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Wednesday, 21 September 2011
Page: 10949


Mr CREAN (HothamMinister for Regional Australia, Regional Development and Local Government and Minister for the Arts) (09:31): I move:

That this bill be now read a second time.

This bill is one of a number of amendments being introduced to improve the regulation of the offshore petroleum industry following the Montara incident. These include legislation to establish a national regulator for the offshore petroleum industry and additional work currently being undertaken to implement the Australian government's response to the report of the Montara Commission of Inquiry.

This bill amends the Offshore Petroleum and Greenhouse Gas Storage Act 2006, the OPGGS Act, to specifically enable the National Offshore Petroleum Safety and Environmental Management Authority, NOPSEMA, to issue a direction to a petroleum titleholder in the event of a significant offshore petroleum incident occurring within the title area that has caused or might cause an escape of petroleum. A direction would require the titleholder to take action either within or outside the title area in relation to the escape or possible escape of petroleum and its effects. The matters covered by a direction could include action to prevent or eliminate the escape of petroleum and/or to mitigate, manage or remediate the effects of an escape of petroleum. This would include, for example, clean-up of petroleum that has escaped as a result of an incident and has extended beyond the boundaries of the title area.

This bill helps to ensure that the regulator has the full ability to provide for remediation of the effects of an escape of petroleum in the event of an offshore uncontrolled release of hydrocarbons. Currently, under the Offshore Petroleum and Greenhouse Gas Storage Act, there are powers, including the authority in part 6.4 of that act, which allow the regulator to give remedial directions to titleholders in relation to the restoration of the environment. These powers in the bill enable the regulator to give remedial directions to petroleum titleholders about the removal of property, the plugging or closing of wells, the conservation and protection of natural resources or the making good of damage to the seabed or subsoil. However, these provisions are primarily for the purposes of decommissioning and, as such, this direction-giving power is limited to requiring action to be taken within the titleholder's area.

In addition, the National Offshore Petroleum Safety and Environmental Management Authority will have a general power to give directions to petroleum titleholders under the Offshore Petroleum and Greenhouse Gas Storage Act in relation to a number of matters. However, it is desirable that NOPSEMA have a specific power to issue directions in the event of a significant offshore petroleum incident, to provide a clear legal basis on which to issue directions that extend to requiring action outside the title area.

The report of the Montara Commission of Inquiry found that the regulatory framework should provide powers to regulators to enable directions to a petroleum titleholder requiring remediation of environmental damage both within and outside the title area. In the unlikely event of a future significant petroleum incident, such as the uncontrolled release of hydrocarbons into the marine environment, remedial action would be required to be taken as quickly as practicable. These amendments will ensure that regulators have a clear and unambiguous power to direct petroleum titleholders to take remedial action as quickly as practicable to mitigate and manage the impacts from an escape of petroleum. Failure of the petroleum titleholder to comply with the direction will be an offence of strict liability under the OPGGS Act, to enable effective enforcement of the offshore petroleum legislation, particularly given the remote and complex nature of offshore operations.

The protection and management of the marine environment is critical to the Australian community's confidence in the ability of the offshore petroleum industry to undertake operations in a safe and environmentally sound manner. The Australian government is committed to providing a world's best practice regulatory framework for the offshore petroleum industry that will encourage investment in exploration and development of Australia's offshore oil and gas resources whilst also providing safeguards for human health and safety and the marine environment.

I commend the bill to the House.

Debate adjourned.