Land Court approves environmental authority for Blue Energy Limited’s Sapphire gas project after landmark appeal

HopgoodGanim Lawyers successfully acted for Blue Energy Limited (ASX:BLU) (Blue) in a landmark Land Court appeal against the grant of an environmental authority (EA) for Blue’s Sapphire gas project (Project).

The Department of Environment, Tourism, Science and Innovation (DETSI) granted an EA for the Project, but Environmental Advocacy in Central Queensland Inc. (Appellant) lodged an appeal to the Land Court (Appeal) raising various grounds on which it alleged the EA should not have been granted. In its judgment,¹ the Land Court decided to grant an EA on amended terms.

This is the first published decision on an appeal against a decision by DETSI to grant an EA for a petroleum project.

A shift in focus for environmental challenges in Queensland

Historically, environmental challenges to resources projects in Queensland have focused on challenges to coal mine approvals, with recent successes in that area (e.g. the Land Court recommended against the approval of a thermal coal mine proposed by Waratah Coal).

This Appeal was a first-of-its-kind challenge to an EA for a petroleum lease in Queensland and may signal a shift in focus for environmental challenges from coal projects to petroleum projects.

The decision sheds light on the process to be followed when an EA for a petroleum project is appealed to the Land Court of Queensland.

Approval process for petroleum leases in Queensland

The approvals process for petroleum leases (PL) in Queensland is different to the approvals process for mining leases (ML). Relevantly, for the grant of an ML, there is an objection process whereby the ML application is publicly notified, and people can object to the grant of the ML.² There is no equivalent objection process for the grant of a PL. A recent review ³ was set to consider the development of a review process for PLs, but the new State Government withdrew the reference for that review in March 2025 and the review was not concluded.

However, it is a prerequisite for the grant of a PL that the applicant holds an associated EA authorising all environmentally relevant activities under the PL.⁴ While there is no objection process for the grant of a PL, there is provision for public submissions, objections and appeals to the grant of the associated EA.

To have an EA approved, an applicant must publish their EA application online and in a locally circulating newspaper, allowing the community an opportunity to make submissions in relation to the application. In deciding whether to grant the EA, DETSI will take into account any validly made submissions.⁵ If DETSI approves the EA, any submitters may request an internal review of that decision. DETSI will consider any further submissions in deciding whether to confirm the decision to grant the EA. If the internal review upholds the grant of the EA, submitters may appeal the decision to the Land Court.

Once the matter is referred to the Land Court, the court has the same powers as those of the Chief Executive of DETSI to decide the appeal.⁶ The appeal is by way of rehearing, unaffected by the original decision which means, in effect, that the Court will make a new decision based on the evidence put before the Land Court (which can include new evidence).⁷ For a site-specific EA, the Land Court has the same powers as DETSI under section 172 of the Environmental Protections Act 1994 (Qld) (EP Act) giving the Court power to either:

1. approve the application subject to conditions; or
2. refuse the application.

Blue’s Sapphire gas project

The project is planned to target coal seam gas (CSG) reserves within the Sapphire block, which is located in the Moranbah region in Queensland. 

Blue gave evidence in the Appeal that it intended to utilise gas from the project to supply:

1. the Townsville Energy Chemicals Hub (TECH) project, being a battery materials refinery; and
2. gas on an “as available” basis to the Moranbah Gas project.

The proceedings

Blue applied for the EA as agent for and on behalf of its subsidiary, Eureka Petroleum Pty Ltd (Eureka). The EA initially related to activities within PL 1034 (Sapphire), PL 1038 (Central) and PL 1045 (Lancewood). However, shortly after the Appeal was commenced, Blue and Eureka withdrew the PL applications for the Central and Lancewood block, limiting the EA’s application to the Sapphire block. Eureka has instead applied for potential commercial areas (PCA) 336 and PCA 337 over the Central and Lancewood blocks.

The EA was initially granted by DETSI in March 2023 (Original Decision). Lock the Gate Alliance Limited (Lock the Gate) and Isaac Regional Council both applied for an internal review of the Original Decision. Five submissions were received on the internal review applications, including submissions from the Appellant and Blue. In its submission, Lock the Gate alleged that there were uncertain and potentially significant impacts on groundwater and surface water, climate change, economics and biodiversity, which could not be managed by conditions. In July 2023, DETSI confirmed its decision to approve the EA, but imposed new conditions relating to wells and pipelines (Review Decision).

In August 2023, the Appellant filed its notice of appeal in the Land Court. DETSI, Blue and Eureka were named as respondents to the Appeal. The Appellant sought to set aside DETSI’s Review Decision based on various issues, including:

1. a challenge to the CSG production estimates;
2. issues associated with groundwater;
3. the lack of a greenhouse gas (GHG) emissions estimate; and
4. issues associated with flora and fauna assessment.

Through the course of the proceedings, the parties reached agreement on proposed amendments to the EA which responded to the grounds of the Appeal relating to flora and fauna and groundwater. The parties agreed that the issues relating to the CSG production estimate and GHG emissions had been addressed by Blue’s decision to limit activities to the Sapphire block and the evidence given by in the proceedings.

Ultimately, the parties sought a consent judgment from the Land Court to approve an amended EA.

The decision

In its decision, the Land Court considered the history of the EA and the Appeal. It relied on the assessments undertaken by DETSI in the Original Decision and the Review Decision and analysed each of the proposed amendments to the EA in that context. The agreed amendments included:

1. restricting activities to the Sapphire block (reflecting Blue’s prior withdrawal of the Central and Lancewood PLs); and
2. adding additional steps, measures and reporting requirements regarding flora, fauna and groundwater.

After analysing the proposed amendments and the grounds of Appeal, the Land Court accepted that the proposed amendments would not materially increase impacts to environmental values and added requirements that would help to avoid or minimise environmental impacts.

Ultimately, the Land Court decided to set aside the Review Decision and substituted a new decision to grant the EA on the amended terms agreed between the parties.

No orders were made as to costs. This follows the default position in the Land Court that, absent any other orders, each party bears its own costs.⁸

Given the current shift in focus of environmental challenges towards petroleum projects, this decision provides insight into the process by which appeals against EAs for petroleum activities will be decided by the Land Court.

1. Environmental Advocacy in Central Queensland Inc v Department of Environment, Tourism, Science and Innovation & Ors [2025] QLC 7.
2. Mineral Resources Act 1989 (Qld), Chapter 6 Part 1.
3. https://www.qlrc.qld.gov.au/re...
4. Petroleum and Gas (Production and Safety) Act 2004 (Qld), section 121(1)(f).
5. See Environmental Protection Act 1994 (Qld) Chapter 5, Part 5 for the rules relating to DETSI’s decision-making process.
6. Environmental Protections Act 1994 (Qld), section 528.
7. Environmental Protections Act 1994 (Qld), section 527.
8. Land Court Act 2000 (Qld), section 27A.