Federal Court of Australia

Mullaley Gas & Pipeline Accord (MGPA) Inc v Minister for Environment and Water [2025] FCA 1526

ORDERS

THE COURT ORDERS THAT:

1.    The application be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THAWLEY J:

OVERVIEW

1    Hunter Gas Pipeline Pty Ltd (Proponent) proposes to construct, operate and then decommission a 50 to 60 km pipeline (the Narrabri Lateral Pipeline or NL Pipeline) to connect the Narrabri Gas Project (NG Project) with the Hunter Gas Pipeline (HG Pipeline). The NL Pipeline would transmit natural gas produced by the NG Project to the natural gas transmission network. The NL Pipeline would be solely for the transmission of gas after coal seam gas (CSG) has been extracted and processed by the NG Project. Some CSG extracted from appraisal wells is already processed and then transmitted from the NG Project production site to a power station.

2    On 7 February 2025, a delegate of the Minister for the Environment and Water decided under s 75 of the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act) that the proposed NL Pipeline – being a proposed “action” (as to which see ss 523 and 528) – was a “controlled action” for the purposes of the “controlling provisions” in ss 18 and 18A (concerning listed threatened species and communities), but not those in ss 24D and 24E (concerning the water impacts of actions involving “unconventional gas development” or “large coal mining development”, and commonly referred to as “water triggers”).

3    Development consent for the NG Project was granted under the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act) on 30 September 2020, and the project was approved by the Minister for the Environment and Water under the EPBC Act on 24 November 2020. The NG Project is subject to the protections of the water trigger “controlling provisions”. The HG Pipeline has been approved under the EPA Act. It was not in dispute that the NL Pipeline is not a component of a larger “action”, encompassing NG Project production, for the purposes of s 74A of the EPBC Act.

4    This proceeding is an application for judicial review under s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act). The applicant is Mullaley Gas & Pipeline Accord (MGPA) Inc, an incorporated entity that represents concerned residents of Mullaley and surrounding districts. The applicant is a “person aggrieved” within the meaning of the ADJR Act – see: s 487(3) of the EPBC Act.

5    The applicant contends that the delegate erred in a way which engages s 5(1)(f) of the ADJR Act in deciding, under s 75 of the EPBC Act, that the water triggers in ss 24D and 24E were not “controlling provisions” for the proposed NL Pipeline “action”.

6    The errors (and central contentions) were identified in the applicant’s Originating Application in the following way:

(a)    The delegate applied the wrong test in determining whether the proposed action involved “unconventional gas development”: Originating Application, particular i. The delegate did not set out the statutory test in the reasons for decision. The delegate purported to apply a test of whether the proposed action was “integral” to the coal seam gas “extractive process”. This misstated and impermissibly limited the test.

(b)    The delegate found that the proposed action was not “integral” to the CSG extractive process, on the basis that infrastructure required to move extracted gas from the gas wells to processing facilities had already been approved: Originating Application, particular ii. In doing so, the delegate erred by proceeding on the incorrect basis that only infrastructure to move extracted gas from gas wells to processing facilities could fall within the statutory test.

(c)    The delegate found that the proposed action was not “integral” to the CSG extractive process because there was some limited existing infrastructure to move gas offsite: Originating Application, particular iii. In doing so, the delegate misconstrued the EPBC Act. The delegate should have applied the statutory test by having regard to the connection between the activities in the proposed action and “unconventional gas development”, and not by reference to whether other alternative infrastructure existed.

(d)    The delegate erred by failing to find that ss 24D and 24E are controlling provisions for the proposed action, in circumstances where the construction of the pipeline was both a practical and legal necessity for the extraction of gas to proceed under the NG Project: Originating Application, particular iv.

7    By its written submissions, the applicant structured its case by reference to two contentions. First, the applicant contended that the delegate failed to identify the correct test (in particular, the correct form of ss 24D and 24E and associated definitions in s 528) and relied instead on the Guidelines as to the content of the statutory test: AS[47] to [51]. Secondly, the applicant contended that the delegate erred in four ways in applying the test: AS[52] to [63]. The applicant confirmed that it did not intend its submissions to travel past the errors contended in its Originating Application.

8    In order to explain why none of the contended errors have been established, it is necessary to say something briefly about aspects of the legislative scheme.

THE LEGISLATIVE SCHEME

9    The statutory scheme of the EPBC Act was explained in detail by Perry J in Australian Conservation Foundation Inc v Minister for the Environment [2021] FCA 550; 390 ALR 157 at [15] to [39] (ACF). ACF concerned a version of the water trigger provisions before amendments made by the Nature Repair (Consequential Amendments) Act 2023 (Cth). Before those amendments, s 24D(1) of the EPBC Act provided:

24D    Requirement for approval of developments with a significant impact on water resources

(1)    A constitutional corporation, the Commonwealth or a Commonwealth agency must not take an action if:

(a)    the action involves:

(i)    coal seam gas development; or

(ii)    large coal mining development; and

(b)    the action:

(i)    has or will have a significant impact on a water resource; or

(ii)    is likely to have a significant impact on a water resource.

10    Although ACF concerned a “large coal mining development”, her Honour also made several observations relevant to “coal seam gas developments”. It is therefore relevant to set out the relevant definitions in s 528 as they relevantly stood when ACF was decided:

coal seam gas development means any activity involving coal seam gas extraction that has, or is likely to have, a significant impact on water resources (including any impacts of associated salt production and/or salinity):

(a)     in its own right; or

(b)     when considered with other developments, whether past, present or reasonably foreseeable developments.

large coal mining development means any coal mining activity that has, or is likely to have, a significant impact on water resources (including any impacts of associated salt production and/or salinity):

(a)    in its own right; or

(b)     when considered with other developments, whether past, present or reasonably foreseeable developments.

11    The proposed action in ACF was the construction and operation of infrastructure to harvest and store water from the Suttor River to provide a secure and reliable water supply to the Carmichael Coal Mine and Rail Project: at [7]. The water supply was intended to provide an alternative water source for the Carmichael Project: at [7]. The water was to be used in the extractive process at the mine: at [75] (quoting the relevant delegate’s reasons at [100]). The delegate had concluded that the proposed activity was “distinct from the process of extracting coal from a mine” and that the “extraction of coal does not form part of the proposed action”, such that “the proposed action is not a coal mining activity, nor does it ‘involve’ coal mining activity”: at [75]. Perry J concluded that the delegate’s decision was wrong because it proceeded on an overly narrow understanding of the connection required by the word “involves” in s 24D(1)(a): at [79], [82], [92], [113] and [114]. Her Honour concluded that the proposed action was so closely associated with the mining of coal as to be integral to it, such that the proposed action “involved” a coal mining activity within the definition of “large coal mining development” in s 528 of the EPBC Act: at [114].

12    As mentioned, the water trigger provisions have been amended. In particular, the reference to “coal seam gas development” has been replaced with “unconventional gas development” and definitions of “unconventional gas development” and “unconventional gas production” have been inserted. The amendments were made to capture new and evolving extraction and recovery technologies, including ones which enabled extraction of gas from layers of shale rock and tight gas reservoirs. The Supplementary Explanatory Memorandum for the Nature Repair (Consequential Amendments) Bill 2023 (Cth) explained (at pp 6 and 11):

4.    The water trigger would be expanded by replacing references to ‘coal seam gas development’ with ‘unconventional gas development’. This latter definition includes other sources of gas extraction or recovery, such as from shale rock or tight gas reservoirs.

…

41.    The definition of unconventional gas development ensures that even though the scope of the water trigger is expanded, the application of the words ‘gas development’ in the context of water resources remains similar to ‘coal seam gas development’.

42.    The definition of unconventional gas production will allow other sources of gas production to be prescribed in the regulations. This ensures that the definition remains relevant even if new extraction or recovery technologies are developed.

13    Section 24D(1) of the EPBC Act as it now stands (with the amendments shown for ease of reference) provides:

24D    Requirement for approval of developments with a significant impact on water resources

(1)    A constitutional corporation, the Commonwealth or a Commonwealth agency must not take an action if:

(a)    the action involves:

(i)    unconventional gas development coal seam gas development; or

(ii)    large coal mining development; and

(b)    the action:

(i)    has or will have a significant impact on a water resource; or

(ii)    is likely to have a significant impact on a water resource.

14    Section 24E(1) contains a cognate provision to s 24D(1) proscribing the same action by creating an offence. It is unnecessary to set it out.

15    The phrase “unconventional gas development” is defined in s 528. That definition in turn refers to “unconventional gas production”, also defined in s 528. The two definitions provide:

unconventional gas development means any activity involving unconventional gas production that has, or is likely to have, a significant impact on water resources (including any impacts of associated salt production and/or salinity):

(a)     in its own right; or

(b)     when considered with other developments, whether past, present or reasonably foreseeable developments.

unconventional gas production means extraction, recovery, or intentional release, (whether by drilling, hydraulic fracturing or other means) of gas from:

(a)     coal seams or beds; or

(b)     layers of shale rock; or

(c)     tight gas reservoirs; or

(d)     any other sources prescribed by the regulations.

16    Sections 24D(1) and 24E(1) have two limbs. The first limb directs attention to whether the action “involves”, relevantly, “unconventional gas development”. The second limb directs attention to whether the action has, will have, or is likely to have, a significant impact on a water resource.

17    The delegate in the present case was not satisfied that the proposed action fell within the first limb and therefore did not consider the second limb.

18    The definition of “unconventional gas development” directs attention to two broad matters. The first matter is whether there is “any activity involving unconventional gas production”. The second matter is whether that activity “has, or is likely to have, a significant impact on water resources” either: (a) in its own right; or (b) when considered with other developments, whether past, present or reasonably foreseeable developments.

19    The definition of “unconventional gas production” directs attention to two broad matters. The first matter is whether there is “extraction, recovery, or intentional release … of gas”. The second is the source of the extracted gas, that is whether the gas comes from coal seams or beds, layers of shale rock, tight gas reservoirs or any other source prescribed in relevant regulations.

20    Although s 24D(1), s 24E(1) and the relevant definitions direct attention to various matters, they are to be read as a whole, with each other, and in context, including the objects of the EPBC Act. The interaction between s 24D(1) and the definitions of “coal seam gas development” (now “unconventional gas development”) and “large coal mining development”, was usefully analysed by Perry J in ACF at [85] to [88].

21    The parties embraced Perry J’s central conclusion about the scope of the word “involves” in ss 24D(1) and 24E(1), although of course it is ultimately the statutory language itself which is the surest guide. If one were to adapt that central conclusion to the term “unconventional gas development” – which the parties submitted is an appropriate way to consider the issues – then “an action will involve [unconventional gas development] for the purposes of the water trigger controlling provisions if the action is so closely associated with [unconventional gas production] as to be integral to it”: ACF at [11].

22    The definition of “unconventional gas development” includes the word “involving”. The applicants emphasised the double use of the concept (both in ss 24D and 24E and in the definition of “unconventional gas development”). This was said to broaden the range of matters which might be captured by the provisions as compared to the provisions as considered by Perry J: AS[25] and [37]. It should be observed in this regard that the definition of “coal seam gas development” – set out at [10] above and considered by Perry J in ACF – also included the word “involving”.

23    The connection required by the word “involving” in the phrase “any activity involving unconventional gas production” in the s 528 definition of “unconventional gas development” is not a narrow one. The word “involving” should be understood in an equivalent way to the word “involves” in s 24D(1).

24    The water trigger provisions have limits and are not intended to bring the Commonwealth into all actions that are likely to have impacts on water resources. As the Minister submitted, the purpose of ss 24D and 24E of the EPBC Act is to ensure that the Minister takes into account “the impacts of coal seam gas [now unconventional gas development] and large coal mining on water resources” rather than to be “a broad trigger” to “invoke the Commonwealth in all water decisions” – see: Second Reading Speech to the Environment Protection and Biodiversity Conservation Amendment Bill 2013 (Cth) (Hansard, House of Representatives, 13 March 2023, pp 1846–7); s 3(2)(a) of the EPBC Act.

25    In ACF at [82], Perry J accepted that s 24D of the EPBC Act does not apply “to the universe of actions that are likely to have impacts [on] water resources”; rather, “only a subset of actions which may have a significant impact on water resources are protected, the purpose of subs (1)(a) of ss 24D and 24E being to require that there is a connection between the action and specific kinds of developments” (emphasis in original).

26    If the taking of an action, for the purposes of a controlling provision, involves unconventional gas development, and the Minister believes that the taking of the action is likely to have a significant impact on water resources, and may have an adverse impact on a matter protected by a provision of Pt 3, then – before the Minister decides whether or not to approve the taking of the action – the Minister must obtain the advice of the Independent Expert Scientific Committee on Unconventional Gas Development and Large Coal Mining Development: s 131AB of the EPBC Act.

27    The definitions of “coal seam gas development” and “large coal mining development” existed before ss 24D and 24E. As Perry J observed in ACF at [46], those definitions were inserted into s 528 by legislation which established the independent Expert Committee in Pt 19, Div 2B of the EPBC Act. The definitions defined the research and advisory functions of the Expert Committee and the circumstances in which its advice must be sought and taken into account. As Perry J observed in ACF at [39], the Minister must ensure the independence of each member on appointment, and that each member (other than the Chair) possesses appropriate scientific qualifications or expertise, with a majority in one or more of the following areas: geology, hydrology, hydrogeology and ecology: s 505C(2), (5) and (6). In the Second Reading Speech for the Environment Protection and Biodiversity Conservation Amendment Bill 2013 (Cth), the Minister for Sustainability, Environment, Water, Population and Communities explained that:

The independence of the expert committee provides the community with the confidence they need that the scientific work being done has the integrity that people want.

28    It follows from the terms of ss 24D and 24E and the associated definitions of “unconventional gas development” and “unconventional gas production” that a project involving the installation of a gas transmission pipeline for the sole purpose of transmitting natural gas from a conventional gas development (such as offshore and onshore reservoirs) could not be subject to the water trigger provisions. Natural gas – whether from a conventional or unconventional gas development – is transmitted in pipelines which meet Australian Standard 2885. There is an extensive network of pipelines in Australia supplying natural gas to consumers, being natural gas from both conventional gas developments and unconventional gas developments.

29    The Proponent observed that it would be a curious result if a pipeline for transmission of natural gas sourced from a conventional gas development could not be subject to the water trigger provisions, or the requirement to obtain advice from the Expert Committee, but a pipeline for transmission of natural gas sourced from an unconventional gas development is sufficiently integral to unconventional gas production as to attract the first limb of the water trigger provisions and (assuming the other requirements of s 131AB are satisfied) the requirement for advice from the Expert Committee.

30    Whilst there is substance to that observation, it is preferable to engage directly with the issues which arise in this particular case, namely whether the applicant has established that the delegate erred in the ways contended in its Originating Application.

THE APPLICANT HAS NOT ESTABLISHED THAT THE DELEGATE ERRED

The delegate did not err by failing to identify the correct test

31    The applicant contended that the delegate erred for the purposes of s 5(1)(f) of the ADJR Act by failing to set out or identify the correct test and that “the test that the delegate should have applied was whether the action is so closely associated with the production of unconventional gas as to be integral to it”: AS[47] and [48]. The applicant also submitted that “the delegate relied on the Guidelines as to the content of the statutory test” rather than the statute itself: AS[49].

32    Reasons of administrative decision-makers should be read practically and in a balanced and common-sense manner: Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; 185 CLR 259 at 271–2.

33    The issue is whether – reading the reasons fairly and in context – error has been shown, not whether something could have been better expressed or was unhappily phrased. As to what inferences might be drawn from what is, and what is not, stated in the reasons, it is generally relevant to consider the nature of the decision-making body and the particular statutory context: Stojic v Deputy Commissioner of Taxation [2018] FCA 483; 107 ATR 741 at [104]; Endeavour Coal Pty Ltd v Association of Professional Engineers, Scientists and Managers, Australia [2012] FCA 764; 206 FCR 576 at [36]. The statutory context here included that the statute addressed an issue of significant public and environmental importance. The Minister was required to take public comments into account: s 75(1A). The Minister had to decide whether the action was a controlled action, and which provisions of Pt 3 of the EPBC Act were “controlling provisions”, within 20 business days of receiving the referral: s 75(5). Although required to make the decision in “studied haste” (Wilderness Society v Minister for Environment and Water Resources [2007] FCAFC 175; 166 FCR 154 at [84]; ACF at [26]), the Minister was required to provide reasons within 28 days of a request: s 77(4)(b). In the present case, the reasons were in fact provided after 28 days had elapsed.

34    The delegate identified ss 24D and 24E and made her decision by reference to those provisions. The delegate’s conclusion was that, although the proposed action was for the movement of gas produced by the NG project (R[83]), ss 24D and 24E were not controlling provisions for the proposed action because the proposed action was not for the extraction of CSG and was not integral to the extraction of CSG: R[90] and [91].

35    In reaching that conclusion, the delegate was addressing the correct (amended) provisions. The reasons included references to “unconventional gas development”, being a phrase used in the amended provisions, in the context of ss 24D and 24E (emphasis added):

A water resource, in relation to a large coal mining development or unconventional gas development (sections 24D and 24E)

80) The majority of public comments provided on the referral referred to impacts on water resources and specified that the project should be determined a controlled action due to significant impacts on a water resource, in relation to a large coal mining development or unconventional gas development (sections 24D and 24E) (referred to as the water trigger)

36    The delegate was not obliged to set out the statutory provisions in full as a condition to making a legally valid decision: Australian Conservation Foundation Inc v Minister for the Environment [2016] FCA 1042; 251 FCR 308 at [162].

37    I do not accept that the delegate failed to identify the correct statutory provisions.

38    As mentioned, the applicant also contended that the delegate’s references to “extractive process” demonstrated that the delegate substituted the Guidelines for the statute: AS[49].

39    The delegate’s references to CSG “extractive process” or “extraction activities” do not suggest that the delegate had the wrong provisions in mind or that she substituted the Guidelines for the statute. The NG Project was one for coal seam gas extraction and not a different form of “unconventional gas production”. The definition of “unconventional gas production” refers to “extraction, recovery or intentional release”. The context was that the proposed activity was one to transmit, via pipeline, gas which had been extracted and processed by the NG Project. In that context, there was nothing unusual about the delegate referring to the “extractive process”. That reference, and other references to extraction, are unremarkable and to be expected. The connection of the proposed activities with the extraction process was a centrally relevant consideration and the word extraction is used in the definition of “unconventional gas production”.

40    The delegate did not use the Guidelines as a substitute for the statute.

The delegate did not err in applying the test

The delegate did not treat the examples in the Guidelines as exhaustive

41    Contrary to the applicant’s submission, the delegate did not treat the examples in the Guidelines as “exhaustive”: AS[53] and [54]. In her reasons at R[82], the delegate stated that the Guidelines “expands on activities that could be considered an integral part of the extractive process and are therefore covered by the water trigger” and referred to “[a]n example” in the Guidelines (emphasis added). The Guidelines made it clear that the relevant examples were just that and that proposals would be considered on a case by case basis. The relevant part of the Guidelines stated (CBB790):

While proposals will be considered by the department on a case-by-case basis, the following are examples of activities that are likely to be considered an integral part of the extractive process:

•    construction, operation and decommissioning of open-cut and underground coal mines or CSG wells

•    construction, operation and decommissioning of infrastructure to provide water supply for use in the extraction of CSG or coal, including the use of water in activities such as cooling cutting surfaces and mining equipment, or dust suppression

•    management of water generated as a result of extraction of CSG or coal, such as holding dams or water treatment facilities

•    disposal of water produced from coal mining or CSG extraction into streams/rivers

•    management of waste generated as a result of extraction of CSG or coal, such as spoil heaps

•    construction of infrastructure to provide power necessary for the operation of a mine, including relocated power lines

•    construction of infrastructure to enable mining or CSG operation inputs which are integral to coal or CSG extraction to be received, and product, equipment or waste which are integral to coal or CSG extraction to be taken off the mine-site

42    The delegate stated at R[83]:

The department has considered the Significant Impact Guidelines 1.3 in detail and although the proposed pipeline is for the movement of gas, the proposed action is not considered integral to the CSG extractive process given:

a)     it does not provide water, electricity or other resources necessary in the extraction process;

b)     it does not move equipment or waste offsite and it is not necessary for the management or movement of equipment or waste; and

c)     the infrastructure required to move product from the gas wells has already been approved through the Narrabri Gas Project. Activities approved under the Narrabri Gas Project included necessary pipelines to transfer gas from the gas wells to the processing and compression facilities

43    Reading the reasons fairly, the delegate considered and used the Guidelines to assist in assessing the connection between the proposed action and the relevant “unconventional gas development”. The delegate accepted that the proposed action had a connection with the extraction of the CSG at the NG Project because the proposed pipeline was for the movement of gas once processed, but – notwithstanding – concluded that the connection was insufficient for the purposes of ss 24D(1) and 24E(1).

The existing pipelines to move CSG from wells to processing and compression facilities

44    Pipelines which move extracted CSG from the wells to the processing and compression facilities within the NG Project have already been approved. The delegate referred to that fact at R[83(c)]. The applicant contended that the delegate erred by treating that fact as meaning that the proposed NL Pipeline transmitting processed natural gas away from the NG Project to the consumer market via the HG Pipeline could not be integral in the relevant sense: AS[55] and [56].

45    This contention does not accurately reflect the delegate’s reasoning. The delegate examined the Guidelines and the examples in it and assessed the particular facts of the case before her to reach a decision. One of the matters to which the delegate had regard in assessing the connection between the proposed activity and “unconventional gas development” was the fact that the proposed activity did not transmit extracted CSG from the wells to the processing facilities within the NG Project from which the end product would be transmitted.

46    The fact that the NL Pipeline did not move CSG from the wells to the processing and compression facilities was plainly relevant. If the NL Pipeline was involved in moving CSG from extraction wells to processing and compression facilities within the NG Project, then the proposed activity was far more likely to “involve” “unconventional gas development” because the pipelines might be seen to be integral to the production of gas in the processing and compression facilities.

47    Contrary to the applicant’s contention, the delegate did not reason that, because the NL Pipeline was not involved in moving CSG from extraction wells to processing and compression facilities, it could not fall within s 24D or s 24E.

The delegate did not treat existing infrastructure as excluding other pipelines as integral

48    The applicant contended that the delegate erred in finding that the proposed NL Pipeline “was not integral to CSG extraction because there was some existing infrastructure to move gas offsite”: AS[57]. In advancing this contention, the applicant focussed on the delegate’s reasons at R[87] and R[88]. It is necessary to read those paragraphs in the context of the immediately preceding paragraphs.

49    The delegate noted that many public comments contended that construction of the proposed pipeline was “integral” to the NG Project because the NSW Development consent for the project requires a gas transmission pipeline: R[84]. The delegate referred to condition A9 of the NSW Development consent which, amongst other things, required the Proponent not to commence Phase 2 until a planning approval had been granted for a transmission pipeline to deliver gas from the NG Project to the domestic gas network: R[84]. Phase 2 was one of four stages referred to in condition A5 and comprised construction activities for production wells and related infrastructure: R[85].

50    The delegate then stated at R[86] (emphasis added):

The department notes that the NSW Statement of Reasons for the Narrabri Gas Project at [17] justified the inclusion of condition A9 due to uncertainties about how the project would connect to the larger gas network. At the time of the decision, the proponent was not seeking approval for the construction of a new pipeline or extension of an existing pipeline. The department advised that this condition is inherently a planning step, designed to ensure that the construction of the Narrabri Gas project would not be undertaken without certainty for the energy market.

51    Paragraph 17 of the NSW Statement of Reasons in respect of the NG Project (referred to in the quote above) stated:

Prior to producing gas, the [Proponent] will need to connect the Project to a gas pipeline network, which at present is not available in proximity to the Project Area. The [Proponent] is not seeking approval for a new pipeline or an extension to an existing pipeline as part of this Project. The Department notes at ARP 72 that there are two possible options for the pipeline connection; however, there are uncertainties with both options. Therefore, the [Proponent] agreed with the Department to accept a condition on any development consent for this Project requiring it to ensure there is an approved pipeline connection to the Project prior to starting Phase 2 construction and that this connection is in place and commissioned prior to starting any gas production under Phase 3.

52    Returning to the delegate’s reasons, the delegate then stated at R[87] and [88]:

Furthermore, the department suggested that condition A10 of the NSW development consent states that condition A9 of the NSW development consent does not prevent gas from the development being sent to the Wilga Park Power Station or any local industry. Condition A10 states:

A10.     Condition A9 does not prevent gas from the development being sent to the Wilga Park Power Station or any local industry.

Given the above NSW condition is a planning step, the department advised that the proposed pipeline is not integral to extraction activities associated with the Narrabri Gas Project. In particular, the department advised that gas is already being obtained and processed from Narrabri Gas appraisal wells referred under EPBC 2013/6918 (determined to be not a controlled action if taken in a particular manner on 1 October 2013). This gas is already being supplied to the Wilga Park Power Station.

53    The delegate was considering the public comments to the effect that the NL Pipeline was integral because the NSW Development consent required a gas transmission pipeline. The delegate accepted the Department’s view that the relevant NSW Development consent condition was in the nature of a “planning step”. That view was supported by the fact that some CSG was already being extracted from NG Project appraisal wells, processed and then transmitted to the Wilga Park Power Station.

54    Contrary to the applicant’s contention, the delegate did not conclude that the proposed NL Pipeline “was not integral to CSG extraction because there was some existing infrastructure to move gas offsite”: AS[57].

The contention that the NL Pipeline was required for commercial and legal reasons

55    The applicant contended that the delegate erred by failing to consider that the construction and operation of the NL Pipeline under the proposed action was required for the production of gas to proceed under the NG Project, both as a practical and legal matter: AS[59]. The applicant’s argument was, in essence, that the proposed action is caught by the water triggers because it is “critical to enable gas production” as “a practical commercial matter as well as a legal matter”: AS[59] to [63].

56    The applicant contended that “transport of the gas to market is not a distinct and separate step from its extraction, but rather a necessary and critical aspect of the production process” as well as “a legal requirement under the development consent for the [NG Project] for gas production to proceed”: AS[60] and [62]. In support of that submission, it referred to Harvey v Minister for Primary Industry and Resources [2024] HCA 1; 278 CLR 116 at [63] (Gageler CJ, Gordon, Steward and Gleeson JJ), in which the High Court observed that the “treatment, processing, storage and transport of a mine’s product following extraction of a mineral may also constitute a part of a given mining project” (applicant’s emphasis): ARS[14].

57    As the applicant acknowledged, reference to different terms in different statutory schemes risks distracting attention from the particular words in the statutory scheme in issue. In any event, as the Minister submitted, the reference in Harvey at [63] to “transport of a mine’s product” as possibly forming part of a given mining project are not necessarily as helpful to the applicant as it submits.

58    The expression “mining operations” is wide and not inflexible: Parker v Federal Commissioner of Taxation [1953] HCA 80; 90 CLR 489 at 494 (Dixon CJ, Webb J agreeing). To fall within the expression, operations must pertain to mining, but the cases do not support a conclusion that transport of the end product after production falls within the phrase.

59    The fact that “mining operations” are generally seen to have come to an end once the end product is produced was referred to by the High Court in Harvey at [63(3)]:

Generally the mining operation will continue until there has been produced that which is the object of the particular taxpayer’s operation of mining.

60    That proposition finds support in Federal Commissioner of Taxation v Broken Hill Pty Co Ltd [1968] HCA 16; (1969) 120 CLR 240. The High Court (Barwick CJ, McTiernan and Menzies JJ), after considering (at 272–3) what would comprise “mining operations” in various industries and circumstances, stated (at 274):

The taking away from the mining property of ore which has been mined, whether that be done by the mining company or by someone else, is a step subsequent to the conclusion of the mining operations.

61    In Commissioner of Taxation v Northwest Iron Co Ltd [1986] FCA 93; 9 FCR 463, the Full Court (Bowen CJ, Toohey and Lockhart JJ) held that a pipeline which was essential to producing the taxpayer’s end product (pellets) fell within the taxpayer’s “mining operations”: at 474–5. The pipeline was “not different in essence from a necessary conveyor line conveying material from one section to another within a mining complex”: at 475. The case does not support a proposition that transport of the pellets after production would form part of “mining operations”.

62    Indeed, absent close association with extraction, or integration with the actual mining process, activities directed to improving that which is extracted often fall outside the ambit of the “mining operations”. Referring to Northwest Iron¸ the High Court in Harvey stated at [63(6)]:

Activities directed to improving that which is extracted, for example pelletising, may fall outside the ambit of the ‘mining operation’. However, they may form part of the mining operation where the activity is closely associated with the actual extraction of the mineral. Normally this close association may be indicated by physical proximity, but lack of physical proximity will not necessitate the conclusion that the mining operation has concluded: Northwest Iron [(1986) 9 FCR 463]. The degree of integration of the activity with the actual mining process will, obviously, thus be relevant.

63    In Federal Commissioner of Taxation v Reynolds Australia Alumina Ltd [1987] FCA 638; 18 FCR 29 at 35 (referred to at fn 82 in Harvey at [63]), Beaumont J emphasised the importance of the connection of the activity in question to the various activities at the mine site, especially the recovery, withdrawal and movement of the product. His Honour observed (citations omitted):

… [T]he ultimate question of characterisation … is whether the conveyor facility may fairly be seen to be part of the activities carried on at the mine site in the sense of being ancillary to those activities or whether, on the other hand, the conveyor facility should be perceived as something which stands apart from, and is independent of, the activities at the mine site.

The conveyor facility should, I think, be seen as something ancillary to the activities at the mine site and therefore part of the mining operations conducted by the respondents. As has been said, to determine when mining operations begin and end is one of fact and degree. The considerations which, in my view, indicate a sufficient connection for present purposes between the conveyor operations and the actual process of winning the product at the mine site are as follows: First, the circumstance that the conveyor belt activity commences within the mine site area is, I think, significant. It emphasises the physical proximity between the various activities at the mine site, especially the recovery, withdrawal and movement of the mineral product. The conveyor is anchored, so to speak, in the mine site. Secondly, the conveying of the product is part of a single, integrated operation which commences at the surge pile and continues until the product is dumped and then blended at the stockpiles at the refinery. Given this proximity and this integration, any attempt to fragment the respondents’ activities into a number of distinct compartments must run the risk of producing an artificial and unrealistic result.

64    In Robe River Mining Co Pty Ltd v Commissioner of Taxation [1990] FCA 648; 21 ATR 1068, referred to at fn 83 in Harvey at [63], Lee J accepted that railway equipment used to transport iron ore to a port where a crushing facility was located constituted the use of machinery in carrying out mining operations: at 1079.

65    Neither Reynolds, nor Robe River, support a proposition that transport of the final product away from the production facility constitutes a part of mining operations.

66    In any event, as has been mentioned, these cases concerned a quite different statutory context, and risk distracting attention away from the critical issues. It is necessary to focus on the particular terms of the EPBC Act, construed in context, including the statutory objects: Harvey at [64].

67    Sections 24D(1) and 24E(1) require the delegate to consider whether the action “involves” “unconventional gas development”. This requires the delegate to consider whether the action involves “any activity involving unconventional gas production” (emphasis added). The definition of “unconventional gas production” refers to “extraction, recovery or intentional release … of gas” from specified sources. The definition does not expressly refer to the transmission of gas after extraction and processing. Put another way, the definition does not expressly refer to the transmission of gas after unconventional gas production. Of course, it is necessary to keep steadily in mind that an issue raised by the definitions is whether the activity is one “involving” unconventional gas production. An activity can “involve” unconventional gas production without in fact being unconventional gas production – see [22] above. An activity can “involve” extraction or recovery of gas without in fact being an extraction or recovery activity. To take a simple example, processing and compressing extracted gas at a mine site might be seen to be an “activity involving unconventional gas production” or an activity involving extraction given its close association to, and integration in, the production process.

68    For practical, commercial and legal reasons, the Proponent would be required to ensure that the CSG once extracted is not released into the environment and would be required, after the extracted CSG is processed, to transmit the final product to market. None of that necessarily makes the NL Pipeline a “proposed action” which “involves” “unconventional gas development” or “unconventional gas production”.

69    It was open for the delegate to conclude, and the applicant has not established that the delegate erred in concluding, that the “proposed action” (which included the construction and operation of the NL Pipeline to transmit gas to the market after CSG had been extracted and processed) was not an action which “involves” “unconventional gas development”. It was open to conclude that the series of activities (see ss 523 and 528) comprising the NL Pipeline action (including the transmission of the extracted and processed gas from the NG Project) did not involve “unconventional gas production”, and that the series of activities was not integral to the “extraction, recovery or intentional release … of gas”.

70    It is unnecessary to decide whether the transmission of gas after extraction and processing could never be an action which “involves” “unconventional gas development”, as I understood the Minister to submit. It is sufficient for the resolution of this case to observe that the delegate’s conclusions were open on the material before the delegate and that the delegate’s reasons do not demonstrate any error within s 5(1)(f) of the ADJR Act.

71    The applicant’s submission that the delegate’s decision is inconsistent with the result in ACF is not sustainable. As mentioned, ACF concerned a proposed action which would involve harvesting and storing water to provide a secure and reliable alternative water supply to be used in the extractive process: ACF at [75] (quoting the relevant delegate’s reasons at [100]). The delegate considered that the proposed activity was “distinct from the process of extracting coal from a mine” and that the “extraction of coal does not form part of the proposed action”. Unsurprisingly, Perry J concluded that the action “involved” “large coal mining development”, because it was so closely associated with the mining of coal as to be integral to it, such that the proposed action involved a coal mining activity within the definition of “large coal mining development” in s 528 of the EPBC Act: at [114]. The present case is quite different. It was uncontroversial that the proposed action (the NL Pipeline) was for transmitting the final product, after extraction and processing. The NL Pipeline would not be used in the process of extraction or processing. Transmission of gas would occur after production. The NL Pipeline would be physically connected to the NG Project, but not used within it to move CSG from extraction wells to processing and compression infrastructure. It was open to the delegate to conclude that the NL Pipeline did not involve unconventional gas production or unconventional gas development.

72    The applicant has not established that the delegate erred in concluding that ss 24D(1)(a)(i) and 24E(1)(a)(i) were not engaged.

CONCLUSION

73    Whether or not another conclusion was open, the applicant has not established that the delegate failed to identify the correct statute, or treated the Guidelines as a substitute for the statute, or otherwise erred in applying the statute. The application for judicial review must therefore be dismissed.

Associate:

Dated:    4 December 2025