26 August, 2015
What has happened?
The NSW Land and Environment Court has dismissed claims by Gold and Copper Resources Pty Ltd that two mining purposes leases granted to Cadia Holdings Pty Ltd over land in relation to which GCR had lodged applications for Exploration Licences were invalid.
In Gold and Copper Resources Pty Ltd v The Hon Chris Hartcher MP, Minister for Resources and Energy [2015] NSWLEC 116, Justice Craig held:
- GCR’s EL applications did not prohibit the granting of the MLs as they were not granted with respect to any minerals,
- the failure to include information on ‘the mineral bearing capacity of the land’ within the ML applications did not invalidate the leases, and
- it was not manifestly unreasonable to grant the MLs without any depth restriction.
Who does this affect?
All mining and mineral exploration projects.
Background
Cadia operates a gold and copper mining complex known as Cadia Valley Operations near Orange in New South Wales. CVO involves underground mining and open cut mining as well as associated ancillary infrastructure.
In September 2013, the Minister for Resources and Energy granted the MLs to Cadia. The MLs were for ‘mining purposes only’. The MLs specified various ancillary developments such as pipelines and the extension of a dam.
Prior to the approval of the MLs, GCR had lodged applications for ELs partly in the area over which the MLs were ultimately granted. Following the approval of the MLs, GCR commenced proceedings in the LEC challenging their validity.
These proceedings were dismissed for the reasons explained below.
Issues and determination
GCR claimed:
- the MLs were granted in breach of s 58(1)(c)(i) of the Mining Act 1992 (NSW) (Mining Act) because it had already lodged applications for ELs over parts of the same land and for the same minerals in respect of which the MLs were sought,
- the applications for the MLs did not indicate the mineral bearing capacity of the land and were thus deemed to have been refused by operation of cl 76(9) of the Mining Regulation 2010 (NSW) (Regulations), and
- granting the MLs was manifestly unreasonable because they were granted without any restriction as to depth.
Justice Craig rejected each of these claims and dismissed the proceedings for the following reasons.
Reasoning
Are mining purposes leases granted ‘in respect of’ minerals?
GCR claimed the MLs were granted in breach of s 58(1)(c)(i) of the Mining Act. This section relevantly provides that a mining lease cannot be granted over land subject to an existing application for an EL ‘that includes minerals in respect of which the mining lease is sought’ without written consent of the applicant for the EL.
The Minister and Cadia argued s 58(1) does not apply to an application for a mining purposes lease or, in the alternative, that the mining purposes leases were not granted ‘in respect of’ any minerals.
Justice Craig held that s 58(1) does apply to applications for mining purposes lease but agreed with the Minister and Cadia that such leases were not granted ‘in respect of’ any minerals and so rejected this ground of challenge: at [73].
Is assessment of ‘mineral bearing capacity of land’ essential?
Section 51(5)(a) and (b) of the Mining Act provide that an application for a mining lease must contain:
- a description … of the proposed mining area, and
- an assessment of the mineral bearing capacity of the land.
Clause 76(9) of the Regulations provides that if an application for a mining lease is lodged and information that was required to be included in the application is lodged more than 10 days thereafter, the application is deemed to have been refused.
Both applications for the MLs were marked ‘N/A’ in respect of the requirements of subsections (a) and (b) of s 51(5). GCR claimed this meant that the applications should have been deemed to have been refused.
Justice Craig rejected this argument and held that s 51(5) did not impose an essential condition for the validity of the application and that cl 76(9) of the Regulations did not override the discretionary decision-making process prescribed under the Mining Act (at [128]–[130]).
Was failure to include depth restrictions manifestly unreasonable?
GCR argued that it was manifestly unreasonable for the Minister to grant, as he had done, MLs to an unlimited depth without knowing the mineral bearing capacity of the land.
The Minister submitted the mineral bearing capacity of the land was not relevant in an application for a mining purposes lease. Cadia also submitted that it is a matter for the Minister to determine whether there is sufficient information available to enable him to make a decision on the application, and that it was reasonably open for him to approve the applications in the context, particularly given that the authorised works would not extend deeply into the ground.
Justice Craig accepted the Respondents’ submissions in respect of this ground of challenge and held that the Minister’s decision to grant the MLs was not manifestly unreasonable: at [156].
For further information, please contact:
Peter Briggs, Partner, Herbert Smith Freehills
peter.briggs@hsf.com
