Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Link to this | Hansard source

by leave—I present a supplementary explanatory memorandum and move government amendments (1) to (93):

(1)    Clause 2, page 1 (line 8) to page 8 (line 3), omit subclause (1), substitute:

        (1)    Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

Commencement information
Column 1	Column 2
Provision(s)	Commencement
1.  Sections 1 to 3 and anything in this Act not elsewhere covered by this table	The day on which this Act receives the Royal Assent.
2.  Schedule 1	The day after this Act receives the Royal Assent.
3.  Schedule 2	Immediately after the commencement of the provision(s) covered by table item 2.
4.  Schedule 3	The day after this Act receives the Royal Assent.
5.  Schedule 4, Part 1	Immediately after the commencement of the provision(s) covered by table item 3.
6.  Schedule 4, Part 2	Immediately after the commencement of the provision(s) covered by table item 4.
7.  Schedule 4, Part 3	Immediately after the commencement of the provision(s) covered by table item 3.

Note:       This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

(2)   Schedule 1, page 9 (after line 15), after item 2, insert:

2A  After section 2

Insert:

2A  Object

                 The object of this Act is to provide an effective regulatory framework for:

             (a)    petroleum exploration and recovery; and

             (b)    the injection and storage of greenhouse gas substances;

in offshore areas.

(3)   Schedule 1, page 13 (after line 11), after item 14, insert:

14A  Section 6

Insert:

designated agreement has the meaning given by section 15J.

(4)    Schedule 1, page 13 (after line 25), after item 15A, insert:

15B  Section 6

Insert:

expert advisory committee means a committee established under section 435A.

15C  Section 6

Insert:

expert advisory committee member means a member of an expert advisory committee, and includes the Chair of an expert advisory committee.

(5)    Schedule 1, page 21 (after line 16), after item 49, insert:

49A  Section 6

Insert:

original greenhouse gas assessment permit means a greenhouse gas assessmentpermit that was granted otherwise than by way of renewal.

(6)    Schedule 1, item 79, page 27 (line 12), after “in relation to a”, insert “greenhouse gas assessment permit or”.

(7)    Schedule 1, item 81, page 27 (line 20), omit “15E”, substitute “15F”.

(8)    Schedule 1, page 27 (after line 28), after item 83, insert:

83A  Section 6

Insert:

spatial extent of an eligible greenhouse gas storage formation has the meaning given by subsection 15B(3).

(9)    Schedule 1, page 28 (after line 21), after item 87, insert:

87A  Section 6

Insert:

tied, in relation to a greenhouse gas holding lease or greenhouse gas injection licence, has the meaning given by section 11A.

(10)  Schedule 1, item 98, page 31 (line 6), omit “holding lease”, substitute “titles”.

(11)  Schedule 1, item 98, page 31 (before table item 1), insert:

1A

the renewal, or the grant of a renewal, of a greenhouse gas assessment permit

the grant of a greenhouse gas assessment permit over all of the blocks in relation to which the permit mentioned in column 1 was in force, to begin on the day after the expiry date of the permit mentioned in column 1.

(12) Schedule 1, page 32 (after line 5), after item 100, insert:

100A  After section 11

Insert:

11A  Tied titles

Scope

        (1)    This section applies if a greenhouse gas holding lease (the greenhouse gas lease) is granted under section 249BSI to the registered holder of a retention lease (the petroleum lease).

Tied titles

        (2)    For the purposes of this Act, each of the following:

             (a)    the greenhouse gas lease;

             (b)    a greenhouse gas holding lease granted by way of renewal of the greenhouse gas lease;

             (c)    a greenhouse gas injection licence derived from a lease referred to in paragraph (a) or (b);

is tied to each of the following:

             (d)    the petroleum lease;

             (e)    a retention lease granted by way of renewal of the petroleum lease;

              (f)    a production licence derived from a lease referred to in paragraph (d) or (e).

(13)  Schedule 1, item 101, page 32 (table item 11), after “was in force”, insert “but has not been renewed”.

(14)  Schedule 1, item 109, page 36 (line 27) to page 37 (line 1), omit subsection 15B(3), substitute:

Spatial extent

        (3)    For the purposes of this Act, the spatial extent of an eligible greenhouse gas storage formation is the expected migration pathway or pathways, over the period:

             (a)    beginning at the start of the particular period referred to in whichever of paragraph (1)(a) or (b) is applicable; and

             (b)    ending at the notional site closing certificate time;

of the particular amount of the particular greenhouse gas substance injected as mentioned in whichever of paragraph (1)(a) or (b) is applicable.

     (3A)    In determining the spatial extent of an eligible greenhouse gas storage formation, regard must be had to:

             (a)    the fundamental suitability determinants; and

             (b)    such other matters as are relevant.

(15)  Schedule 1, item 109, page 37 (lines 8 to 11), omit subsection 15B(5).

(16)  Schedule 1, item 109, page 37 (line 13), omit “subsection (5)”, substitute “this section”.

(17)  Schedule 1, item 109, page 38 (line 1), omit “subsection (5)”, substitute “this section”.

(18)  Schedule 1, item 109, page 40 (lines 17 to 23), omit section 15F, substitute:

15F  Significant risk of a significant adverse impact

Impact of petroleum operations

        (1)    For the purposes of sections 79A, 79B, 114A, 114B, 138A and 138B and paragraph 435B(2)(a), the question of whether there is a significant risk that a key petroleum operation will have a significant adverse impact on:

             (a)    operations for the injection of a greenhouse gas substance; or

             (b)    operations for the storage of a greenhouse gas substance;

is to be determined in a manner ascertained in accordance with the regulations.

        (2)    For the purposes of sections 145 and 146, the question of whether there is a significant risk that any of the operations that could be carried on under a production licence will have a significant adverse impact on operations that are being, or could be, carried on under:

             (a)    a greenhouse gas assessment permit; or

             (b)    a greenhouse gas holding lease; or

             (c)    a greenhouse gas injection licence;

is to be determined in a manner ascertained in accordance with the regulations.

Impact of greenhouse gas operations

        (3)    For the purposes of sections 249AF and 249BD and paragraph 435B(2)(b), the question of whether there is a significant risk that a key greenhouse gas operation will have a significant adverse impact on petroleum exploration operations, or petroleum recovery operations, that are being, or could be, carried on under:

             (a)    an existing exploration permit; or

             (b)    an existing retention lease; or

             (c)    an existing production licence; or

             (d)    a future exploration permit; or

             (e)    a future retention lease; or

              (f)    a future production licence;

is to be determined in a manner ascertained in accordance with the regulations.

        (4)    For the purposes of sections 249CI and 249CR and paragraph 435B(2)(c), the question of whether there is a significant risk that any of the operations that could be carried on under a greenhouse gas injection licence will have a significant adverse impact on operations that are being, or could be, carried on under:

             (a)    an existing exploration permit; or

             (b)    an existing retention lease; or

             (c)    an existing production licence; or

             (d)    a future exploration permit; or

             (e)    a future retention lease; or

              (f)    a future production licence;

is to be determined in a manner ascertained in accordance with the regulations.

        (5)    For the purposes of section 249CZC and paragraph 435B(2)(d), the question of whether there is a significant risk that any of the operations that are being, or could be, carried on under a greenhouse gas injection licence will have a significant adverse impact on:

             (a)    operations to recover petroleum; or

             (b)    the commercial viability of the recovery of petroleum;

is to be determined in a manner ascertained in accordance with the regulations.

(19)  Schedule 1, item 109, page 41 (after line 27), after section 15H, insert:

15J  Designated agreements

                 For the purposes of this Act, a designated agreement is an agreement of the kind referred to in any of the following provisions:

             (a)    paragraph 79A(5)(f);

             (b)    paragraph 79A(6)(d);

             (c)    subsection 79A(10);

             (d)    paragraph 114A(5)(f);

             (e)    paragraph 114A(6)(d);

              (f)    subsection 114A(10);

             (g)    paragraph 138A(5)(f);

             (h)    paragraph 138A(6)(d);

              (i)    subsection 138A(10);

              (j)    paragraph 249AF(5)(d);

             (k)    paragraph 249AF(6)(d);

              (l)    subsection 249AF(11);

            (m)    subsection 249AF(12);

             (n)    paragraph 249BD(5)(d);

             (o)    paragraph 249BD(6)(d);

             (p)    subsection 249BD(11);

             (q)    subsection 249BD(12);

              (r)    subparagraph 249CI(1)(d)(iii);

             (s)    subparagraph 249CI(1)(e)(iii);

              (t)    subparagraph 249CI(2)(d)(iii);

             (u)    subparagraph 249CI(2)(e)(iii);

             (v)    paragraph 249CI(3)(a);

            (w)    subparagraph 249CR(d)(v);

              (x)    paragraph 249CR(e);

             (y)    paragraph 249CR(f);

              (z)    paragraph 249CR(g);

            (za)    paragraph 249CZC(1)(e).

(20)  Schedule 1, page 41 (before line 28), before item 110, insert:

109A  Section 21

Insert:

greenhouse gas title means:

             (a)    a greenhouse gas assessment permit; or

             (b)    a greenhouse gas holding lease; or

             (c)    a greenhouse gas injection licence; or

             (d)    a greenhouse gas search authority; or

             (e)    a greenhouse gas special authority.

109B  Section 21

Insert:

petroleum title means:

             (a)    an exploration permit; or

             (b)    a retention lease; or

             (c)    a production licence; or

             (d)    an infrastructure licence; or

             (e)    a pipeline licence; or

              (f)    a special prospecting authority; or

             (g)    an access authority.

109C  Section 21 (definition of title)

Repeal the definition, substitute:

title means:

             (a)    a greenhouse gas title; or

             (b)    a petroleum title.

(21)  Schedule 1, page 43 (after line 23), after item 117, insert:

117A  After subsection 78(1)

Insert:

     (1A)    Express references in this Act to the injection or storage of a substance do not imply that subsection (1) does not operate so as to authorise the permittee:

             (a)    to carry on operations to inject a substance into the seabed or subsoil of an offshore area; or

             (b)    to carry on operations to store (whether on a permanent basis or otherwise) a substance in the seabed or subsoil of an offshore area.

      (1B)    The regulations may provide that an exploration permit authorises the permittee, in accordance with the conditions (if any) to which the permit is subject:

             (a)    to explore in the permit area for a potential greenhouse gas storage formation; and

             (b)    to explore in the permit area for a potential greenhouse gas injection site; and

             (c)    to carry on such operations, and execute such works, in the permit area as are necessary for those purposes.

117B  Subsection 78(2)

Omit “subsection (1)”, substitute “or under subsection (1) or (1B)”.

(22)  Schedule 1, page 49 (after line 15), after item 120, insert:

120A  After subsection 113(1)

Insert:

     (1A)    Express references in this Act to the injection or storage of a substance do not imply that subsection (1) does not operate so as to authorise the lessee:

             (a)    to carry on operations to inject a substance into the seabed or subsoil of an offshore area; or

             (b)    to carry on operations to store (whether on a permanent basis or otherwise) a substance in the seabed or subsoil of an offshore area.

      (1B)    The regulations may provide that a retention lease authorises the lessee, in accordance with the conditions (if any) to which the lease is subject:

             (a)    to explore in the lease area for a potential greenhouse gas storage formation; and

             (b)    to explore in the lease area for a potential greenhouse gas injection site; and

             (c)    to carry on such operations, and execute such works, in the lease area as are necessary for those purposes.

120B  Subsection 113(2)

Omit “subsection (1)”, substitute “or under subsection (1) or (1B)”.

(23)  Schedule 1, item 125, page 54 (line 30) to page 55 (line 2), omit the item, substitute:

125  After subsection 137(1)

Insert:

     (1A)    Express references in this Act to the injection or storage of a substance do not imply that subsection (1) does not operate so as to authorise the licensee:

             (a)    to carry on operations to inject a substance into the seabed or subsoil of an offshore area; or

             (b)    to carry on operations to store (whether on a permanent basis or otherwise) a substance in the seabed or subsoil of an offshore area.

      (1B)    The regulations may provide that a production licence authorises the licensee, in accordance with the conditions (if any) to which the licence is subject:

             (a)    to explore in the licence area for a potential greenhouse gas storage formation; and

             (b)    to explore in the licence area for a potential greenhouse gas injection site; and

             (c)    to carry on such operations, and execute such works, in the licence area as are necessary for those purposes.

      (1C)    The regulations may provide that, if:

             (a)    petroleum is recovered in the licence area of a production licence (the first licence); and

             (b)    operations for the recovery or processing of the petroleum are carried on using a facility located in the licence area of another production licence (the second licence); and

             (c)    a prescribed substance (which may be a hydrocarbon) is recovered as an incidental consequence of the recovery of the petroleum;

the second licence authorises the licensee of the second licence, in accordance with the conditions (if any) to which the second licence is subject:

             (d)    to inject the substance into the seabed or subsoil of the licence area of the second licence; and

             (e)    to store (whether on a permanent basis or otherwise) the substance in the seabed or subsoil of the licence area of the second licence; and

              (f)    to carry on such operations, and execute such works, in the licence area of the second licence as are necessary for those purposes.

     (1D)    Subsections (1B) and (1C) do not limit subsection (1).

125A  Subsection 137(2)

Omit “subsection (1)”, substitute “or under subsection (1), (1B) or (1C)”.

(24)  Schedule 1, page 87 (before line 8), before item 165A, insert:

165AA  At the end of Part 2.10

Add:

226A  Responsible Commonwealth Minister may require information about negotiations for a designated agreement

Scope

        (1)    This section applies to the following applications:

             (a)    an application under subsection 79A(1) for approval to carry on one or more key petroleum operations under a declared exploration permit;

             (b)    an application under section 114A for approval to carry on one or more key petroleum operations under a declared retention lease;

             (c)    an application under subsection 138A(1) for approval to carry on one or more key petroleum operations under a declared production licence;

where either or both of the following are relevant to the responsible Commonwealth Minister’s decision on the application:

             (d)    the existence or non-existence of a designated agreement;

             (e)    the terms of a designated agreement.

Report about negotiations

        (2)    The responsible Commonwealth Minister may, by written notice given to the applicant, require the applicant to give to the responsible Commonwealth Minister, within the period specified in the notice, a written report about negotiations, or attempts at negotiations, relating to:

             (a)    the entering into of the designated agreement; and

             (b)    the terms of the designated agreement.

Consequences of breach of requirement

        (3)    If the applicant breaches the requirement, the responsible Commonwealth Minister may, by written notice given to the applicant:

             (a)    refuse to consider the application; or

             (b)    refuse to take any action, or any further action, in relation to the application.

        (4)    Subsection (3) has effect despite any provision of this Act that requires the responsible Commonwealth Minister to:

             (a)    consider the application; or

             (b)    take any particular action in relation

Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Change, Environment and Urban Water) Share this | Link to this | Hansard source

Let me make a series of points in relation to the Offshore Petroleum Amendment (Greenhouse Gas Storage) Bill 2008 and amendments (1) to (93) as moved by the Minister for Resources and Energy. Firstly, the opposition endorse and strongly support the intention of the bill and the supporting cognate bills. It flows in fact from material which we commenced whilst we were in government. Secondly, we do appreciate, as the minister outlined, the work of the House of Representatives Standing Committee on Primary Industries and Resources and their inquiry into the exposure draft of the Offshore Petroleum Amendment (Greenhouse Gas Storage) Bill 2008. It was an excellent example of House committees working to improve a bill, working on a bipartisan and constructive basis across this chamber on an issue of genuine resource security and national environmental importance. Thirdly, we also appreciate the minister’s willingness to provide the exposure draft and to engage in genuine discussion with our representative in the Senate.

That brings me to the fourth point. We have foreshadowed that we will be moving amendments in the Senate. They will be subject to debate, and I am hopeful that we will receive the support and agreement of the government on those amendments. The fifth point is a respectful point of disagreement in relation to these 93 amendments, not in relation to the content; we will scrutinise that carefully. I have been advised, and therefore my understanding is, there was an agreement that such amendments would be held back until after the Senate Standing Committee on Economics, which is also conducting an inquiry, had reported. I remain to be corrected on that, but it would certainly have been our preference in any event that the Senate committee, which is conducting a parallel inquiry and is due to report to the Senate on 16 October 2008, would have been allowed to present its findings before these amendments were moved.

Nevertheless, the opposition will not be opposing these amendments at this point. We will consider them carefully as part of the process. We have a respectful view—to the minister and to the government—that perhaps these amendments were called forward to deal with a gap in the government’s legislative agenda, which is not so much to say it is the minister’s fault as to make a broader criticism about the government’s absence of legislative material more generally.

With all of those elements, we acknowledge the intention of the bill. We appreciate the work of the House of Representatives committee. We acknowledge the minister’s general consultation on this. We foreshadow our right—and our intention, in fact—to present amendments in the Senate. Whilst not opposing the bill, we note our concern about the failure to wait until after the Senate committee had reported. I believe it would have been sensible, prudent and reasonable to have waited until after 16 October 2008 and after the Senate committee’s material and advice was on the table. Nevertheless, for those reasons we support the intention of the bill and we choose not to oppose these amendments at this point as they pass through the House.

Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Link to this | Hansard source

Can I firstly indicate my appreciation of the constructive comments of the opposition spokesperson. With respect to the debate, the bills were brought on because of their importance. The Australian government regard the intent of this legislation as fundamentally important to our economic and environmental future. They are therefore, in our minds, matters that require urgent and proper consideration by both houses. Hence, we wanted to facilitate this debate sooner rather than later because our desire is to endeavour to get them through both houses to enable us, sooner rather than later, to release acreage for proper consideration from a greenhouse gas point of view in a commercial sense.

Secondly, can I say that I have no knowledge of any undertaking that the House of Representatives should delay its work to await the work of the other place. In this instance, the House of Representatives has finally started to seize the opportunities to consider legislation in its own right. Historically, this House has all too often not utilised its own committee structure to its advantage and has deferred to the other house. The House has been given an oppor-tunity on this occasion to consider a bill in detail and to express a point of view that the government has responded to, and we all appreciate the huge amount of work that went into the preparation of that report. I indicated that we would respond to the House report to enable members to consider our response in the debate in the House of Representatives, because the report represents the consideration of the bill by fellow members of the House and therefore members of the House are entitled to know the government’s view on the recommendations of the House committee.

With respect to the opposition, there have been and will continue to be consultations about any outstanding issues. Our desire is to reach agreement with the opposition because we appreciate that in the context of this bill they are absolutely supportive of the endeavours of the government to put in place greenhouse gas storage opportunities in offshore areas of Australia, the responsibility of the Australian government. I know that was the desire of the previous minister, the member for Groom, who sat down on a number of occasions in detailed discussions with me and my staff, and we will continue those discussions, the last meeting having been as late as this morning.

I commend the amendments to the House and simply express my appreciation to all members on both sides for their assistance in considering what is a very complex and difficult bill but one of major significance to our future in the 21st century.

Ian Macfarlane (Groom, Liberal Party, Shadow Minister for Trade) Share this | Link to this | Hansard source

Can I endorse the words of the minister and thank him for the assistance that he, his office and his department have offered to the opposition on what is, as he said, an extraordinarily complex issue, an issue which will underpin by far the biggest proportion of the low-emissions strategy for the Commonwealth government of Australia as we go forward from here.

As the minister said and as I am sure my colleague said, this is an extraordinarily complicated process. It is a process that spans back to the time when I was the Minister for Industry, Tourism and Resources. It is a process that, if we are not careful, will span into the time of the next minister for resources. The member for Batman and I do not know when that will be—

Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Link to this | Hansard source

I hope it is a long way into the future!

Ian Macfarlane (Groom, Liberal Party, Shadow Minister for Trade) Share this | Link to this | Hansard source

I will be doing my best to make sure it is not. With due deference and total respect to you, may your time as minister be short!

Peter Slipper (Fisher, Liberal Party) Share this | Link to this | Hansard source

Order! The love-in appears to be evaporating.

Ian Macfarlane (Groom, Liberal Party, Shadow Minister for Trade) Share this | Link to this | Hansard source

Okay, back to the issue. This issue has the potential not to be resolved, not because of any loss of goodwill from our side of parliament or loss of determination or goodwill from the government. It needs to be managed precisely as we go forward. There are complexities in the legislation which, as the minister said, as late as this morning were still not resolved, and there are going to be issues between the shadow minister for resources, Senator Johnston, me as his representative in this House and the minister opposite and, I assume, the Senate economics committee as well. I understand their report may be released today but will not be formally reported to the Senate until 16 October.

All those processes need to take their full time. We cannot afford to rush this because, if we get it wrong, whilst we may have legislation in place we will have actually gone backwards. We are trying to do in Australia what no-one else has done. We are trying to lay down a framework also, on behalf of the Commonwealth, which will be adopted, we hope, by a majority of the states. Some states will choose a separate process, but if they are smart, quite frankly, they will choose this process. We need to get it right. We need to ensure the holders both of petroleum exploration leases and, perhaps, of leases that have gone past that into retention leases and production leases are satisfied with the process. They may not welcome this occurrence but they understand the reason it is happening. At the same time we need to ensure that legal entitlements are maintained.

This issue is of crucial importance, so I seek an undertaking from the government that they will ensure that all processes are given full run and that the debate and discussions that go on in the Senate are not forced through in such a way that the Senate Standing Committee on Economics is not able to present its report before the legislation is finalised. I commit the opposition to ongoing support of and dialogue with the government on this matter. I hope that we can bring about a satisfactory resolution for all parties involved.

Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Link to this | Hansard source

I appreciate the comments of the member for Groom. Like the opposition, we await the Senate report to see if there are any other thoughtful proposals that can improve this bill. I give the member for Groom and the opposition an undertaking that in the lead-up to that Senate report and after it is received we will continue discussions. Our proposal to have this considered in the Senate as soon as possible will not stand in the way of seeking to conclude those discussions and of reaching an accommodation with the opposition. My office has commenced discussions with two Independent senators because of the importance of also consulting those senators who have taken an interest in these matters and are generally supportive of them, as is the opposition.

Question agreed to.

Bill, as amended, agreed to.