Bills Digest no. 127 2009–10
Offshore Petroleum and Greenhouse Gas
Storage (Safety Levies) Amendment Bill 2010
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage history
Purpose
Background
Financial implications
Main provisions
Concluding comments
Contact officer & copyright details
Passage history
Offshore Petroleum and Greenhouse Gas
Storage (Safety Levies) Amendment Bill 2010
Date introduced: 10 February 2010
House: House of Representatives
Portfolio: Resources and Energy
Commencement: Sections 1 to 3 on Royal Assent, but Schedule 1 is to
commence retrospectively on 1 January 2010.
Links: The relevant links to the Bill, Explanatory Memorandum
and second reading speech can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/. When Bills have been passed they can
be found at ComLaw, which is at http://www.comlaw.gov.au/.
This Bill amends the Offshore Petroleum
and Greenhouse Gas Storage (Safety Levies) Act 2003 to include transitional
arrangements from 1 January 2010 to 31 December 2012 which will allow:
- that where a safety management plan is in place for a pipeline in
designated coastal waters, the effect will be as if there were a safety case in
force for that facility
- the states and the Northern Territory to put in place provisions
in their own legislation which will reflect the changes in Commonwealth
legislation relating to the safety case regime, and
- the Commonwealth to collect safety case levies[1] in designated coastal waters.
The purpose of this Bill is to provide transitional
arrangements for the period from 1 January 2010 until 31
December 2012 to allow the states and the Northern Territory to implement
mirror legislation that corresponds to the current Commonwealth Offshore
Petroleum (Safety) Regulations 2009 concerning the payment of safety case
levies. It will also enable the Commonwealth to collect levies in the meantime
in relation to designated coastal waters.
Section 8 of the Act imposes a safety case levy in
relation to a facility in designated coastal waters. The term ‘designated
coastal waters’, in relation to a state or the Northern Territory, has the same
meaning in section 3 of the Act as in Part 6.9 of the Offshore Petroleum and
Greenhouse Gas Storage Act 2006.[2]
The safety case levies are calculated according to the formula set out in the Offshore
Petroleum and Greenhouse Gas Storage (Safety Levies) Regulations 2004, which
also sets out the procedures for payment.
In the current Bill, references to the Petroleum (Submerged
Lands) (Management of Safety on Offshore Facilities) Regulations 1996 are replaced
by references to the Offshore Petroleum (Safety) Regulations 2009 (the Safety Regulations
2009). The Safety Regulations 2009 were tabled on 2 February 2010 and
the disallowance period will end shortly. The regulations commenced on 1
January 2010. The Explanatory Statement comments on the purpose of the
regulations:
The purpose of the Offshore Petroleum (Safety) Regulations
2009 (the Safety Regulations) is to consolidate and update the safety-related
regulations under the Act into one legislative instrument. The consolidation
incorporates the Petroleum (Submerged lands) (Management of Safety on Offshore
Facilities) Regulations 1996, the Petroleum (Submerged Lands) (Occupational
Health and Safety) Regulations 1993, and the Petroleum (Submerged Lands)
(Diving Safety) Regulations 2002. References to the Act are also corrected.
The Safety
Regulations are also amended to allow for offshore pipelines to be regulated as
“facilities” under the safety case regime. This is consistent with amendments
to the Offshore Petroleum and Greenhouse Gas Storage (Safety Levies) Act
2003 on 8 October 2009, with effect from 1 January 2010, removing
provisions relating to the pipeline safety management plan levy.[3]
The Offshore Petroleum (Safety Levies) Regulations 2004 were amended by the Offshore (Safety Levies) Amendment Regulations 2009 No.1.
The Explanatory Statement comments on the purpose of the regulations as follows:
The purpose of the amendments to the Offshore Petroleum
(Safety Levies) Regulations 2004 is to remove references to the pipeline safety
management plan levy, to amend the safety case levy so that it covers pipelines
and to extend coverage of safety levies to future greenhouse gas storage
activities. The amendments also increase the unit value to work out the amount
of safety levy payable. They also update the regulations to refer to and be
consistent with the Principal Act and the Safety Levies Act.[4]
For further detailed policy background and basis for this
legislation, see the following Bills Digests:
o to retain fees
under the Offshore Petroleum and Greenhouse Gas (Registration Fees) Act 2006 to provide establishment funding for the National Offshore Petroleum Regulator
(NOPR),
o to augment the
functions of National Offshore Petroleum Safety Authority (NOPSA) to include
regulatory oversight of non-structural integrity for facilities, wells and well-related
equipment, and
o to update
listed OHS laws in section 638 of the Offshore Petroleum and Greenhouse Gas
Storage Act 2006.
The Selection of Bills Committee resolved to recommend that
the Bill not be referred to committees.[5]
The Alert Digest of the Senate Standing Committee for the
Scrutiny of Bills drew attention to the retrospective provisions in items 2,
5 and 6 of Schedule 1 of the Bill. The Committee commented that it generally
draws attention to any Bill where retrospective application of provisions is
included and makes comment on whether it adversely impacts on people or not.
The Committee quoted a passage from the Explanatory Memorandum for the Bill as
follows:
While the Amendment Act provided transitional arrangements it
did so on the basis that State and Territory regulations which correspond to
the Commonwealth regulations would be similarly amended. This has not yet
occurred which means that some safety levy payments due to the National
Offshore Petroleum Safety Authority may not be collectable until such time as
the Act is amended. Thus a transitional period is required …
The Committee acknowledged this explanation and commented
that it was unaware of any detrimental impacts as a result of the retrospectivity.[6]
The Explanatory Memorandum states that the Bill does not
have any financial impact on the Australian Government Budget. There are no
additional costs to industry.[7]
Schedule
1— Amendments to the Offshore Petroleum and Greenhouse Gas Storage (Safety
Levies) Act 2003.
Item 1 amends the definition of ‘safety case in
force in relation to a facility’ in existing subsection 7(8) to omit
reference to the Petroleum (Submerged Lands) (Management of Safety on Offshore
Facilities) Regulations 1996 and insert a reference to the new Offshore
Petroleum (Safety) Regulations 2009 which commenced on 1 January 2010. Among
other things, the Safety Regulations repealed the Petroleum (Submerged Lands)
(Management of Safety on Offshore Facilities) Regulations 1996 (the 1996
Regulations).
Item 2 amends section 8 of the Act which deals
with the imposition of a safety case levy in designated coastal waters. Proposed
subsection 8(7A) is inserted to provide that if during a period starting 1
January 2010 and ending 31 December 2012, there is a pipeline safety management
plan in force for a pipeline that is a facility, then the section has effect,
with the result that the safety management plan will be treated as if it were a
safety case in force for that facility.
Proposed subsection 8(7B) provides that if:
- a facility located or proposed to be located in designated
coastal waters, and
- during the period 1 January 2010 to 31 December 2012, a safety
case is in force for the facility under legislation (within the meaning of
regulations made by the relevant state or the Northern Territory which mirrors
provisions or substantially corresponds with the 1996 Regulations as
immediately in force before 31 December 2009), section 8 then has effect as
though a safety case were in force for that facility at the relevant time. In
other words, the safety case will be treated as being in force under the Offshore
Petroleum (Safety) Regulations 2009.
Item 3 inserts a definition of ‘pipeline safety
management plan in force in relation to a pipeline’ into subsection 8(8) of
the Act. Item 4 amends the definition of ‘safety case in force in
relation to a facility’ in subsection 8(8) to remove a reference to the 1996
Regulations and replace it with a reference to the Safety Regulations.
Items 5 and 6 provide that the amendments in items 1
and 4 (being the insertion of the reference to the Safety Regulations 2009 in
place of the 1996 Regulations in the definition of ‘safety case in force in
relation to a facility’ in subsections 7(8) and 8(8) of the Act) apply in
relation to a safety case in force at the start of a year starting on or after
1 January 2010 (or part of that year).
This Bill enables the Commonwealth to collect safety case
levies even though the states and the Northern Territory have not as yet passed
legislation that corresponds to the changes to the Commonwealth’s regulations.
Members, Senators and
Parliamentary staff can obtain further information from the Parliamentary
Library on (02) 6277 2784.
Moira Coombs
15 March 2010
Bills Digest Service
Parliamentary Library
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