Commonwealth of Australia Explanatory Memoranda

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OFFSHORE PETROLEUM AMENDMENT (DATUM) BILL 2008

                               2008




THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA




                HOUSE OF REPRESENTATIVES




OFFSHORE PETROLEUM AMENDMENT (DATUM) BILL 2008




               EXPLANATORY MEMORANDUM




 (Circulated by authority of the Minister for Resources and Energy,
             the Honourable Martin Ferguson AM, MP)




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OFFSHORE PETROLEUM AMENDMENT (DATUM) BILL 2008

GENERAL OUTLINE

The purpose of this Bill is to make a minor technical amendment to the datum
provisions included in the Offshore Petroleum Act 2006 (OPA). There is no policy
change.

This Bill will correct an error resulting from a technical oversight in the Offshore
Petroleum Amendment (Miscellaneous Measures) Act 2008 which inadvertently
replaced all references to the Australian Geodetic Datum (AGD66) with the
Geocentric Datum of Australia (GDA94). The amendments in the Offshore
Petroleum Amendment (Miscellaneous Measures) Act 2008 commenced on 1 July
2008.

Although the advent of global positioning systems justifies the adoption of an
international `geocentric' (earth centred) datum, the OPA still needs to refer to the
AGD66 for the purposes of determining the position of graticular sections or blocks
and refer to GDA94 for certain other purposes including describing coordinates of a
point in a title. If graticular sections or blocks are determined by reference to GDA94
(as the amended OPA currently states), the grid used to determine the position of the
titles will move approximately 200 metres in a north-easterly direction from a grid
that refers to AGD66. This is not the policy intention and would cause concern and
uncertainty for industry if not corrected.

It is proposed that the amendments in Schedule 1 of this Bill have retrospective effect
from 1 July 2008 to provide the following benefits to industry: remove uncertainty
about title boundaries for petroleum titles, ensure alignment between existing and
future titles, and facilitate the award of new exploration permits and the release of
new exploration acreage. There are no adverse effects on industry due to
retrospectivity.

FINANCIAL IMPACT STATEMENT

The Bill will not have any financial impact on the Australian Government Budget as
these are purely technical amendments.

REGULATORY IMPACT STATEMENT

This Bill does not impose any new regulatory burden on the petroleum industry.




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NOTES ON INDIVIDUAL CLAUSES

Clause 1, Short title

Clause 1 is a formal provision specifying the short title of the Bill.

Clause 2, Commencement

Sections 1 to 3 in the Bill will commence from the day the Act receives Royal Assent.

Schedule 1 will commence immediately after the commencement of Item 24 of
Schedule 1 to the Offshore Petroleum Amendment (Miscellaneous Measures) Act
2008 which commenced on 1 July 2008. That is, the amendments in Schedule 1 will
have retrospective effect from 1 July 2008 to provide industry with the following
benefits: remove uncertainty about title boundaries for petroleum titles, ensure
alignment between existing and future titles, and facilitate the award of new
exploration permits and the release of new exploration acreage. There are no adverse
effects on industry. The amendments will give effect to the original policy intention
of the Offshore Petroleum (Miscellaneous Measures) Act 2008.

The commencement sequencing is required to ensure that the amendments to the
Datum Provisions of the Offshore Petroleum Act 2006 contained in the Offshore
Petroleum Amendment (Miscellaneous Measures) Act 2008 commence prior to the
amendments to those provisions in this Bill. This ensures that the amendments made
in this Bill commence in the correct sequence.

Schedule 1, items 1 to 5

These items set out provisions to correct an inadvertent technical error introduced by
the Offshore Petroleum Amendment (Miscellaneous Measures) Act 2008. As
amended by that Act, section 22 of the OPA provides that the position on the surface
of the Earth of a graticular section or block is to be determined by reference to
GDA94.

If graticular sections or blocks are determined by reference to GDA94, the grid used
to determine the position of title boundaries will move approximately 200 metres in a
north-easterly direction from a grid that refers to AGD66. This is not the policy
intention and would cause concern and uncertainty for industry if not corrected.

Items 1 to 5 of Schedule 1 will reinstate AGD66 as the datum by reference to which
the position on the surface of the Earth of a graticular section or block is determined
for the purposes of the OPA. The substantive provision that does this will be new
subsection 21A(1).

This amendment will remove uncertainty about title boundaries for petroleum titles,
ensure alignment between existing and future titles, and facilitate the award of new
exploration permits and the release of new exploration acreage.

The amendments made by this Bill will not affect other changes with respect to datum
that were made by the Offshore Petroleum Amendment (Miscellaneous Measures) Act


                                             3
2008. The other changes provided for the re-defining of the boundaries of the
offshore areas of the States and Territories by reference to GDA94 coordinates and
enabled the position of a point, line, block or other area to be described, in a title or
other instrument, using GDA94 or another datum.

Schedule 1, item 6

Item 6 provides a transitional provision to ensure that any eligible instruments made,
or acts or things done before the commencement of Schedule 1 remain valid and
effective.




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