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.
Thousands of land access arrangements are successfully negotiated between titleholders and landholders for their mutual benefit. Very few progress to mediation, arbitration or to court. At the time of the Walker Review of the NSW land access arbitration framework, there were only six cases in arbitration.
The NSW Government is committed to ensuring it has the balance right with the regulation of land access matters. The framework under the Mining and Petroleum Legislation Amendment (Land Access Arbitration) Act 2015 offers a fairer, more efficient, consistent and transparent land access arbitration process for all parties.
The Act was passed by NSW Parliament in 2015, but its commencement was delayed to allow further consultation on the reforms. Stakeholder feedback was considered in the second half of 2016, and the legislation commenced on 1 December 2016.
The reforms implement the legislative components of the recommendations in the Walker report on land access arbitration.
Recognising that land access is inherently complex with diverging views across stakeholders, the NSW Government committed to a six month review of the operation of the land access framework after its commencement on 1 December 2016. This review will provide an opportunity for stakeholders to provide feedback about how the framework is operating.
Key features of the arbitration framework under the new legislation include:
- a clearer pathway for the resolution of land access disputes by requiring negotiation and mediation to take place before arbitration
- guidance on timeframes and processes for each stage of the arbitration framework set out in the gazetted Land Access Arbitration Procedure
- a rigorous selection process for arbitrators on the Minister’s Arbitration Panel and the introduction of performance measures
- reasonable costs of landholder participation in land access negotiations to be met by the explorer
- the requirement for both parties to act in good faith and the ability for landholder conduct to be considered when the arbitrator or courts determine the reasonable costs payable by the explorer
- clearer guidance on 'significant improvements'
- the use of legal representation and site inspections.
Specific reforms were made under the Petroleum (Onshore) Act 1991 to implement actions under the NSW Gas Plan. These include the:
- introduction of a land access code of practice for petroleum explorers
- requirement for access arrangements to specify the compensation payable to landholders before any exploration on the land can commence
- requirement for access arrangements including agreed compensation to be in place before petroleum production on the land can commence.