Monday, 11 May 2015

Risk based approach to compliance and enforcement - NSW Division of Resources and Energy

The NSW Division of Resources & Energy (DRE) has published its new Compliance and Enforcement Policy which introduces a risk-based approach.  

The DRE will determine its enforcement approach by identifying the likelihood of a particular event occurring and the consequence to the community, industry and DRE should that event occur. 

The DRE’s Compliance & Enforcement branch (established on 31 July 2014) oversees and investigates non-compliances with obligations created by the grant of a right to explore, extract or produce petroleum or minerals in NSW, as well as unlawful mining or petroleum extraction activities.  Its functions include:
  • monitoring overall industry compliance
  • developing compliance initiatives and programs, and
  • determining the level of enforcement to be applied in cases of non-compliance.

The risk-based approach to compliance and enforcement means that businesses who have not complied with relevant polices, regulations, approval or licence conditions are deemed ‘high risk’, while business that do comply are determined to be ‘low-risk’.

The DRE’s stated regulatory objectives are:
  • to maximise a titleholder's compliance with legislation and policies governing coal, mineral, petroleum and coal seam gas activities
  • to provide for a healthy and safe work environment for mineworkers resulting in zero deaths and a reduction in serious injuries occurring in the workplace
  • to promote a culture of environmental protection and best practice environmental management in the exploration, mining and petroleum industries
  • to educate and provide guidance to industry and the community
  • to demonstrate consistency in the compliance and enforcement actions taken by DRE
  • to promote transparency in DRE's decision making processes
  • to conduct thorough and timely investigations of potential non-compliances or alleged breaches of legislation, policies or approvals
  • to exercise enforcement action in a professional, transparent and effective manner
  • to encourage self regulation and timely reporting of non-conformances to Government, and
  • to protect the interests of the State and the people of NSW.

The DRE has identified that it will focus its regulatory actions on ‘those who consciously choose not to comply with the law’, and will be undertaken in order to raise industry awareness and to encourage a change in attitude or behaviour.  The 2015-2016 compliance priorities will be:
  • titleholders, prospectors or mine operators whose activities potentially have significant safety implications
  • titleholders, prospectors or mine operators whose activities actually or potentially have a significant impact upon the environment, community or government revenue
  • titleholders, prospectors or mine operators whose activities whose activities attract significant public interest
  • titleholders, prospectors or mine operators whose activities who have a history of non-compliance with title conditions, and
  • titleholders, prospectors or mine operators who are not undertaking effective exploration.

The DRE’s auditing program will include compliance inspections and assessments, desktop audits, targeted audits and comprehensive audits, which will review information about business operations through onsite investigation and intelligence gathering.
Enforcement actions can include financial penalties, permit penalties (imposition of restrictive conditions) and suspension or cancellation of licences, permits and authorities. 
Explorers and miners in NSW should be aware of the new Compliance and Enforcement Policy being implemented by DRE and should ensure that they comply with the conditions of any mining or petroleum tenement. Additionally, if your activities attract significant public interest you may get extra attention from DRE notwithstanding a strong environmental record. We can assist you with understanding your obligations under your tenement conditions.

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