Land reform wins but worries linger

There are significant wins in the changes for farmers, but landholder groups warn there are also some major concerns.

Resources and Energy Minister Anthony Roberts is now “looking forward to spending some more time with my family” after the long reform slog kicked off in 2013, when NSW Chief Scientist Mary O’Kane released the first of several investigations of coal seam gas (CSG), which called for sweeping reforms to the industry’s regulation.

“For too long this state allowed an out-dated and inefficient approach to allocating our resources and to the industry’s interaction with the community,” Mr Roberts said when he brought the reforms to Parliament.

Mr Roberts said the new laws would bring transparency and balance to competing land use in NSW.

“It was a huge operation that should have been done 20 years ago,” Mr Roberts said after the Bills passed the Upper House without amendment.

Further impetus for reform came in April last year when senior counsel Bret Walker kicked off an independent review of land access arbitration and recommended a myriad of changes.

The old system was denounced by farmers who argued landholders held all the risks and bore the brunt of costs from arbitration.

Increased protections have been brought to the process that landholders are corralled into when terms cannot be reached with an exploration proponent.

Landholders’ costs must now be paid by the explorer throughout the process where before legal expenses were covered only for initial legal advice.

Also, landholders are guaranteed the right to legal representation where previously if one party declined to lawyer up the other must also abstain – often a key advantage to the legal eagles in the resources sector.

But farmer concern lingers.

Costs are capped, but up to a “reasonable” level, which would be determined by the minister.

At issue is exactly what the minister deems a “reasonable cost”.

Expenses can stretch to many tens of thousands of dollars when legal representation and agricultural experts are engaged.

Resource developers invest heavily in land access and typically seek advice from a fleet of experts to bolster their cases in arbitration, a distinct disadvantage for individual landholders.

NSW Farmers president Derek Schoen said arbitration costs should be assessed based on what was reasonable for an individual’s situation.

“The capped approach has been adopted by government though, so we will be working hard to ensure the capped amounts accurately reflect the reality of what it costs for landholders to go through these processes,” Mr Schoen said.

Lock the Gate said some of its members had “incurred enormous costs” during compulsory arbitration.

“The threat of a cap on costs would limit landholders’ ability to get the advice and support they need,” said Lock the Gate national campaign co-ordinator Carmel Flint.

The definition of “a significant improvement” made by a landholder to their property was changed as well.

Significant improvements were a bone of contention for explorers because the legislation allowed landholders to bar access to them – which could have included anything from fences, to roads or even improved pastures.

Mr Roberts said the old “exhaustive list of features” had been replaced with a “non-prescriptive” criteria.

Now, to qualify as a significant improvement the law requires it satisfied a series of criteria.

A significant improvement must: Be a substantial and valuable improvement to the land, reasonably necessary to the enterprise, fit for its purpose and cannot reasonably co-exist with the explorer’s proposed activity without hindrance and cannot reasonably be relocated or substituted without material detriment to the landholder.

Retired Family Court judge Ian Coleman SC said the new definition of significant improvements “placed the onus of proof on the farmer to prove it cannot reasonably co-exist” with resources exploration.

“It will be critical what ‘reasonable’ costs are set by the minister,” he said.

Mr Schoen welcomed “the fact a broad test now applies although requirements around improvements being ‘necessary’ or their removal being of ‘material detriment’ are concerning”.

“An improvement does not need to be necessary or materialistic to be of value.

“Government has committed to a review of the new laws in six months time, so we will make sure the opportunity is used to have a closer look at this issue.”

A strategic release framework for coal and CSG was implemented to earmark areas for resources development only after environmental, social and economic factors have been assessed.

Lock the Gate and NSW Farmers said the new regulation should have gone further, to rule out resources development on prime farmland.

Ms Flint criticised the new law that permits seismic testing on roadsides without landholder or local government consent.

Moree and Lismore councils have passed motions for a moratorium on CSG exploration on local roads.

Further regulations to support the new legislation are yet to be determined.