Expectations

Decommissioning in Commonwealth waters is governed by a suite of legislation, policies and standards, as well as a range of international conventions. The figure below provides an overview of key requirements that govern decommissioning in Australia. Note that this list is not exhaustive.

Figure: overview of international conventions, legislation and key policies governing decommissioning in Australia

Australian legislative framework

The Offshore Petroleum and Greenhouse Gas Act 2006 (OPGGS Act) is the primary legislation governing offshore decommissioning. The provisions of the OPGGS Act were recently enhanced when new legislation in 2021 introduced the concept of ‘trailing liabilities’ and increased oversight of changes in control of a title.

Section 572 of the Act is a long-standing, key provision and requires titleholders to:

• maintain all structures, equipment, and property in a title area in good condition and repair.
• remove these when no longer being used in connection with operations authorised by the title.

This requirement has been in the legislation since 1967. Breaches of the requirements entail either criminal or civil penalties. NOPSEMA's policy regarding s572 provides further information.

Before the Joint Authority can agree to allowing a title (or part thereof) to be surrendered, Section 270 of the Act requires NOPSEMA to advise if it is satisfied titleholders have removed, or made other satisfactory arrangements in relation to all property brought into the surrender area, plugged and abandoned all wells, provided for the conservation and protection of natural resources and repaired any damage to the seabed or subsoil to NOPSEMA’s satisfaction, prior to the surrender of the title. NOPSEMA's policy regarding s270 provides further information.

Titleholders should be aware that other legislative requirements may also apply, such as the Environment Protection (Sea Dumping) Act 1981. Sea dumping is regulated by the Department of Climate Change, Energy, the Environment and Water – more information can be found on the Department's website.

Trailing liability

The term trailing liability refers to provisions that are designed to ensure the costs and liabilities associated with decommissioning will be borne by the petroleum industry and not the government or the Australian community.

The trailing liability provisions allows the Minister or NOPSEMA to call back former titleholders, related corporate entities or people related to current or former titleholders to undertake remedial work. The provisions are intended to be a measure of last resort and only used when other measures are deemed to be ineffective.

Instances where these provisions may be used include where a current titleholder is no longer capable (financially or otherwise) of decommissioning the property, or if issues arise in relation to previously decommissioned property.

The trailing liability provisions came into effect on 2 March 2022 and apply to titles as they existed on or after 1 January 2021. Guidelines for how these provisions apply to the decommissioning of offshore petroleum property are available on the Department of Industry, Science and website.

International conventions and standards

Australia is a signatory to a range of international conventions and standards relevant to decommissioning. The UNCLOS framework convention, London Protocol and IMO Resolution A.672 are globally recognised as the main guiding principles for managing the removal of offshore structures and installations, and disposal of associated waste to sea.

Australia is signatory to UNCLOS and the London Protocol, and an IMO member. Therefore, close considerations should be given to requirements of the Protocol Annexes, IMO Resolution and Specific Guidelines.

In addition to the central aspect of infrastructure removal other decommissioning aspects (such as ship pollution, controlled and hazardous waste transport and waste disposal) sit within an international framework. These should also be adequately considered in decommissioning proposals, particularly when evaluating activities associated with vessels, barges and infrastructure or waste that is being taken off title. This includes the requirements of MARPOL 73/78, the Basel Convention and the Minamata Convention, along with associated Australian legislation.