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Update on the True Fella Pty Ltd v Pantoro South Pty Ltd decision
Following the publication of the True Fella Pty Ltd v Pantoro South Pty Ltd Warden’s Court decision on 24 August 2022, AMEC has been advocating to ensure the security of the mineral titles system in Western Australia.
The True Fella decision casts doubt over the validity of any Exploration Licence application that has not complied with a requirement to set out the work the applicant intends to carry out over the full 5-year term of the Exploration Licence.
Following AMEC advocacy, the Minister committed to ensure the security of granted exploration licences stating that the Government would take “any steps necessary to ensure the validity of granted exploration licences.” This promise has limited the ramifications of the decision to the over 3,400 Exploration Licence applications rather than potentially all Exploration Licences that did not detail their plans for the full five years of the term of tenure upon application.
AMEC has continued to call on the Department of Mining, Industry Regulation and Safety to confirm how it will assess Section 58 Statements going forward. Seeking at a minimum a commitment to continue their assessment, but ideally greater detail of how they consider applications sought.
The Department included a brief statement in the ‘news extra’ section of the RER newsletter, stating ‘The approach taken by DMIRS to assessment and determination of existing exploration licence applications remains consistent, in line with current practices and the requirements of the Mining Act 1978.’
While AMEC welcomes the statement, the Wardens has created an administrative precedent that creates uncertainty in the system. AMEC continues to seek clarity of what DMIRS current practice is for assessing Exploration Licences.
While we are advised that the Department is reviewing the situation, the lack of certainty from the Department on how applications will be assessed creates continued risk in the system. AMEC is seeking a more expansive explanation that outlines how the Department has interpreted the Mining Act so far.
AMEC Advice - consider the risk
AMEC recommends that members carefully consider the implications of the Warden’s Court decision on their live Exploration Licence applications. If you are uncertain, contact the Association to discuss further, or engage a Tenement Manager or a lawyer to quantify the risk you may face and possible courses of action.
While AMEC considers the risk to be relatively low, until the State Government commits or acts to remove these risks, clearly an element of risk remains. Consequently, we are recommending that members ensure all future exploration applications give due consideration to:
A summary of the technical resources available to the applicant. This should ideally include the names any qualified geoscientists or other technical experts implementing the exploration program.
As far as reasonably practicable, describe the applicant's plan and planned expenditure for the 5-year life of the licence and for the full area of the licence, including:
the intended areas of exploration (what areas of the licence are to be subject to the exploration, or the program of work); AND
the reasons for choosing the targeted areas; AND
the target minerals and rationale for exploring for those particular minerals
A statement of financial resources, demonstrating enough funds to meet at least the first-year expenditure commitment for an exploration licence of that size. If possible, detailing the ideally the expenditure commitment for the whole 5 years of the licence. Acceptable statements include:
a bank statement or line of credit in the applicant's name; OR
an ASX report in the applicant's name stating net equity; OR
a financial statement for the applicant prepared by a qualified accountant that states the applicant's net equity.
AMEC realises that this is above the standard said to be required by DMIRS, however it is the only way for companies mitigate the risk arising from the Warden’s Court decision.
AMEC has engaged at length with the Government about the impracticality of providing this information when compared to realities of the iterative nature of modern exploration. Exploration investment develops (or does not) as further geological information is revealed by the application of geoscientific techniques. Anticipating the investment five years into the future of a tenement is an exercise in imagination.
AMEC will continue to lobby government to effectively address the uncertainty caused by the Warden’s Court decision, and to ensure a return to the previous requirements.
The next steps for AMEC are to identify the necessary reforms to the Western Australian legislative framework to reduce the likelihood of similar decisions disrupting the certainty of the tenure system.
Mining Amendment Bill 2022 passes Upper House
New laws that support the ongoing security of Western Australia's mineral titles system passed the Legislative Council last Thursday (October 27).
The Mining Amendment Bill 2022 will improve regulation of WA's resources sector by streamlining administrative processes and safeguarding the security of titles and licences.
One of the Bill's key changes is the adoption of the latest and most accurate geodetic datum - GDA2020. This move will ensure co-ordinates for mining tenements are aligned with the latest standard, which is also used by Global Navigation Satellite Systems.
Explorers Beware: Your Tenure May Now Be At Risk
This week, Warden Cleary delivered her decision in True Fella Pty Ltd v Pantoro South Pty Ltd  WAMW 19. In True Fella, the Warden found that True Fella’s application for an exploration licence (E63/2149) was invalid on the basis the application was accompanied by a non-compliant section 58(1)(b) statement.
Minister secures granted WA exploration tenure
The Department of Mines, Industry Regulation and Safety (DMIRS) is examining a recent Warden's Court decision relating to Pantoro South Pty Ltd's objection to an exploration licence application by True Fella Pty Ltd.
On 18 August, the Warden determined that True Fella's exploration application was invalid, referring to the Section 58 Statement included with the application.
DMIRS will be examining the decision in detail, including any potential impact on the current guidelines provided regarding Section 58 of the Mining Act.
DMIRS continues to ensure the security of title and integrity of the register is of prime importance in the administration of the resources industry in Western Australia.