Miscellaneous Purpose Licences Under the Mining Act 1971 (SA)

March 19, 2015 / Property

Applications, conditions and compensation

Section 52 of the Mining Act 1971 (SA) (Mining Act) allows the Minister to grant a miscellaneous purpose licence (MPL) to any person in respect of mineral land for:

• the carrying on of any business that may conduce to the effective conduct of mining operations or provide amenities for persons engaged in the conduct of mining operations;
• establishing and operating plant for the treatment of ore recovered in the course of mining operations;
• drainage from a mine;
• the disposal of overburden or any waste produced by mining operations; or
• any other purpose directly relating to the conduct of mining operations.

A Prescribed Form 17 is required to initiate the MPL application along with payment of the prescribed fee. The MPL must also identify the area to which the licence is to apply pursuant to regulation 52.

The Department of Primary Industries and Regions (PIRSA) have clarified the conditions under which a MPL may be granted, in their publication titled ‘Minerals Regulatory Guidelines Version 1.9: Guidelines for miners – mining approval processes in South Australia’. Generally, MPLs are suitable where the following applies to the proposed MPL activities:

• The activity is required to achieve economic and practical mining activities on a mining lease owned by the proponent in SA (where the activity is for infrastructure that may be used for other private or public purposes, the primary purpose should be to support the mining operation).
• The proposed activity will achieve better environmental outcomes if located outside the mining lease, or it is not practical due to area limitations to undertake the activity on the mining lease.

While a mineral claim is not a prerequisite tenement to a MPL, the tenure of a MPL will be linked to the tenure of the primary mining lease or operation to avoid the existence of MPLs without clear linkage to an active mining operation. Where the proposed MPL does not share a common boundary with a mining lease, specific justification will be required from the applicant to demonstrate that no other tenure is practical and that the activity is integral to the economics of the mining activity.

Operations that may be suitable for the grant of a MPL include:

• Transport of ore (e.g. haul road, railway, slurry pipeline or conveyor).
• Water supply pipeline, where greater than 50% of the water transported is required for mining operations.
• Dam or other water storage facility.
• Airstrip for a mine site.
• Electricity supply for mining operations where greater than 50% of the electricity transported is required for mining operations.
• Processing, value-adding plant, camps, temporary mineral storage or other infrastructure and permanent overburden dumps, and tailings dams where the MPL shares a common boundary with the relevant mining lease and either:
  • the MPL is required to avoid sterilisation of resources (e.g. if the infrastructure were located on the mining lease, resources would not be able to be practically mined); or
  • an environmental benefit is gained by granting the MPL (e.g. there is a sensitive environment on the lease area, and relocation of the infrastructure off the lease area will result in overall less environmental impact).

Operations that may not be considered appropriate for the grant of a MPL include:

• Roads, railways, water pipelines, electricity lines or airstrips where these initially are planned to be primarily servicing a purpose other than mining.
• Processing plant or other infrastructure located remotely from the mine site.
• Infrastructure for value adding of mineral products (e.g. manufacturing retail products from minerals) where less than 50% of the raw material used does not derive from the mine.
• Gas pipelines.

While landowners (or pastoral leaseholders) do not have the right to object to or veto the grant of a MPL, they do have the right to make representations on the application to the Minister and also the right to compensation. In addition, the grant of a MPL or the activities authorised by a MPL are not considered ‘mining’ under the definition of the Native Title Act 1993 (Cth) and hence native title parties do not have the benefit of a formal negotiated agreement under Part 9B of the Mining Act. Any native title claimants do have the same rights as other landowners; that is, the right to make comments to the Minister on the MPL application and the right to compensation.

Section 54 of the Mining Act provides for compensation to landowners (or pastoral leaseholders) of land in respect of which a MPL is granted. The amount of compensation payable depends on individual circumstances, including
factors such as:

• the potential impact to the land from the proposed activities (e.g. intensive use of existing property tracks, unplanned damage to land or infrastructure);
• any loss of productivity or profits resulting from the conduct of proposed activities (e.g. loss of existing livestock or crops);
• reasonable costs incurred by the landowner related to the miner accessing their land (e.g. use of water for drilling, operational supervision such as shepherding, unplanned disturbances such as assisting bogged vehicles); and/or
• reasonable costs incurred by the landowner in negotiating compensation (e.g. negotiating initial land access agreement and obtaining legal advice).

If parties are unable to negotiate the amount and type of compensation, either party may apply to the Warden’s Court (for amounts up to $250,000) or the Environment, Resources and Development Court (for amounts exceeding $250,000) for an order in relation to compensation.

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This communication provides general information which is current as at the time of production. The information contained in this communication does not constitute advice and should not be relied upon as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Should you wish to discuss any matter raised in this report, or what it means for you, your business or your clients' businesses, please feel free to contact us.