additional wear and tear caused by the transportation of the product of mining and that the Council is unable to bear the cost of the additional road maintenance. I will deal with the matter on the basis that the Council seeks that the Mining Lease be granted on condition that the Applicant contributes to the maintenance of the roads. -- 7 of 9 -- There are two competing public interests in this case. Firstly, the Council's objectives; the imposition of abnormal user contributions for the maintenance and improvement of the road; are, in light of inadequate road funding from other sources, in the public interest. It is equally clear that it is not in the public interest that mining development be stifled only because of the inability of local government to fully provide or maintain support facilities from available funds; or that levies be placed on some heavy road transport operators to the exclusion of other such operators who also use the road, particularly when those operators against whom levies are imposed are required to pay Government charges calculated on gross vehicle mass. Notwithstanding the grounds of the Herberton Shire Council objection and the terms of its subsequent conditional withdrawal I am of the opinion that no factors prejudicial to the public right have been identified. It should be noted, however, that withdrawal of the objection is conditional on the inclusion of the "Council's conditions in the final approval". If it is not intended at this stage to include the Council's proposals as part of the Mining Lease conditions it appears the Application should be remitted to me for hearing. (K) HAS ANY GOOD REASON BEEN SHOWN FOR A REFUSAL TO GRANT THE MINING LEASE? In my view, no good reason has been shown for a refusal to grant the additional surface area. (L) IS THE PROPOSED MINING OPERATION AN APPROPRIATE LAND USE, TAKING INTO CONSIDERATION THE CURRENT AND PROSPECTIVE USES OF THE LAND? The material indicates that the land is currently used for cattle grazing purposes and appears, on the evidence, to be suitable for no other use. In my view, there appears to be no risk of significant conflict between the current land use, or any prospective land use, and the proposed mining operation. The proposed mining operation appears, on the evidence, an appropriate land use, taking into account the current and prospective uses of the land. APPENDICES The following documents are appended: -- 8 of 9 -- * Copy of Declaration of Posting and Advertising; * Copy of Questionnaire lodged by the Applicant with Attachments A, B, C, D, E and F; * Copy of Herberton Shire Council Notice of Objection; * Copy of Herberton Shire Council letter dated 25th August, 1992 conditionally withdrawing the objection. RECOMMENDATION Subject to my recommendation at the outset that further consideration be given to the question of availability of the surface land, I recommend to the Honourable, the Minister that the Application to include the additional surface area in Mining Lease 4042 be granted. Mareeba 29 September 1992 Warden -- 9 of 9 --