COVID-19: Managing the impact on mining and petroleum operations

Originally published 30 March 2020. Article updated 24 April 2020 and 27 May 2020.

Material added on 27 May 2020 is in blue for ease of reference.

In response to the COVID-19 pandemic, the Federal Government has implemented (and is continuing to implement) a number of measures intent on slowing down the transmission of the virus in order to prevent our healthcare system from being overwhelmed.

These measures are, however, coming at a great economic cost and are having a devastating effect on a range of industries. Fortunately, in what is an indication of its economic importance, the mining industry in Queensland has continued to have access to certain exemptions but the nature of these exemptions changes frequently as the response to the pandemic evolves.

It is important that all resources companies ensure that they audit their operations and consider how to manage compliance during this pandemic. Particular areas of risk are:

1. Environmental compliance;
2. Work health and safety; and
3. Governance and management

Environmental compliance

Approvals and permits management

The COVID-19 measures have been announced at a speed that has required a variety of legislative changes to be pushed through Queensland parliament as quickly as possible. 

The Queensland Government has passed temporary amendments to the Environmental Protection Act 1994 (Qld) (EP Act) pursuant to the Justice and Other Legislation (COVID-19 Emergency Response) Amendment Act 2020 (Qld) (Emergency Response Act).

In summary, the Emergency Response Act:

1. provides the Minister with the power to make a declaration waiving compliance of certain conditions of an environmental approval (either for a particular holder or in respect of a condition that applies to multiple holders), and
2. allows the administering authority to issue temporary environmental authorities, where these actions are deemed reasonable because of the COVID-19 emergency. Any declared exemptions are temporary. The Minister’s power to make declarations ends on 31 December 2020 and declarations cannot remain in force past 30 June 2021.

Mining operators should consider how social distancing measures and other restrictions on or interruptions to its workforce (including its contractor workforce) may compromise its ability to comply with environmental obligations.

We recommend:

1. conducting a technical review of all operational permits and approvals (like environmental authorities) to consider whether a pandemic impacted workforce can comply with all requirements.  As an example, is a type of monitoring at the site only performed by an external contractor who could be required to self-isolate?
2. conducting an audit of all mining approvals, outstanding applications for approvals or amendments to approvals to ensure that deadlines and timeframes can be achieved. As an example, ensuring that results from testing will be available in time to respond to a request for information or being prepared to lodge an application for renewal of exploration tenure in the next 6 months; and
3. seeking advice as soon as possible if there are concerns about the ability to comply with environmental obligations to enable an application for a relaxation or temporary approval under the provisions of the Emergency Response Act.  

COVID-19 Compliance notification form

Prior to the amendments to the EP Act set out above, the Department of Environment and Science (DES)  permitted operators to submit a COVID-19 compliance notification form (Compliance Form) (available here) if they identified that they could not comply with a condition of an environmental authority.

It is not clear whether this process will remain available to proponents. The Compliance Form is still available on the DES website, however, these changes are recent and a further update from DES may be imminent.

In any event, it is a better outcome for proponents to be able to rely on a declaration from the Minister confirming they do not have to comply with certain conditions rather than a representation from the DES that they will not pursue enforcement action (as with the Compliance Form) which is not provided for under the EP Act. In the circumstances, we recommend relying on the updated legislative processes provided for in the Emergency Response Act – however companies may wish to utilise both methods if timing is critical.

Incident response

If there is an environmental incident on-site during this period, at this stage, there is no relaxation regarding the requirements to notify of an incident under the EP Act. The Pollution Hotline will still be open 24 hours a day 7 days a week.

Operators must review their incident response plans to ensure that controls are put in place to ensure that notification occurs in the event that staff who are usually responsible for such action are not available due to COVID-19. 

We recommend that:

1. each key staff member responsible for environmental incident response management and regulator communication has a dedicated ‘back-up’; and
2. IT systems are updated so that generic ‘environment@company.com’ emails are sent to groups of staff rather than one or two to prevent significant emails being overlooked.

We have a dedicated environmental incident response team to assist with environmental incidents. You can reach us at enviro@carternewell.com at any time. 

Court update

It is important to be aware that the Queensland Land Court and Queensland Planning and Environment Court are open and continuing to deal with matters as listed unless specific orders are made to the contrary.

Parties will be allowed to conduct all hearings, reviews, court managed expert evidence conferences and mediations by teleconference or videoconference wherever suitable and if appearances in person are necessary, the Courts will observe social distancing practices.

This serves as a reminder to all parties that litigated matters will still need to be advanced during this period of disruption; hearings (such as mining objections hearings) will proceed largely as per normal. 

However, if there are genuine interruptions caused by COVID-19 (such as experts or landholders becoming unwell or being required to isolate), it is imperative that such issues are brought to the attention of the Court as early as possible. 

Additionally, the Planning and Environment Court has recently announced that the ADR Registrar will continue to convene ADR conferences but only via teleconference or videoconference, unless exceptional circumstances exist.

Workplace health and safety

Managing the workforce

It is clear that employers must consider how to manage the health and safety of its staff in relation to the risks associated with contracting COVID-19 in the workplace. This may result in social distancing measures being implemented with a view to reducing face to face meetings and other person to person interactions.

In relation to a mining site, there may be broader implications for health and safety, such as the ability to properly implement safety and health management systems in circumstances where less employees may be on site and physical distancing measures could practically restrict the implementation of those management systems.

It will be imperative for mining operators to review safety and health management systems and consider whether further advice is required in relation to any increase in risk exposure as well as compliance with safety legislation.

Andrew Shute, Partner, and Lara Radik, Special Counsel, have prepared the following overview of the other workplace challenges posed by the COVID-19 pandemic and are updating this article regularly (click here to view).

Staff movement restrictions

Queensland, like other states and territories, closed its borders as of 12:01am on 26 March 2020 to help slow the transmission of COVID-19.

Exemptions are still available for resource sector employees, however, the nature of these exemptions have continued to evolve.

As of 12.01am Saturday 11 April 2020, a person who arrives in Queensland from another State or Territory of Australia will not be allowed to enter unless they are an exempt person.

An exempt person includes a person who is a resources or energy sector employee:

1. whose company or service provider has a plan to manage preventing the transmission of COVID-19 that complies with the requirements of the Chief Health Officer (Health Plan);
2. the person is a critical resources sector employee; and
3. if the person is a FIFO worker, they provide the following information on arrival:
   1. name of their employer;
   2. evidence they are FIFO;
   3. evidence they are entering Queensland to go directly to work; and
   4. evidence of the location of the worksite or work camp;
   5. evidence they are a critical resources sector employee.

A critical resources sector employee is a person that:

1. is required to be appointed under the Coal Mining Safety and Health Act 1999 (Qld); the Quarrying Safety and Health Act 1999 (Qld); or the Petroleum and Gas (Production and Safety) Act 2004 (Qld) and the position is mentioned in the list published on the Queensland Health website (for example, a site senior executive or site safety manager); or
2. the person has been approved by the Chief Health Officer as a critical resources sector employee.

The Queensland Government has published a Health Plan template (access here) to assist resources operators in developing Health Plans that comply with Chief Health Officer’s Border restrictions (no.4). Completed plans should be sent to covid.plans@health.qld.gov.au.

Affected mining and petroleum operators will need to move swiftly to ensure they have a compliant Health Plan in place and can retain their workforce to the extent possible under these new arrangements and seek any necessary advice if there are concerns around meeting statutory safety or other obligations as a result.

Governance and management

Business continuity

To address difficulties during the COVID-19 pandemic with witnessing and execution of certain documents by companies, the Corporations (Coronavirus Economic Response) Determination (no. 1) 2020 has made temporary changes to the Corporations Act 2001 (Cth) (Corporations Act) to allow electronic execution when signing pursuant to s 127(1). Matt Couper, Partner, and Kelly Pain, Senior Associate have prepared a newsletter providing detailed guidance about these changes (click here to view).

These difficulties with witnessing and execution have extended to other documents such as affidavits and statutory declarations. This has now been addressed at a State level by the Justice Legislation (COVID-19 Emergency Response – Wills and Enduring Documents) Regulation 2020 (Qld) which provides for affidavits and statutory declarations, as well as some other specified documents to be signed electronically and for witnessing to occur via audio visual link in Queensland. Andrew Shute, Partner, provides an in depth look at these arrangements in a recent newsletter (click here to view).

FIRB changes

Following an announcement by the Federal Government regarding protecting Australia’s national interest during the economic downturn broad on by COVID-19, the Foreign Investment Review Board (FIRB) has recently announced changes that will likely impact mining and petroleum operators; the monetary threshold amounts which apply in determining whether particular foreign investments made on or after 10:30pm Sunday, 29 March 2020 are subject to Australia’s foreign investment framework are now $0.

This means that all foreign investment will now require FIRB approval and further, FIRB will be requiring applicants to extend the decision period for applications involving significant actions or exemption certificates by up to 6 months from the date the application fee is paid, in what is a clear attempt to stop foreign investors acquiring compromised Australian businesses.

Conclusion

In this unprecedented time, mining and petroleum operations must be maintained to ensure safety for people and for the environment. Operators must act quickly to consider how this can best be achieved in the context of the relevant legislative regimes and changing circumstances. 

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This article may provide CPD/CLE/CIP points through your relevant industry organisation.

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