Rehabilitation Costs and the Chain for Responsibility Reforms
On 15 March 2016 the Environmental Protection (Chain of Responsibility) Amendment Bill 2016 (the Bill) was introduced into the Queensland Parliament. The purpose of the Bill is to amend the Environmental Protection Act 1994 (EP Act) to:
- facilitate enhanced environmental protection for sites operated by companies in financial difficulty; and
- avoid the State bearing the costs for managing and rehabilitating sites for financial difficulty. (Explanatory Notes p1)
This Bill seeks to ensure that companies in financial difficulty continue to comply with environmental obligations and bear associated management and rehabilitation costs without these burdens falling on the taxpayer.
These changes following the recent moratorium on underground coal gasification (UCG) projects and the prosecution of Linc Energy for alleged breaches of the EP Act relating to its UCG trial near Chinchilla.
Importantly the Bill seeks to extend liability for environmental compliance under the EP Act to ‘related persons’. The Bill proposes to define ‘related persons’ as 1. a holding company of the company, 2. a person deemed by the Department to have a ‘relevant connection’ to the company, or 3. a person who owns land on which the company carries out relevant activities, which includes landowners, native title holders and leaseholders regardless of whether the owner has undertaken the activities themselves.
While P&E Law welcomes the expansion of liability for rehabilitation costs to holding companies and people with ‘relevant connections’ to the company, we do not agree with the extension of liability to owners of land. This is particularly concerning in the context of CSG mining, where gas companies do not usually own the land that they develop. This could lead to perverse outcomes if landowners were held to be liable for a mining or gas company’s failure to comply with obligations under an Environmental Authority and be required to undertake costly rehabilitation activities or pay money to the Department.
The Agriculture and Environment Committee was appointed by the Legislative Assembly to examine the Bill and provide comments and recommendations in relation to it. One of the key recommendations made by the Committee that P&E Law strongly agree with is to de-list owners of land as ‘related persons’ under the Bill. This is an important amendment to ensure landowners are protected from liability under the EP Act.
P&E Law will continue to monitor the progress of the Bill to ensure this recommendation is adopted.