General information

Agriculture and resource exploration are both vital industries in NSW, and share many common beliefs and interests. The successful coexistence of these industries has enormous benefits for the state, particularly in regional areas.

While landholders in NSW own the surface land of their properties, most resources that exist below the earth's surface belong to the state of NSW. The production of these resources contributes royalties, economic benefits and energy security for the people of NSW.

The purpose of land access arrangements is to ensure the orderly search for resources, while recognising the rights of landholders to conduct their activities free from unreasonable interference or disturbance. Thousands of access arrangements are successfully negotiated between titleholders and landholders for their mutual benefit.  Very few progress to mediation, arbitration and to the courts.

Both landholders and explorers have clear legal rights regarding access to land for resource exploration.

The Mining Act 1992 and the Petroleum (Onshore) Act 1991 provide specific landholder protections in respect of dwellings, gardens and significant improvements. The legislation also provides a statutory right to compensation for any 'compensable loss' suffered due to exploration carried out under an exploration licence or assessment lease.

The vast majority of relationships between explorers and landholders are positive. Courtesy, respect and honesty go far in building relationships between explorers and landholders.

All access arrangements should be based on the understanding that explorers are 'visitors' on private land, and an appreciation by landholders of the needs and rights of explorers.

On 1 December 2016, reforms to the land access arbitration framework were introduced with the commencement of the Mining and Petroleum Legislation Amendment (Land Access Arbitration) Act 2015. More information on reforms introduced under this legislation is available at:

Land access information under the Mining Act 1992

On 1 December 2016, the Mining and Petroleum Legislation Amendment (Land Access Arbitration) Act 2015 was commenced to reform the land access arbitration framework. It introduced a range of improvements in line with recommendations of the 2014 Walker Report. Read more about the Walker Report.

Part 1: Exploration licences and assessment leases

Access arrangements

The holder of a prospecting title (an exploration licence or an assessment lease) may not carry out any prospecting operations other than in accordance with an access arrangement with the landholder or landholders of the land (section 140).

Holders of prospecting titles who wish to enter into access arrangements may serve written notice on each landholder in order to notify them of their intention to seek an access arrangement.

Access arrangements must be agreed in writing with each landholder. An access arrangement may make provision for a range of matters which are set out in section 141 of the legislation. Matters include:

  • periods during which the holder of the prospecting title is to be permitted access to the land
  • parts of the land in or on which the holder of the prospecting title may prospect and the means by which the holder may gain access to those parts of the land
  • the kinds of prospecting operations that may be carried out in or on the land
  • conditions to be observed by the holder of the prospecting title when prospecting in or on the land
  • compensation to be paid to any landholder of the land as a consequence of the holder of the prospecting title carrying out prospecting operations in or on the land
  • the manner of resolving any dispute arising in connection with the arrangement
  • the manner of varying the arrangement
  • notification to the holder of the prospecting title of particulars of any person who becomes an additional landholder, for example, where the land owner leases out part of the land subject to the access arrangement, they are required to inform the prospecting title holder.

Separate access arrangements can also be made for different areas of the same landholding, or for different matters. Separate access arrangements may also be made to preserve confidentiality of provisions in the arrangements and to deal with persons becoming landholders at different times, for example a land owner leasing out some of the land after the arrangement has been entered into (section 140).

If the holder of a prospecting title contravenes an access arrangement, a landholder may deny the title holder access to the land until:

  1. the title holder ceases the contravention

    or

  2. the contravention is remedied to the reasonable satisfaction of, or in the manner directed by, an arbitrator appointed by the Secretary.

Dispute resolution

Changes to the Mining Act 1992 which commenced in 2016 introduced a clearer pathway for the resolution of land access disputes.

Framework

If an access arrangement cannot be agreed during private negotiations between a titleholder and a landholder, the next step is mediation. The holder of the prospecting title may, through written notice to the landholder or landholders concerned, request their agreement to the appointment of a mutually agreeable mediator or arbitrator to preside over the mediation.

If parties have been unable to agree on an appointment, either party can apply to the Secretary of the Department of Industry, Skills and Regional Development to appoint an arbitrator from the Minister for Resources' panel of arbitrators. This option is available to parties at both mediation and arbitration.

If agreement is not reached at mediation, parties proceed to arbitration where the arbitrator will make a final determination. This determination may be appealed in the Land and Environment Court.

Both parties have an express right to legal representation at mediation and arbitration. The arbitration process is covered by sections 143 to 158B.

Read more about the arbitration process for access to lands for exploration.

Costs of landholder participation in land access negotiations

In line with the recommendations of the Walker Report, the Act requires the holder of the prospecting title to pay the reasonable costs of a landholder’s participation in negotiating the access arrangement (section 142).

To ensure these costs do not become uncontrollable at the stage of negotiation, they have been capped at $1,500 for exempt prospecting operations and $2,500 for assessable prospecting operations (both exclusive of GST). The explorer must pay the GST amount in addition to the landholder’s capped costs. Caps are set out in a Ministerial Order published in the NSW Gazette.

No cap has been set on the reasonable costs payable by an explorer at mediation and arbitration as these processes can vary substantially depending on the circumstances. The explorer must still cover the landholder’s costs in making the access arrangement during these stages of the process.

The particulars of each case at mediation and arbitration are to be considered in the determination of reasonable costs at these stages. Nothing in the legislation prevents a titleholder from paying an amount above these caps. If parties cannot come to an agreement on reasonable costs, the arbitrator or the courts will make this determination.

Sections 142, 145A and 148 require both parties to act in good faith. Landholder conduct can be taken into account when determining the reasonable costs payable by the explorer, and there are requirements under the legislation that both parties must act in good faith. This is to encourage all parties to arrive at a land access arrangement as efficiently and reasonably as possible (section 151A).

Read more on costs.

General immunity of landholders

The Mining Act 1992 provides landholders with general immunity against actions arising as a consequence of the actions of title holders on their land. This is provided in section 383C of the legisaltion.

Compensation

On the granting of a prospecting title, landholders, including secondary landholders, become entitled to compensation for any "compensable loss" suffered, or likely to be suffered, as a result of the exercising of rights conferred by the title (sections 263 and 264).

Land access arrangements can set out compensation to be paid to landholders as a consequence of carrying out exploration activities on the land. However, if situations arise which are not covered in access arrangements, landholders are entitled to seek further compensation.

"Compensable loss" is defined as loss caused, or likely to be caused, by (section 262):

(a)  damage to the surface of land, to crops, trees, grasses or other vegetation (including fruit and vegetables) or to buildings, structures or works, being damage which has been caused by or which may arise from prospecting or mining operations, or
(b)  deprivation of the possession or of the use of the surface of land or any part of the surface, or
(c)  severance of land from other land of the landholder, or
(d)  surface rights of way and easements, or
(e)  destruction or loss of, or injury to, disturbance of or interference with, stock, or
(f)  damage consequential on any matter referred to in paragraph (a)–(e),

Compensable loss does not include loss that is compensable under the Mine Subsidence Compensation Act 1961.

Compensation need not always be monetary in nature. Often what is provided in-kind by the explorer may be worth more than the actual monetary compensation. For example, the explorer might agree to upgrade a farm road, renew a fence or replace a gate with a cattle grid.

Significant improvements

The holder of a prospecting title may not exercise the rights conferred by that title over the surface of the land (carry out prospecting activities) within:

  • 200 metres of a dwelling house that is the principal place of residence of the person occupying it,
  • 50 metres of a garden or
  • over any significant improvements

unless with the written consent of the owner of the dwelling house, garden or significant improvement (and in the case of the dwelling house, the written consent of its occupant).  Any dispute may be referred to the Land & Environment Court for inquiry and determination on the matter. The prospecting titleholder is to pay the costs of the owner’s  court proceedings (sections 31 & 49).

These provisions do not apply if the dwelling-house, garden or significant improvement is owned by the holder of the exploration licence, or if the holder is a corporation, by a related corporation (sections 31 & 49).

On 1 October 2016, a new definition of significant improvements was introduced into the dictionary of the Mining Act 1992 in the form of non-prescriptive, non-exhaustive criteria:

significant improvement on land, in relation to an authorisation or an access arrangement, means a work or structure that:

(a) is a substantial and valuable improvement to the land, and
(b) is reasonably necessary for the operation of the landholder’s lawful business or use of the land, and
(c) is fit for its purpose (immediately or with minimal repair), and
(d) cannot reasonably co-exist with the exercise of rights under the authorisation or the access arrangement without hindrance to the full and unencumbered operation or functionality of the work or structure, and
(e) cannot reasonably be relocated or substituted without material detriment to the landholder, and includes any work or structure prescribed by the regulations for the purposes of this definition, but does not include any work or structure excluded from this definition by the regulations.

Read the guidance material on the definition of significant improvements.

Part 2: Mining leases

Planning approval

A mining lease can only be granted over land for which there is an appropriate development consent in place under the Environmental Planning and Assessment Act 1979 (section 65).

Development consent for mining projects of State significance is given by the Minister for Planning, other development consents may be issued by Councils in accordance with Part 4 of the Environmental Planning and Assessment Act 1979.

The development consent process includes an exhaustive environmental assessment.

When an application for development consent is lodged, advertisements are placed in newspapers circulating in the surrounding area.

These advertisements provide details of where the development consent application can be obtained (websites, local Council offices etc) and invite submissions regarding the application.  Submissions have to be taken into account when the consent authority determines the application.

If landholders have concerns regarding the proposed mining operation and its impacts, they should make submissions outlining their concerns to the consent authority, as prescribed in the advertisement.

Claims of significant improvements

Within 21 days of lodging an application for a mining lease which includes the surface of the land, the applicant is required to serve notice of the application on all landholders affected by the application.

Under clause 23A of Schedule 1 of the Act, a landholder may make a claim that something on the land to which the application for a mining lease relates is a significant improvement. The claim must be submitted in writing to the Secretary of the Department of Industry, and must provide details of the improvements being claimed.

All claims of significant improvements by landholders are referred to the mining lease applicant who is entitled to seek a determination from the Land and Environment Court as to the validity of the claim.

If the Land and Environment Court determines that a significant improvement exists, a mining lease cannot be granted over the significant improvement without the written consent of the landholder (s.62 (1)(c)).

Exclusion of houses, gardens and significant improvements

A mining lease may not be granted over the surface of any land within:

  • 200 metres of a dwelling house that is the principal place of residence of the person occupying it,
  • 50 metres of a garden or
  • over any significant improvements

unless with the written consent of the owner of the dwelling house, garden or improvement (and in the case of the dwelling house, the written consent of its occupant) (section 62).

In order to be afforded the protection provided by section 62, houses, gardens and significant improvements must have been in existence prior to the relevant date, as defined in section 62(5).

Importantly, it should be noted that the value of any houses, gardens or significant improvements constructed or developed after the relevant date, still have to be taken into account when determining the property value, should a mining proponent wish to purchase the land.

This section does not apply with respect to a dwelling-house, garden or significant improvement owned by the applicant for the mining lease, or, if the holder is a corporation, by a related corporation.

Access to the surface of a mining lease or the surface above a mining lease

Once a mining lease is granted, the holder may not exercise any rights under the lease on the surface of any land without a valid compensation agreement (section 265).

The holder of a mining lease that does not include the surface (an underground mining lease) may carry out prospecting operations and construct drill holes or shafts to allow certain activities required for the operations of the mine, without a mining title over the surface.

Consent of the landholder is however required in these circumstances (section 81).

Compensation

On the granting of a mining lease, landholders, including secondary landholders, become entitled to compensation for any "compensable loss" suffered, or likely to be suffered, as a result of the exercising of rights conferred by the title (sections 265).

This provision applies to landholders regardless of whether their land is within the area of the mining lease or not.

"Compensable loss" is defined as loss caused, or likely to be caused, by (section 262):

(a)  damage to the surface of land, to crops, trees, grasses or other vegetation (including fruit and vegetables) or to buildings, structures or works, being damage which has been caused by or which may arise from prospecting or mining operations, or
(b)  deprivation of the possession or of the use of the surface of land or any part of the surface, or
(c)  severance of land from other land of the landholder, or
(d)  surface rights of way and easements, or
(e)  destruction or loss of, or injury to, disturbance of or interference with, stock, or
(f)  damage consequential on any matter referred to in paragraph (a)–(e),

but does not include loss that is compensable under the Mine Subsidence Compensation Act 1961.

The holder of a mining lease may agree with a landholder as to the amount of compensation payable. Note compensation need not always be monetary in nature. What is provided in-kind may be worth more than the actual monetary compensation. For example, the titleholder might agree to upgrade a farm road, renew a fence or replace a gate with a cattle grid.

Such an agreement must be in writing and be signed by both parties.  If agreement cannot be reached, the landholder may seek a determination of the matter by the Land & Environment Court.

Land access information under the Petroleum (Onshore) Act 1991

On 1 December 2016, reforms to the land access arbitration framework were introduced with the commencement of the Mining and Petroleum Legislation Amendment (Land Access Arbitration) Act 2015. This legislation introduced a range of improvements to the land access arbitration framework in line with recommendations of the 2014 Walker Report. Read more about the Walker Report.

The reforms are also part of the Government’s movement to harmonise the regulation of all resources, including minerals and petroleum. Landholder rights including in relation to access arrangements, dispute resolution, significant improvements and the payment of landholder costs in negotiating a land access arrangement are therefore aligned with those outlined in the section on the Mining Act 1992.

General information is provided below where those rights and obligations differ between the Mining Act 1992 and the Petroleum (Onshore Act) 1991.

Part 1: Prospecting titles

There are different types of petroleum prospecting titles in NSW. They are Petroleum Exploration Licences, Petroleum Special Prospecting Authorities and Petroleum Assessment Leases. Petroleum Special Prospecting Authorities can be granted for periods of up to one year, and all other petroleum prospecting titles can be granted for terms up to six years.

Exploration Code of Practice: Petroleum Land Access

An exploration code of practice was introduced on 1 December 2016 for holders of petroleum prospecting titles under section 69DA of the Petroleum (Onshore)Act 1991 and clause 16A of the Petroleum (Onshore) Regulation 2016. This code contains mandatory provisions which petroleum prospectors must adhere to. It also outlines best practice guidance to assist explorers in negotiating land access arrangements.

Easements and rights of way

The Minister may, at his discretion, grant temporary rights of way for the construction of access roads to the land comprised in a petroleum title. The Minister may, from time to time vary or revoke any grants under section 106.

The Minister may not grant consent under section 106 in respect of lands within a state recreation area (National Parks & Wildlife Act 1974):

  • without the concurrence of the Water Administration Ministerial Corporation where the lands concerned are within an irrigation area (Crown Land Act 1989) and the Lands Administration Ministerial Corporation constituted by section 13 of the Crown Lands Act 1989, and
  • without the concurrence of the Minister administering the National Parks & Wildlife Act 1974, in any other case.

Part 2: Production leases

Access arrangement required before production can commence

Section 69X requires holders of petroleum production leases to negotiate a land access arrangement with a landholder before the rights afforded by that title can be exercised. That access arrangement must specify the compensation that is payable to the landholder (section 69D(2)).

Protection of cultivated lands

The holder of a petroleum production lease must not carry out any mining operations or erect any works on the surface of any land, which is under cultivation except with the consent of the landholder (Section 71).

The Minister may, if warranted, define an area of cultivated land where mining operations may be carried out or works may be erected. However, before any such operations commence or works are erected, compensation is to be agreed between the landholder and the holder of the production lease.  If agreement is not reached, either party may request the Land and Environment Court to assess the amount of compensation for any loss or damage to any crop on the land concerned.

Cultivation for the growth and spread of pasture grasses is not taken to be cultivation within the meaning of Section 71 unless, in the Minister’s opinion, the circumstances so warrant. In the case of dispute as to whether land is or is not under cultivation, the Minister’s decision is final.

Agreed principles of land access

The Agreed Principles of Land Access was signed in March 2014 by gas companies Santos and AGL, and by landholder representatives NSW Farmers, Cotton Australia and the NSW Irrigators Council. The document is a landmark agreement on land access for Coal Seam Gas (CSG) operations in NSW that continues in force today. In September 2015, the Country Women’s Association and Dairy Connect became signatories to the Agreed Principles of Land Access.

All parties agreed to the following principles:

  • Any Landholder must be allowed to freely express their views on the type of drilling operations that should or should not take place on their land without criticism, pressure, harassment or intimidation. Any Landholder is at liberty to say "yes" or "no" to the conduct of operation on their land
  • Santos and AGL confirm that they will respect the Landholder's wishes and not enter onto a Landholder's property to conduct drilling operations where that Landholder has clearly expressed the view that operations on their property would be unwelcome; and
  • The parties will uphold the Landholder's decision to allow access for drilling operations and do not support attempts by third party groups to interfere with any agreed operations. The parties condemn bullying, harassment and intimidation in relation to agreed drilling operations.

These principles apply at both petroleum prospecting and production. Read the Agreed Principles of Land Access.

For further information
Mineral Resources
Phone:
1300 736 122 (toll free) or +61 (0)2 4931 6666
Fax:
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minres.webcoordinator@industry.nsw.gov.au
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Mineral Resources, NSW Department of Industry, Resources & Energy, PO Box 344 Hunter Regional Mail Centre NSW 2310
Office:
516 High Street Maitland NSW 2320 Map