Mine Regulator Under Fire

SA’S mining regulatory regime has a conflicted lead regulator and lacks transparency, according to Environmental Defenders Office principal solicitor Melissa Ballantyne.

The EDO’s stance on the issue, submitted to the Natural Resources Committee inquiring into fracking, has been echoed by landholders, community groups and other members of parliament.

The focus is not confined to the petroleum and natural gas industry but all mining in the state.

“Everything from the approvals of exploration licenses through to production and environmental regulation is conducted by the Department of State Development,” Ms Ballantyne said.

“This is also the case in other states, but has attracted wide criticism due to the inherent conflict of interest with having the license issuer also acting as a de-facto environmental regulator.

“This issue of regulatory capture does not assist with transparency and community confidence in the regulatory system.”

But mineral resources and energy minister Tom Koutsantonis said the state’s regulatory framework was considered “world’s best practice”.

“I have full confidence in the DSD as regulator, whose hardworking public servants have the best interests of South Australians at the forefront of their decision-making,” he said.

Opposition spokesman Dan van Holst Pellekaan did not see any conflict of interest.

“It is not uncommon for a government department to regulate an industry and for the government to also be supportive of the industry when it follows the regulations,” he said.

“Trust in the system is based on having good regulations properly enforced more than on which authority actually does it.”

THE Natural Resources Committee inquiring into fracking heard conflicting opinions on the state of SA’s regulatory framework for granting mining exploration licence approvals and upholding environmental standards.

The Environmental Defenders Office insisted there was an issue of regulatory capture in SA, while Santos vice president – eastern Australia James Baulderstone told the NRC that SA had a world class framework to oversee the natural gas industry’s activities.

He said it gave the state a competitive advantage and the key to maintaining investor confidence was ongoing government support and a stable regulatory framework.

The Greens MLC Mark Parnell said it was no wonder mining companies regarded SA as world’s best practice regulation given their favourable relationship with the department.

“The DSD and its predecessors have all been afflicted by regulatory capture,” he said.

“At the heart of the problem is the fact that the agency with primary responsibility for regulating and licensing the mining industry is also responsible for promoting the industry and even subsidising mining industry activity with taxpayers’ money,” he said.

“The legislation that the department administers is stacked in favour of the mining companies and against the rights of local communities.

“It is virtually impossible to challenge mining decisions in the courts because the industry and the department have convinced a succession of ministers and parliaments that in the interests of “certainty”, the local community should have as few rights to interfere with mining as possible.”

YP Landowners Group’s Joy Wundersitz said they had no confidence in the approvals process and believe consultation is a farce.

“All of the advantages rest with the companies which have time, money and political clout on their side.

“The Hillside Mining Lease Proposal and Appendices were almost 3000 pages long, much of it highly technical. The government’s euphemistically called ‘public consultation’ phase lasted a mere eight weeks (including an extension) despite requests from the public for far more time to read and understand the complex document.

“This power imbalance between mining companies and the community is exacerbated by the inordinately strong support given by both major political parties to the mining industry.”

Family First MLC Robert Brokenshire said the regulatory role should be independent in its entirety.

He is calling for a mining ombudsman to provide independent arbitration and for the government to refocus its attention on maximising primary production.

Mr van Holst Pellekaan is also developing policy which proposes a ombudsman to deal with issues of potential conflict between mining, oil and gas projects, and pre-existing land uses.