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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
2012-09-18 Daily Xml
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PETROLEUM AND GEOTHERMAL ENERGY (TRANSITIONAL LICENCES) AMENDMENT BILL

Introduction and First Reading

Received from the House of Assembly and read a first time.

Second Reading

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women) (15:38): I move:

That that this bill be now read a second time.

The Petroleum and Geothermal Energy (Transitional Licences) Amendment Bill 2012 introduces amendments to the Petroleum and Geothermal Energy Act 2000 to ensure the validity of certain past grants, consolidations and renewals for petroleum production licences held by Santos Limited, Delhi Petroleum Pty Ltd and Origin Energy Resources Limited in the Cooper Basin.

It has been drawn to the state's attention that there are potential unintended consequences arising from the transitional provisions of this act. The state has concerns that, if the proposed amendments are not made, many petroleum production licences could be found to be flawed on the basis of the unintended legislative effect. Such a finding would have very serious consequences for the confidence of the petroleum industry in carrying on business in South Australia and the state's ability to encourage future investment in the state's petroleum sector.

The state may have inadvertently excluded the grant and renewal of certain transitional petroleum production licences under earlier petroleum legislation from the normal intended renewal provisions in part 2, division 3, subdivision I of the commonwealth Native Title Act 1993, and instead left them subject to the right to negotiate provisions in subdivision P. This scenario was never intended to be the case and has come about only as a result of an unintended interaction between the transitional provisions of the Petroleum and Geothermal Energy Act and the commonwealth Native Title Act.

The proposed amendments to the Petroleum and Geothermal Energy Act have retrospective operation in order to ensure that existing transitional petroleum production licences were granted, renewed or consolidated consistently with subdivision 1 and therefore did not attract the right to negotiate. Newer production licences granted after the commencement of the Petroleum and Geothermal Energy Act will still be subject to the right to negotiate (or the alternative Indigenous land use agreement) provisions in the usual way. Native title parties have already participated and will continue to participate in these processes, which usually occur before the exploration stage and which cover both exploration and production.

In presenting this legislation to parliament, the government has carefully weighed up the need to provide certainty to petroleum producers in the Cooper Basin, who have continued to produce petroleum on renewed tenements in the belief that they had been properly issued, against the understandable desire of native title parties to participate in the economic benefits of petroleum production.

The government is confident that native title parties and petroleum producers will work together in a productive and positive manner to ensure mutually beneficial economic outcomes from petroleum production in this important part of the state. I commend the bill to members. I seek leave to have the explanation of clauses inserted in Hansard without my reading it.

Leave granted.

Explanation of Clauses

Part 1—Preliminary

1—Short title

This clause is formal.

2—Commencement

It is important to note that this measure will be brought into operation without delay. Furthermore, the amendment relating to the on-going operation of section 32 of the repealed Act to the renewal of transitional licences under the Act, and to provide expressly that a licence arising from the consolidation or division of any area that relates to a transitional licence will in turn be a transitional licence, will be taken to have come into operation on the day on which the Act came into operation (25 September 2000).

3—Amendment provisions

This clause is formal.

Part 2—Amendment of Petroleum and Geothermal Energy Act 2000

4—Amendment of section 82—Consolidation of licence areas

In the case of the consolidation of 2 or more licence areas, it will now be the case that the licences will continue or will be amalgamated (with such conditions as may be appropriate and without the issue of a new licence). The rights of the holder of a licence after a consolidation will be no more extensive than those existing before the consolidation.

5—Amendment of section 83—Division of licence areas

This amendment provides for the enactment of a provision to the effect that the rights of the holder of a licence after the division of an area will be no more extensive than those existing before the division.

6—Amendment of Schedule—Transitional provisions

This amendment relates to the term and status of transitional licences, including after the consolidation or division of a licence area. Special provision is also made to clarify the status of petroleum production licences granted under the Cooper Basin (Ratification) Act 1975.

Schedule 1—Transitional provisions

1—Transitional provisions

These provisions ensure that the reforms effected by this measure will extend to licences issued before the commencement of the measure as an Act.

Debate adjourned on motion of Hon. S.G. Wade.

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