Clark, Geoff --- "Indigenous People and the Mining Industry: The Adelong Agreement" [1999] IndigLawB 45; (1999) 4(21) Indigenous Law Bulletin 21

Indigenous People and the Mining Industry:

The Adelong Agreement

by Geoff Clark

This paper outlines some of the issues arising out of the recent Adelong Agreement negotiated between the Wiradjuri, Nunawul and Wongalu people of the Tumut region of NSW and Minco, a publicly-listed mining company. The Agreement demonstrates the flexibility of processes available under the Native Title Act 1993 (Cth) ('the NTA') for reaching agreements:

• without a contest about the existence, or otherwise, of native title;
• about specific actions by third parties not party to the agreement itself such as governments; and
• both within and outside the Indigenous Land Use Agreement (ILUA) process.

ILUAs-Panacea or Paradox?

The ILUA provisions of the amended NTA are important-but not pivotal-to the achievement of agreements that:

• allow land use decisions by governments, without the need to establish native title;
• avoid confrontation between Indigenous people and project proponents; and
• enable development to proceed without a final determination of native title issues in relation to the land on which the development is proposed.

The Adelong Agreement- The Miner's Perspective

Minco was a small publicly-listed mining company with Exploration Licences near Adelong in the south west of New South Wales. Following an exploration programme, Minco's board decided in April 1998 to apply for a mining lease from the NSW Government.

There were a number of factors which made recognition of native title in the area subject to the proposed mining lease problematic. There were pastoral runs on the area from the early 1830s. The bulk of the Mining Lease Application (MLA) area was freehold and had been the subject of dozens of pastoral, mining and other interests over a period of 140 years. During a mining boom in the last century, there had also been a large mining town in the area with over 10,000 people residing nearby. A small portion of the MLA area had reverted to the Crown at the end of the last century, and was held by Minco under a lease from the State Government.

The NSW Government took the view that whilst there was a strong likelihood that native title had been extinguished, there was still a strong possibility that the grant of the mining lease might constitute a future act. As part of its 'risk management' strategy, the Government therefore required Minco to 'resolve' the native title issue before the Government would issue the mining lease.

Minco's Position

The company wanted the mining lease issued for commercial purposes within five months, but had neither the philosophical desire to challenge the existence of native title, nor the financial strength to engage in protracted litigation. It simply wanted its lease to be issued without adversely affecting native title rights and interests, if such interests were subsequently found to exist. These decisions were made in the context of the Wik 'Ten Point Plan' debate. There was great legislative and political uncertainty, and Minco could not afford to wait for a resolution in Parliament, since it was not clear if or when this would actually happen.

Minco's Strategy

Minco saw that the only possible way to achieve its commercial objectives and not be dragged into a contest about the existence of native title was to use the non-claimant application process available in the (unamended) NTA. This would reassure the Government sufficiently to persuade it to issue the mining lease. The methodology decided upon was as follows:

• lodge a non-claimant application.
• ensure that no claimant applications were lodged over the nonclaimant application area within the statutory period of two months.^[1]
• this non-claimant application then became an 'unopposed application' under s 64(4) at the end of the section 67(2) period. The Government could then issue the mining lease under the provisions of section 24.
• the unamended NTA provided that the Tribunal had to hold an inquiry into the unopposed application.^[2] However, in seeking a determination of its application, Minco had no desire to seek a determination that native title did not exist.
• Minco's strategy was to seek a series of adjournments of such an inquiry-at least until such time as local Indigenous people had decided whether to lodge a claimant application.
• Minco also considered the possibility of withdrawing its application during the course of the inquiry-this would have prevented a formal determination that native title did not exist.

Minco decided that there was sufficient flexibility in the NTA to satisfy the Government about native title issues, whilst at the same time not necessarily preventing a future application for native title over the area of the mining lease. The company then realised it would need the trust and co-operation of local Indigenous people, so that they would agree not to lodge a claim in the two-month period during which the non-claimant application was being advertised. The only way to achieve this was to approach the local Indigenous community and discuss the issues. Minco wanted a chance to outline the legal problems to them and to propose the benefits of the mining lease to Indigenous people in the local community. This would help build a basis for mutual trust, so that Minco could put forward its suggested solution.

Building a Relationship with the Local Indigenous Community

Minco initially approached the Tumut Brungle Aboriginal Land Council, rather than the NSW Aboriginal Land Council (NSWALC), the representative body established pursuant to s 202 of the NTA. Minco received an open reception from the local Land Council, which advised that the wider local Indigenous community would also need to be consulted and involved in the process.^[3]

Minco insisted the local Land Council should receive expert advice from its representative body in Sydney. The company also arranged to meet with the representative body to explain the proposal and request that the NSWALC assist the Tumut/Brungle Aboriginal Land Council. Minco also asked the local Land Council to identify and explain the company's position and proposal to the traditional owners for the area. Minco was insistent on full community consultation and authorisation.

Formal negotiations commenced and the parties resolved to develop a protocol as the first step towards a negotiation process. Ironically, the protocol took longer to negotiate than the actual agreement. Nevertheless, the protocol was a critical element of the process, as it set out the framework within which the negotiations would take place, and agreed on timelines and objectives. Other important features of the protocol were that:

• each party would deal only through its nominated representatives and there would be no side meetings or 'side deals';
• all negotiations would go between the working party and the nominated representatives of Minco;
• specific rules would be developed on funding assistance by Minco to assist local Indigenous people to make informed decisions; and
• there would be agreement on what each party's objectives in the negotiation process were.

The factions within the local Aboriginal community put aside their differences and came together to form a unified working group.

The non-claimant application was lodged by Minco early in the negotiation process-well before the protocol was settled and well before the Indigenous people's working parry was established. Minco thus demonstrated its trust that local Indigenous people would not thwart the non-claimant process by lodging a claimant application and would be able to prevent any 'outside' people from lodging such an application.

The local Indigenous community lodged a 'provisional' claimant application with the Tribunal with the knowledge and consent of Minco, to make sure that local interest were protected. This had the effect of introducing a common end date to negotiations. If negotiations were not concluded by the end of the 60 day period, then the statutory provisions would have acted to abort the process.

Once the protocol was signed, the actual negotiations took about three weeks. The speed with which those negotiations were concluded was principally because Indigenous people had access to legal, financial and environmental advice.

In the course of the negotiations there was a 'hitch' about compensation. The negotiations had travelled down the traditional track of a royalty to be paid to local Indigenous people on the value of ore produced. Negotiations stalled. Minco proposed abandoning the idea of compensation indexed to a royalty, and suggested instead that the company should make a placement of equity to the Indigenous people so that they shared in the fortunes of Minco, not just from the mineral lease, but from all of Minco's activities. This proposal had the effect of making Minco and the Indigenous community true partners. The proposal was accepted, and negotiations about the mineral lease issue were concluded quickly.

Another issue covered during negotiations was the establishment of a body corporate to hold equity on behalf of the Indigenous community.

The ILUA

At about the same time that the proposed amendments to the NTA were published, Minco and local Indigenous people saw the opportunity for a further agreement in the form of an ILUA or area agreement. Minco had various exploration licences over large areas of southern NSW. The company proposed that the parties enter into an area agreement over the entire local Land Council area in return for further equity placement. Local Indigenous people and the Tumut Brungle Land Council agreed to this proposal.

The representative body was also made a party to this agreement because of the statutory requirement that it must certify ILUAs prior to registration.

Thus, there were two agreements: a contract about the non-claimant process for the issue of the mining lease, and an area agreement permitting future acts by Minco over the area covered by the Land Council.

The mineral lease was finally issued to Minco in October 1998. The area agreement has recently been advertised by the National Native Title Registrar. Unfortunately, it has taken over five months for the representative body and the Registrar to resolve whether the ILUA should be accepted for registration.^[4]

The first placement of equity has been made to the Indigenous body corporate.

Benefits to Indigenous People

The benefits of the process (both the contract and the ILUA) for local Indigenous people included:

• a recognition by Minco that the Indigenous people held interests in the land which had to be recognised and accommodated;
• the right of the Indigenous people to enforce environmental standards;
• involvement in environmental monitoring and archaeological clearance with secure rights to protect significant areas;
• jobs, education and training opportunities and sub-contracting arrangements; and
• a base for economic self-sufficiency through equity in Minco.

Benefits to Minco

The benefits of the contract and the ILUA for Minco included:

• allowing the issue of a mining lease at a strategically important time in its corporate history and in the middle of a tense political debate and uncertainty which had frozen much of the government process, as well as mining activity in many other parts of Australia.
• guaranteeing certainty with respect to native title and future acts in the area covered by the agreements.
• a willing and co-operative Aboriginal workforce within the project area.
• a dramatic improvement in the relationship between the Aboriginal community, the mining company and the wider community since the signing of the agreement.

Lessons to be Learned

The Adelong negotiation process has taught a number of important lessons which confirm the writer's experience in negotiating agreements between Indigenous people and project proponents:

• the NTA is flexible enough to deliver a number of possible outcomes which do not actually require the establishment of native title;
• whilst the ILUA provisions provide an important framework for agreements between Indigenous people and project proponents, they are not the only way to proceed;
• Minco and Indigenous people in south-western NSW demonstrated that by focussing with a positive attitude on the end objective, an outcome acceptable to both parties can be achieved.
• it is important to establish protocols or a framework agreement at the outset. These agreements deal with the process to be followed in the negotiation and include a statements of objectives, stages of negotiations and end dates; and
• agreements need to address the issue of funding to assist Indigenous people in making informed decisions about the matters which they are negotiating.

The central message of the Adelong Agreement process is that by disclosing one's objectives honestly and allowing Aboriginal negotiators to consider matters in their own way, it is possible for the mining industry to make lasting agreements with Indigenous people based on a relationship of trust.

Geoff Clark is former Managing Partner of Phillips Fox Lawyers Cairns; a member of the National Native Title Tribunah Deputy Chairman of the Land Tribunal of Queensland and a member of the Land Court of Queensland He is also a director of the publicly-listed mining company referred to in the article. The views expressed in this article are his personal views and are not those of any organisation or company referred to above.

[1] Under section 67(2) of the NTA.

[2] NTA s 139(a).

[3] It was explained to the writer that although the area in question lies in Wiradjuri country, it was traditionally shared with the neighbouring Nunawal and Wongalu groups.

[4] The writer is not aware of the reasons for the delay but I understand they mainly relate to procedural issues.