PETROLEUM (ENVIRONMENT) REGULATIONS 2016

The regulations define several key interconnected concepts that form the analytical backbone of the framework. An environmental impact is any adverse change or potential adverse change to the environment resulting wholly or partly from a regulated activity. Environmental risk is the chance of something happening that will have an environmental impact, measured in terms of consequences and likelihood. These two concepts drive the entire planning and revision regime.

An environmental outcome is an outcome that will be achieved if environmental impacts and risks are reduced to a level that is as low as reasonably practicable and acceptable. Environmental performance standards are standards that relate to the management of those impacts and risks and apply to persons, systems, equipment or procedures involved in carrying out the activity. Measurement criteria are the criteria used to determine whether an environmental outcome or performance standard has been met - the plan must specify these.

The current plan is defined as an environment management plan approved under regulation 11 and in force, together with any conditions to which the approval is subject as specified in the approval notice. This means the plan and its conditions are legally binding. An interest holder is a person who holds a petroleum interest for a regulated activity.

The regulations distinguish between reportable incidents and recordable incidents. A reportable incident is one that has caused or has the potential to cause material environmental harm or significant environmental harm. A recordable incident is an incident that has resulted in an environmental impact or risk not specified in the current plan, or a contravention of an environmental performance standard, or is inconsistent with an environmental outcome - but is not a reportable incident. This two-tier system ensures that less serious incidents are still captured and reported, while the most serious trigger immediate notification requirements.

Stakeholder engagement is defined as engagement carried out in accordance with regulation 7, which requires the interest holder to give each stakeholder information about the proposed activity, its location, anticipated impacts and risks, proposed outcomes, and possible consequences to the stakeholder's rights or activities, and to allow a reasonable period for response. Stakeholders are persons or bodies whose rights or activities may be directly affected by the environmental impacts or risks of the activity.

The regulations also define a full human health risk assessment by reference to specific published guidelines, and incorporate concepts from the Northern Territory Aboriginal Sacred Sites Act 1989 through the requirement for an Authority Certificate to be included in the plan.

The regulations primarily affect interest holders - persons who hold a petroleum interest for a regulated activity. This includes holders of exploration permits, retention licences, production licences, and access authorities under the Petroleum Act 1984. An interest holder is responsible for submitting the environment management plan, carrying out stakeholder engagement, complying with the plan, reporting incidents, keeping records, and ensuring that the activity is conducted in accordance with the regulatory framework.

The regulations also apply to any person who carries out a regulated activity, not just the interest holder. Regulation 30 makes it an offence for a person to carry out a regulated activity for which there is no current plan, with a maximum penalty of 200 penalty units for the strict liability offence and 2,000 penalty units where the person intentionally engages in conduct and is reckless as to the activity being regulated. Regulation 31 similarly prohibits any person from carrying out a regulated activity in a manner that contravenes a current plan. Executive officers of body corporate are specifically exposed to criminal liability: regulation 32A prescribes regulations 30 and 31 for the purposes of section 115(1)(b) of the Act, which imposes liability on executive officers for offences by the body corporate.

Stakeholders are directly affected by the engagement obligations. Stakeholders include persons or bodies whose rights or activities may be directly affected by the environmental impacts or risks of the proposed activity, or their agents or representatives. The regulations give stakeholders a right to be informed and to respond during plan preparation, and for plans involving drilling of a well or hydraulic fracturing, the public has a right to comment: the Minister must publish the plan and invite written comments within 28 days (regulations 8A and 8B). The Minister must take those comments into account when deciding whether to approve the plan (regulation 11(1A)).

The Minister is the decision-maker under the regulations, with powers to approve or refuse plans, impose conditions, require revisions, revoke approvals, and publish information. The Northern Territory Civil and Administrative Tribunal (the Tribunal) has jurisdiction to review certain decisions, and the Supreme Court has jurisdiction for judicial review of decisions specified in Schedule 1A.

The regulations also affect persons who may be given infringement notices (regulation 39), and the Chief Executive Officer who may withdraw infringement notices (regulation 42). Occupiers and owners of land on which activities are carried out must be notified before commencement of construction, drilling or seismic surveys (Schedule 1, clause 12).

The central duty is the obligation on an interest holder who proposes to carry out a regulated activity to first submit an environment management plan to the Minister for approval (regulation 6(1)). The plan must be accompanied by a proposal for environmental security and the prescribed fee (regulation 6(3) and (4)). Before submission, the interest holder must carry out stakeholder engagement in accordance with regulation 7. The plan must include a summary and comprehensive information meeting the approval criteria in regulation 9, and must contain all information required by Schedule 1.

Once a plan is approved, the interest holder and any person carrying out the regulated activity must comply with the current plan. Regulation 31(1) creates an aggravated offence where a person intentionally engages in conduct that is part of carrying out a regulated activity, is the holder of a current plan, and the conduct results in a contravention of the plan with recklessness - maximum penalty 2,000 penalty units. Regulation 31(3) is a strict liability offence for carrying out a regulated activity in a manner which contravenes a current plan - maximum penalty 200 penalty units. A defence of reasonable steps and due diligence is available for both (regulation 31(5) and (6)), and also a defence if the activity is consistent with a modification notified under regulation 22.

The duty to revise the plan arises in two main circumstances. First, if there is a new environmental impact or risk not provided for, or an increase in an existing impact or risk not provided for, the interest holder must submit a proposed revision within 30 days (regulation 17). Second, the plan must be revised at least every five years, with the revision submitted at least 90 days before the end of each five-year period (regulation 18). The Minister may also require a revision by issuing a revision notice (regulation 19), and the interest holder may make a submission arguing why the revision should not be made or should be different (regulation 20).

Incident reporting duties are strict and time-critical. For a reportable incident, notice must be given to the Minister within 2 hours (or within 2 hours of becoming aware if not detected at the time), orally or in writing, with an initial written report within 3 days, interim reports at agreed intervals or otherwise at 90-day intervals, and a final report within 30 days after clean-up or rehabilitation is completed, including a root cause analysis (regulations 33 and 34). For recordable incidents, a written report must be given within 15 days after each reporting period (regulation 35). The period is either agreed in writing or otherwise each 90-day period.

Record-keeping duties are extensive: prescribed records must be kept in Australia for the longer of 5 years after the petroleum interest is in force or 15 years after the record comes into existence (regulation 36). Prescribed records include the original plan, all revisions, monitoring and audit reports, emissions records, calibration records, incident records, waste disposal certificates, stakeholder engagement information, and any other documents developed or received in relation to matters to which the regulations apply.

Rights of stakeholders and the public include the right to be engaged during plan preparation (regulation 7), the right to submit written comments on published plans for well drilling or hydraulic fracturing within 28 days (regulation 8B), and the right to have those comments taken into account by the Minister (regulation 11(1A)). Rights of review are available: an interested person (as defined in Schedule 2) may apply to the Tribunal for review of a reviewable decision (regulation 29), and any person may seek judicial review by the Supreme Court of decisions specified in Schedule 1A, whether or not their rights are affected (regulation 29AA).

The regulations create a graduated enforcement pyramid with substantial maximum penalties for serious offences and a system of infringement notices for less serious breaches. The most serious offences carry maximum penalties of 2,000 penalty units. Regulation 30(1) targets the intentional carrying out of a regulated activity with no current plan where the person is reckless as to that circumstance. Regulation 31(1) targets intentional conduct that is part of a regulated activity where the person is the holder of a current plan and is reckless as to the conduct resulting in a contravention of the plan. At current penalty unit values (which in the Northern Territory are $170 per unit as of 2025), 2,000 penalty units equates to $340,000.

Lower-tier strict liability offences carry 200 penalty units for carrying out a regulated activity with no current plan (regulation 30(3)), or carrying out a regulated activity in a manner that contravenes a current plan (regulation 31(3)). Failing to submit a required revision (regulations 17(3), 18(2), 19(5), 20(3)), failing to notify a modification or change (regulations 22(3), 23(3)), failing to give notice of a reportable incident (regulation 33(5)), failing to give reports on reportable or recordable incidents (regulations 34(8), 35(3A)), failing to keep prescribed records (regulation 36(5)), and failing to make records available (regulation 37(7)) all attract penalties ranging from 100 to 200 penalty units. The hydraulic fracturing reporting offences under regulations 37A(3) and 37B(3) carry 200 penalty units.

Defences are available. For the aggravated offences and the strict liability compliance offences, a defence exists if the defendant took reasonable steps and exercised due diligence to prevent the commission of the offence (regulations 30(5) and 31(6)). For a contravention of the plan, there is also a defence if the activity is carried out in a manner consistent with a modification notified under regulation 22 (regulation 31(5)). The defendant bears the evidential burden for these defences.

Infringement notices are available for the offences listed in Schedule 3, with prescribed amounts ranging from 1 penalty unit for individuals (for offences such as failing to notify a modification under regulation 22(3)) up to 5 penalty units for individuals (for the strict liability offences of carrying out an activity with no current plan or contravening a plan). For bodies corporate, the amounts are multiplied by 5. Payment within 28 days expiates the offence.

Revocation of approval is a significant enforcement tool. The Minister may revoke approval of a current plan on grounds including contravention of the compliance duties (regulation 31(1) or 32(1)), contravention of revision requirements, contravention of an approved access agreement or certain provisions of the Petroleum Regulations 2020, or if an infringement notice was paid for a compliance offence. The Minister must give at least 30 days notice of the intention to revoke, specify reasons, and consider submissions and any remedial action taken by the interest holder (regulation 28). Despite any revocation, a person may still be found guilty of an offence (regulation 27(5)). Executive officers of bodies corporate are criminally liable for offences under regulations 30 and 31 by virtue of regulation 32A and section 115(1)(b) of the Act.

The regulations are made under the Petroleum Act 1984 and interact with that Act at multiple points. Section 6A of the Act requires prescribed decisions to be subject to the principles of ecologically sustainable development, and regulation 5A lists the decisions prescribed for that purpose. The regulations also reference the Act's provisions on access agreements and technical works programmes. Regulation 32A prescribes regulations 30 and 31 for the purposes of section 115(1)(b) of the Act, which deals with executive officer liability.

The Environment Protection Act 2019 is directly integrated. Regulation 9(3) provides that if an activity is required to be referred to the NT EPA under Part 4 Division 3 of that Act, the Minister must not approve an environment management plan unless the NT EPA has determined that an environmental impact assessment is not required, or if one is required, an environmental approval is granted and the decision is consistent with that approval, or the Environment Protection Act otherwise permits the decision. Part 6 of the regulations contains transitional provisions for the commencement of the Environment Protection Act 2019, preserving the application of the pre-existing regulations for certain applications.

The Northern Territory Aboriginal Sacred Sites Act 1989 is relevant through the requirement for an Authority Certificate. Regulation 9(1)(d) requires an environment management plan to include an Authority Certificate in relation to the land on which the activity will be carried out. If an Authority Certificate has not been provided, the Minister is not required to give the interest holder a proposed timetable for consideration beyond 90 days, and must make the decision within 14 days after the certificate is provided (regulation 11(2B)).

Prescribed chemical legislation is defined in regulation 3 and includes the Dangerous Goods Act 1998, Medicines Poisons and Therapeutic Goods Act 2012, Waste Management and Pollution Control Act 1998, Water Act 1992, and Work Health and Safety (National Uniform Legislation) Act 2011. These laws are relevant to the management of chemicals and other substances used in hydraulic fracturing. Schedule 1 clause 4A requires the plan to specify the requirements of the prescribed chemical legislation in relation to chemicals or other substances in treatment fluids. The hydraulic fracturing reporting regulations (37A and 37B) require the report to include these requirements.

The regulations also interact with the Northern Territory Civil and Administrative Tribunal Act 2014, which sets out the procedure for applying to the Tribunal for review of reviewable decisions (regulation 29 note). The Fines and Penalties (Recovery) Act 2001 governs the enforcement of infringement notices, including expiation, election for court hearing, and enforcement actions such as licence suspension, seizure of personal property, wage deductions, and statutory charges on land (regulation 40).

Schedule 1 clause 10 requires the plan to specify any legislative requirements applicable to the regulated activity that are relevant to the protection of the environment, including approved codes of practice, and to demonstrate how those requirements will be met. This captures a range of other NT laws such as the Water Act 1992 and the Waste Management and Pollution Control Act 1998.

The regulations were originally notified on 6 July 2016 and commenced on the same day. They have been amended multiple times. The Petroleum (Environment) Amendment Regulations 2018 (SL No. 27, 2018) and Further Amendment Regulations 2018 (SL No. 28, 2018) both commenced on 19 December 2018. These amendments introduced the public comment provisions (regulations 8A and 8B) and the hydraulic fracturing reporting requirements (Part 3A and Schedule 1 clause 4A), and amended the definition of environment management plan to include proposed revisions.

The Petroleum Legislation Amendment Act 2019 (Act No. 12, 2019) commenced on 15 May 2019 and inserted regulation 29AA providing for judicial review of decisions, and added Schedule 1A listing decisions subject to judicial review. It also amended the heading for Division 7 to include Subdivision 1 (judicial review) and Subdivision 2 (review by Tribunal).

The Petroleum (Environment) Amendment Regulations 2019 (SL No. 7, 2019) commenced on 11 June 2019 and inserted regulation 4A on human health risk assessments, amended regulation 9 on approval criteria, inserted transitional provisions in Part 5, and amended Schedule 1. These regulations dealt with the introduction of the requirement for hydraulic fracturing plans to be accompanied by a full human health risk assessment.

The Environment Protection Act 2019 (Act No. 31, 2019) commenced on 28 June 2020 and inserted Part 6 transitional matters, amended regulations 9, 12, and 13, and deleted the old regulation 4. The Petroleum Legislation Miscellaneous Amendments Act 2020 (Act No. 12, 2020) commenced on 28 June 2020 and inserted regulation 5A which lists decisions subject to the principles of ecologically sustainable development, and amended the definition in regulation 3.

The Petroleum (Environment) Amendment Regulations 2020 (SL No. 33, 2020) commenced on 1 January 2021 and amended regulation 27 to add grounds for revocation relating to infringement notices and breaches of the Petroleum Regulations 2020.

The most significant recent amendment was made by the Petroleum Legislation Amendment Act 2022 (Act No. 33, 2022), which commenced on 22 June 2023. This Act substituted regulations 30 and 31 with new aggravated and strict liability offences, inserted regulation 32A on executive officer liability, inserted new Schedule 3 for infringement notice offences, and made consequential amendments to regulations 3, 5, 6, 14A, 17, 18, 19, 20, 22, 23, 27, 29, 33, 34, 35, 36, 37, 37A, 37B, 41, and Schedule 1. It also substituted Schedule 2.

The most recent amendment is the Petroleum, Planning and Water Legislation Amendment Act 2025 (Act No. 7, 2025), which commenced on 8 April 2025 and amended regulations 29 and Schedule 2. This Act is the most current, as the version in force is dated 8 April 2025.

The regulations themselves do not reference any specific litigation history, and no cases are named in the source text. However, the regulations establish comprehensive review mechanisms that have been the subject of judicial and tribunal proceedings. Regulation 29AA provides that any person may seek judicial review by the Supreme Court of a decision specified in Schedule 1A, which includes a decision to approve a plan subject to conditions or refuse to approve a plan (regulation 11), a decision that a revision is still required (regulation 20), and a decision to revoke approval of a current plan (regulation 27). This right exists whether or not any right of the person has been affected by or as a consequence of the decision.

The Tribunal has jurisdiction to review reviewable decisions as specified in Schedule 2. Those decisions include the issue of a resubmission notice, approval subject to conditions, refusal to approve, requirement for revision, and revocation of approval. Only an interested person as defined in Schedule 2 may apply to the Tribunal for review. The interested persons are limited to the interest holder who submitted the plan or for whom the plan is current.

The regulations also provide for the Minister to take into account submissions before making a revocation decision (regulation 28), and for an interest holder to make a submission in response to a revision notice (regulation 20). These procedural fairness mechanisms are designed to reduce the likelihood of successful legal challenge, but they do not preclude review.

While the source text does not cite any particular case, practitioners should be aware that the Northern Territory Supreme Court and the Civil and Administrative Tribunal have jurisdiction to review decisions under these regulations. The regulations have been in force since 2016 and have been amended several times, so there may be decisions under earlier versions. However, no such decisions are referenced in the provided text, and it would be improper to speculate.

Several provisions contain traps for the unwary. The most critical is the time limit for reporting a reportable incident: notice must be given within 2 hours of the incident first occurring, or within 2 hours of becoming aware if not detected at the time (regulation 33(3)(a)). This is an extremely short window, and compliance requires robust internal monitoring and communication systems. The obligation to give a written notice within 24 hours if oral notice was given (regulation 33(4)) adds another strict deadline.

The definition of reportable incident is broad: an incident that has caused or has the potential to cause material environmental harm or significant environmental harm. The potential to cause harm triggers the obligation, even if no actual harm occurred. This means a near-miss with potential for material harm must be reported within 2 hours.

Another trap is the 30-day deadline for submitting a proposed revision when a new or increased environmental impact or risk arises that is not provided for in the current plan (regulation 17(2)). This is an offence of strict liability with a maximum penalty of 100 penalty units. The trigger is the occurrence itself, not when the interest holder becomes aware of it. This places a heavy burden on the interest holder to continuously monitor for unplanned impacts.

The requirement for a full human health risk assessment to accompany reports on flowback fluid and produced water (regulations 37A(2A) and 37B(2A)) and to accompany the plan itself for hydraulic fracturing (Schedule 1 clause 4A(2)) can be overlooked if the plan or report is prepared without reference to the specific guidelines listed in regulation 4A. The assessment must take into account the Environmental Health Risk Assessment guidelines, the National Environment Protection (Assessment of Site Contamination) Measure 1999, the National Chemical Risk Assessment Guidance Manual, and any other guideline specified by the Minister.

The records retention period is especially onerous. Regulation 36(1)(b) requires records to be kept for the longer of 5 years following the period during which the petroleum interest is in force, or 15 years after the record comes into existence. For a long-lived production operation, records may need to be kept for decades. The requirement to keep records in Australia and in a manner that makes retrieval reasonably practicable (regulation 36(1)(a) and (c)) imposes practical storage and retrieval obligations.

The Minister may revoke approval of a current plan even though no person has been found guilty of an offence in relation to the contravention that gave rise to the revocation (regulation 27(4)). This means that an administrative finding of a contravention, without any criminal conviction, can lead to the loss of the plan and effectively shut down operations. The revocation grounds also include payment of an infringement notice for a compliance offence (regulation 27(1)(ia)).

A less obvious provision is the effect of a transfer of a petroleum interest: the current plan continues to apply to the interest (regulation 14A). The transferee inherits the existing plan and its conditions. However, this does not prevent a revised plan being approved under Division 3. The new interest holder should review the plan carefully to ensure it remains appropriate.

Compliance begins before any regulated activity commences. The interest holder must first develop an environment management plan that meets the form and content requirements of regulation 8 and Schedule 1. The plan must include a comprehensive description of the regulated activity and the existing environment, an assessment of all environmental impacts and risks (including cumulative effects and emergency conditions), specified environmental outcomes, environmental performance standards, and measurement criteria. For hydraulic fracturing, the plan must include full details of chemicals and a human health risk assessment.

Stakeholder engagement is a prerequisite to submitting the plan. The interest holder must identify stakeholders (persons or bodies whose rights or activities may be directly affected), give them information about the activity, location, anticipated impacts, proposed outcomes, and possible consequences to their rights, and allow a reasonable period for response. The plan must include a record of this engagement, including copies of information provided, summaries of responses, assessment of objections, and details of changes made as a result.

The plan must be submitted to the Minister with a proposal for environmental security and the prescribed fee. If the plan relates to drilling a well or hydraulic fracturing, the Minister will publish it for public comment, and the Minister must take those comments into account. The Minister will decide within 90 days (or longer if a timetable is agreed). If the plan is approved, it becomes the current plan, including any conditions specified in the approval notice.

Once the plan is in force, the interest holder must comply with it in all respects. This includes implementing the implementation strategy required by Schedule 1 Part 2, which must provide for ongoing monitoring, recording, audit, management of non-conformance, a clear chain of command, personnel competencies and training, and an emergency contingency plan. The plan must notify the Minister, the occupier, and the owner of land before commencement of construction, drilling or seismic surveys.

The interest holder must monitor for any new or increased environmental impact or risk not provided for in the plan. If such an occurrence arises, a proposed revision must be submitted within 30 days. The plan must also be revised at least every five years, with the revision submitted at least 90 days before the end of each five-year period. If the Minister issues a revision notice, the interest holder must comply within the specified period (at least 21 days) or make a submission arguing against the revision.

Incident management requires a robust system. For any incident with potential for material or significant environmental harm, the interest holder must notify the Minister within 2 hours, provide a written notice within 24 hours if oral notice was given, submit an initial written report within 3 days, interim reports at agreed intervals (otherwise every 90 days), and a final report within 30 days of completion of clean-up or rehabilitation, including a root cause analysis. For recordable incidents, a report must be submitted within 15 days after each reporting period (agreed or otherwise 90 days).

Records must be maintained meticulously. The holder must keep the original plan, all approved revisions, monitoring and audit reports, emissions and discharge records, calibration and maintenance records, incident records and reports, waste disposal certificates, stakeholder engagement materials, and all other documents developed or received in relation to the regulations. These records must be kept in Australia for the longer of 5 years after the petroleum interest is in force or 15 years after the record comes into existence, and must be retrievable. The Minister or an inspector may direct the holder to make copies available, including in emergencies at any time.

Specific additional obligations apply for hydraulic fracturing: a report on flowback fluid must be given to the Minister within 6 months of the flowback occurring, and a report on produced water within 6 months of extraction. Both reports must identify chemicals and naturally occurring radioactive materials, their concentrations, management, transport, treatment, spill prevention, and the emergency contingency plan, and must be accompanied by a full human health risk assessment.

Throughout, the interest holder should be aware of the strict liability nature of most offences and the availability of the due diligence defence. Documenting all steps taken to prevent non-compliance, including training, system checks, and corrective actions, will be critical if an incident occurs.