Review of WA's Mining Rehabilitation Fund released

On 18 April 2024, the Western Australian (WA) Government tabled in Parliament the ‘Review of the Mining Rehabilitation Fund’ (MRF Review), prepared by Marsden Jacob Associates (Marsden Jacobs) for the Department of Energy, Mines, Industry, Regulation, and Safety (DEMIRS). The report was produced as part of a requirement by the Mining Rehabilitation Fund Act 2012 (MRF Act) that the legislative scheme be reviewed by the Minister every 10 years.

Marsden Jacobs has concluded that the MRF Act, supporting legislation and the operation of the Mining Rehabilitation Fund (MRF) do not require wholesale reform, but would benefit from incremental improvements.

The Minister has stated that DEMIRS will commence working with key stakeholders on a response to the recommendations. We anticipate this will be followed by policy and legislative changes later in the year.

There were 16 recommendations for legislative, regulatory or policy change, with some of the key recommendations including:

• Broadening the MRF to include mines operating under State Agreements.
• Implementing a system which monitors levels of progressive rehabilitation at the industry level and creates incentives and disincentives to encourage compliance with best practice.
• Introducing a tiered reporting approach for rehabilitation liabilities such that more detailed reporting is required for sites with rehabilitation liability estimates (RLE) greater than a specified value (such as $1 million).
• Reviewing RLE categories to ensure they reflect modern mining practices.
• Implementing a regular review of RLE values and introducing a process which indexes RLE values against inflation.
• Introducing a regular, periodic review of the contribution rate (currently at 1%), noting that the review finds the current rate to be appropriate.
• Introducing a system for increasing or decreasing the contribution rate depending upon a project’s risk to the environment.
• Permitting funds to be borrowed from the MRF’s principal in times of low interest rates, subject to some constraints.

The review also recommends that the role of the Mining Rehabilitation Advisory Panel (MRAP) be reviewed with any proposed changes consulted upon broadly with industry. The MRAP is a body created by the MRF Act and is tasked with providing advice to the CEO on matters prescribed in the regulations. Currently, this includes advising on the administration of the MRF.

The Marsden Jacobs review of the MRF, although required by statute, is also timely. Subsequent policy and legislative changes will need to carefully balance industry’s desire for streamlined reporting and a general reduction in compliance burden across environmental approvals in WA (see our blog post on the Vogel-McFerran Review here), with any potential expansion to the MRF. Stakeholder consultation will remain key, including clearly communicating the achievements of the MRF in facilitating the rehabilitation of abandoned mines and adequately integrating those rehabilitated mines with community objectives, such as tourism opportunities. Progress towards the achievement of rehabilitation of abandoned mines will become more imperative given that the legislation is no longer in its infancy, and in circumstances where the size of the MRF continues to grow.

For more detailed advice in relation to your response to the MRF Review or how any subsequent reform may impact you, please contact Melanie Debenham or Naomi Hutchings*.

*Naomi Hutchings currently holds a seat on the Mining Rehabilitation Advisory Panel, having been appointed for a three-year term from August 2022.

By Melanie Debenham, Partner, Naomi Hutchings, Special Counsel, and Jared Hee, Solicitor.