Court decision

Supreme Court provides some clarity on Ministerial power for excisions and bespoke conditions on mining tenure

31 October 2022

Earlier today, Quinlan CJ handed down his decision in Blue Ribbon Mines Pty Ltd v Roy Hill Infrastructure Pty Ltd [2022] WASC 362 (Blue Ribbon Decision). The Blue Ribbon Decision resulted from industry action to refer four fundamental questions of law from the Perth Warden’s court relating to the validity of excisions and bespoke conditions (including so called ‘no mining’ conditions) which until recently were commonly used methods to facilitate overlapping grant of mining tenure under the Mining Act 1978 (WA) (Mining Act) in Western Australia.  

The questions of law in this particular case arose out of an application for an exploration licence lodged by Blue Ribbon Mines Pty Ltd (Blue Ribbon), which was objected to by several major iron ore proponents, Roy Hill, FMG and BHP, as a result of overlaps with their key infrastructure (such as railways, roads and pipelines). Consistent with historical practice, the parties put to the Warden a Minute of Programming Directions Sought by Consent (MOPD) which proposed the parties’ agreed terms for the grant of Blue Ribbon’s exploration licence application. The agreed terms related to various excisions of land and bespoke conditions which would apply to the granted exploration licence. The central issues the subject of the Blue Ribbon Decision came to light in early 2021, when the Department of Mines, Industry Regulation and Safety (Department) published a series of position papers which expressed the Department’s doubt as to the lawfulness of excisions and bespoke conditions. Since that time, industry has been pushing for greater clarity and the Blue Ribbon Decision is an important milestone on this journey.

The four fundamental questions of law in the Blue Ribbon Decision related to whether the Minister can excise areas of land (in this case from an exploration licence application that overlaps granted miscellaneous licences and a general lease) and impose bespoke conditions on the exploration licence grant, such as a ‘no mining condition’ (which prohibits mining or exploration activities on specified areas) or a condition prohibiting activities unless consent of the Minister or, importantly, a third party (such as the holder of the underlying infrastructure tenure) is obtained.

In answering these reserved questions, the Supreme Court held:

  • the Minister does not have the power to excise areas of land the subject of a miscellaneous licence from an exploration licence;
  • the Minister does not have the power to excise areas of land the subject of a general lease (being ‘private land’ under the Mining Act) from an exploration licence;
  • the Minister does have the power to impose a ‘no mining condition’ in respect of discrete areas overlapping a miscellaneous licence or private land provided the condition is imposed in accordance with the Mining Act; and 
  • the Minister does have the power to impose conditions relating to the applicant obtaining Ministerial or third party consent and/or to comply with future conditions imposed by the Minister provided the condition is imposed in accordance with the Mining Act

Unfortunately for the purposes of providing absolute certainty to the industry, the decision focused on the fundamental legal questions as opposed to the particular conditions put forward by the objectors. Therefore, whilst the Blue Ribbon Decision gives some useful commentary, it does not amount to binding precedent on the particular conditions put forward by the objectors.

For a discussion about how this decision may affect your mining tenements, please contact our Resources and Energy team.

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