Mining Law and Tenement Management – NSW Community Consultation Code of Practice

The regulatory framework governing mineral exploration in NSW is made up of a number of sources of authority including the following:

• Mining Act 1992
• Mining Regulation 2016
• Codes of Practice
• Mineral Prospecting Minimum Standards
• Standard Conditions for Mining and Exploration

The above is by no means an exhaustive list, with different exploration activities potentially triggering further approval or compliance requirements under state and federal laws. If you’re not sure about the relevant approval requirements for your proposed activities (in NSW or elsewhere), feel free to get in touch or alternatively reach out to Hetherington Legal or Hetherington Environmental to speak to one of our mining lawyers or environmental consultants.

With the ever-growing importance of environmental, social and governance (ESG) considerations to successful resource projects, we thought it would be helpful to provide a summary in relation to once of the most important and sometimes overlooked components of the NSW mineral exploration regulatory framework, the Exploration Code of Practice: Community Consultation.

Who must comply with the Exploration Code of Practice: Community Consultation? Why is compliance essential?

Essentially all Exploration Licences and Assessment Leases in NSW are subject to a condition requiring compliance with the Exploration Code of Practice: Community Consultation. The Code of Practice sets out a number of requirements, many of which are mandatory, for holders of prospecting titles in NSW. These range from reporting requirements to record keeping obligations and can be the subject of a compliance audit at any time. It’s therefore critical that tenement holders are aware of their obligations under the Code of Practice and implement effective systems to ensure ongoing compliance and avoid penalties associated with non-compliance.

Compliance audits and potential penalties for non-compliance aside, the Code of Practice is also a good starting point for establishing proactive ESG practices to safeguard your operations and maintain a social licence to operate. Early and proactive consultation activities are important to the long-term viability of any exploration program, with local stakeholders having extensive powers under mining and environmental law, which can have major impacts on proposed exploration activities.

What are the mandatory requirements of the Exploration Code of Practice – Community Consultation?

Mandatory requirements under any Code of Practice effective serve as the minimum threshold for compliance. Breaching these requirements would constitute a breach of conditions of title, rendering the holder liable to penalties ranging from fines to cancellation of tenements.

At a glance, the mandatory requirements for compliance with the Exploration Code of Practice: Community Consultation are as follows:

• Risk Assessment

Prior to starting any operations under a prospecting tenement, the holder must ensure a risk assessment has been undertaken to identify and consider the range of opportunities and potential threats associated with community consultation and engagement.

• Community Consultation Strategy (CCS)

Once the Risk Assessment has been completed, a CCS must be prepared and regularly updated by the tenement holder, which manages any risks identified in the risk assessment. It is critical that the form and content of the CCS is adequate for the scale and extent of prospecting operations to be undertaken, the underlying land and identified stakeholders.

• Community Consultation Report (CCR)

Progress against and implementation of the CCS must be documented in an annual report to be lodged with the Department along with the other components comprising the Annual Activity Report for the particular prospecting title. A critical part of this process is identifying new opportunities to update and improve community consultation activities, particularly in the context of new prospecting operations.

• Record Keeping

The final mandatory requirement under the Code of Practice is keeping records relating to community consultation. Ultimately this obligation should work in the holder’s favour and compliment any broader ESG recording and reporting practices.

How can the mandatory requirements be met (and surpassed) in practice?

Whilst its great to be aware of what your requirements are on paper, being able to implement them effectively and achieve best practice in accordance with your ESG goals is critical. We’ve set out some helpful tips for implementing the requirements in practice.

1. Start early and do your research. Consultation should start before setting foot on the ground with research and enquiries into the affected stakeholders, broader community concerns and any sensitive receivers being instrumental in early identification of potential project constraints.
2. Treat community consultation as part of any approvals process. When preparing necessary approvals for a particular activity, account for any required community consultation activities and required changes to your community consultation strategy.
3. Clearly communicate expectations for community consultation with all staff and contractors. The holder of a tenement will be held accountable for contractors’ mistakes. Establishing robust practices and internal compliance and record keeping mechanisms is critical to compliance.
4. Have an action plan ready for worse case scenarios. Mistakes happen and are always a risk in any project. Putting in place adequate response mechanisms and effective mitigation measures will limit the fallout and keep social licence and overall ESG performance intact.
5. Maintain detailed records. Record keeping is key to compliance and monitoring changes in attitudes and expectations over time.

How can Hetherington help?

Hetherington has an excellent track record in assisting clients with their community consultation obligations including:

• Completion of community consultation risk assessments.
• Preparation, review and update of Community Consultation Strategies.
• Preparation and lodgement of Community Consultation Reports.
• Maintenance of community consultation records and registers.
• Compliance audits and establishing in-house community consultation and ESG protocols and procedures.

Call the team at Hetherington today to find out more about how we can help you meet your community consultation and ESG goals.