Challenge to ERC Calculator — Land Court confirms strict application is not required
Century Mining Limited (Century) owns and cooperates the Century Mine in North-West Queensland, which is an open-cut zinc and lead mine which ceased mining in 2015. Since 2018, Century has been re-processing the tailings to recover zinc.
Century applied for an ERC decision for the Century Mine.
DES determined the amount of ERC required for the activities was $230,465,718, confirmed on internal review.
Century appealed the decision to the Land Court, contending that the ERC should be $173,271,205.71.
The two main issues in this proceeding were:
The first issue was resolved through the Court Managed Expert Evidence (CMEE) process, where the expert witnesses in their Joint Expert Report agreed that the design proposed by Century, if it met certain design requirements, would meet the company’s environmental obligations.
The agreed estimated costs of implementing the design requirements in the Joint Expert Report did not comply strictly with the ERC Guideline and the approved calculation methodology under the ERC Guideline. However, the Land Court identified that the purpose of the ERC Guideline, made under section 550 of the EP Act is to “provide guidance”.
Consequently, the Land Court identified that DES is not required, in making an ERC decision, to “slavishly apply the amount arrived at using the approved calculation methodology”.1 The Land Court relied also on section 2.5.1 of the ERC Guideline, which identifies relevant reports, such as the Joint Expert Report, as matters that must be considered in making an ERC decision.
The decision makes clear that the ERC Guideline, as a statutory instrument, must yield to the EP Act. The key requirement in section 300(1) is that DES must decide the ERC amount based on the estimated cost of:
Therefore, the Land Court was prepared to accept the expert evidence and decide that the required ERC amount is $183,916,150.06.
The case makes it clear that in making ERC decisions, DES does not need to strictly apply the ERC calculator and may consider other evidence, in order to meet the requirements of section 300(1) of the EP Act.
For further information and discussion, please contact our Resources and Energy team.
1 Century Mining Limited v Department of Environment and Science  QLC 3, at paragraph 
2 EPA, section 300(1)