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Australian Energy Producers Journal Australian Energy Producers Journal Society
Journal of Australian Energy Producers
RESEARCH ARTICLE (Non peer reviewed)

Encouraging traditional owner participation in onshore unconventional projects

Kenneth Wee
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Deloitte Touche Tohmatsu.

The APPEA Journal 55(2) 438-438 https://doi.org/10.1071/AJ14073
Published: 2015

Abstract

Australia has significant unconventional energy resources that can be tapped to bolster energy security needs and increase contributions to the global energy supply mix—fuelling both domestic and international economic growth.

A key factor underpinning the success of developing onshore unconventional resources is the security of land and tenure access, which allows project proponents to sustainably engage in the exploration, appraisal and development of unconventional gas deposits spread across extensive geographical areas.

These activities occur in areas that are vested in traditional landowners and indigenous native title holders, and have the potential to significantly impact their cultural heritage and their quality and way of life.

It is, therefore, critical, on a number of levels, for project proponents to have the support of this key stakeholder group in ensuring the long-term viability of developing onshore gas resources.

Alignment between the project’s proponents and the diverse range of traditional/indigenous landowners who influence—and are influenced by—their operations, however, is not easy to achieve due to competing interests and motivations.

This extended abstract explores:

  1. alternative participation models for traditional land owners in onshore unconventional gas projects, including production payment and equity-based ownership models;

  2. examples of co-existence arrangements between project proponents and traditional owners;

  3. the impact of fiscal policy on the economic viability of alternative traditional owner participation and co-existence models; and,

  4. the role of state and federal governments in giving incentives to and fostering greater collaboration between project proponents and traditional owner groups.

Kenneth Wee is a tax partner in the oil and gas practice of Deloitte and is a qualified chartered accountant and chartered tax advisor. He has been involved extensively in consulting on a broad range of domestic and international taxation issues, specialising in providing advice on Australian corporate tax and PRRT to the oil and gas industry. His experience includes advising on corporate and international tax structuring for inbound investments into Australia, performing tax model reviews, advising on technical PRRT issues, assisting with due diligence for major multinational oil and gas companies and advising on restructuring, mergers/acquisitions and financing. Kenneth has also been extensively involved in the consultation process relating to the development of legislation extending the PRRT regime to the onshore oil and gas sector.


References

CSIRO, 2015—Onshore Gas. Accessed 22 February 2015. <http://www.csiro.au/en/Research/EF/Areas/Oil-gas-and-fuels/Onshore-gas>.

Government of Western Australia, Department of Mines and Petroleum, 2015—Natural gas from shale and tight rocks. Accessed: 22 February 2015. <http://www.dmp.wa.gov.au/15136.aspx>.

The Australian Government Treasury, 2013—Benefiting Indigenous Communities through Native Title Reform. Assistant Treasurer’s Media Release No. 150, 3 August. ACT: The Australian Government Treasury.

The Australian Government Treasury, 2013—Taxation of Native Title and Traditional Owner Benefits and Governance Working Group Report to Government. ISBN 978-0-642-74922-2, 1 July. Commonwealth of Australia.

The Parliament of the Commonwealth of Australia, 1976—Aboriginal Land Rights (Northern Territory) Act 1976 (Cth). Sydney: AustLII.

The Parliament of the Commonwealth of Australia, 1987—Petroleum Resource Rent Tax Assessment Act 1987 (Cth). Sydney: AustLII.

The Parliament of the Commonwealth of Australia, 1997—Income Tax Assessment Act 1997 (Cth). Sydney: AustLII.

U.S. Energy Information Administration, 2013—Technically Recoverable Shale Oil and Shale Gas Resources: An Assessment of 137 Shale Formations in 41 Countries Outside the United States. Accessed 22 February 2015. <http://www.eia.gov/analysis/studies/worldshalegas/>.