Multiple Titleholders: Service of Documents, Taking Voluntary Actions and Discharging Legal

MULTIPLE TITLEHOLDERS: SERVICE OF DOCUMENTS, TAKING VOLUNTARY ACTIONS AND DISCHARGING LEGAL OBLIGATIONS GUIDELINE

A Guideline in relation to the Offshore Petroleum and Greenhouse Gas Storage Act 2006

Prepared by the Commonwealth Department of Resources, Energy and Tourism

Effective 1 January 2012

PLEASE NOTE: as of 1 January 2012 the National Offshore Petroleum Titles Administrator (NOPTA) will be the first point of contact on all issues relating to offshore petroleum and greenhouse gas storage titles administration and data management.

PURPOSE

This Guideline outlines the procedures that have been adopted to ensure a uniform and consistent approach to the service or receipt of legal documents by the Joint Authority, NOPTA, and the responsible Commonwealth Minister under the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (OPGGSA), where there are two or more registered holders of a petroleum or greenhouse gas title.

The joint nomination by the registered holders of a title granted under the OPGGSA of a single address for the service of documents, pursuant to section 774 (petroleum titles) or 775 (greenhouse gas titles) of the OPGGSA, is not compulsory; however it is encouraged in the interests of efficiency.

This Guideline also outlines arrangements in relation to multiple titleholders and eligible voluntary actions taken under the OPGGSA. The joint nomination by the registered holders of a title granted under the OPGGSA of a single titleholder to undertake eligible voluntary actions on behalf of the group of titleholders, pursuant to section 775B (petroleum titles) or 775C (greenhouse gas titles) of the OPGGSA, is required in order for the group of titleholders to validly undertake such voluntary actions – refer to subsections 775B(5) and 775C(5) respectively. The nomination requirements were added to the OPGGSA in 2010 and were intended to set in legislation and put safeguards around a practice already commonly adopted by industry in making applications and providing other notices to regulators; that is, in the case of joint venture partners, one partner nominated by the other joint venturers to make the applications/notices on behalf of the other partners. These provisions aim to achieve regulatory efficiencies and streamlining – they do not alter or reduce rights of individual titleholders within a titleholder group. The formalisation of a nomination process also serves as a form of protection for multiple titleholders, ensuring that the regulator will only accept applications/notices, which may result in legal obligations on all titleholders, from the nominated titleholder on behalf of the titleholder group. Having a formal nomination of a representative titleholder acknowledged by all holders of the title also provides a level of certainty for the regulator, on receipt of applications/notices from the nominated party, that the eligible voluntary action represents the agreed position of all titleholders. While on the face of it, the nomination process may appear to represent a burden on titleholders in the mandatory nature of establishing the arrangement, it in fact provides greater efficiencies thereafter, as a course of action agreed by all titleholders can be achieved by having the eligible voluntary action taken by one (nominated) titleholder, rather than requiring execution by all titleholders to validly undertake further eligible voluntary actions ie. to enable the submission of every application or notice pertaining to the title. Importantly, if any individual titleholder is not satisfied with the current nominee, that single titleholder has the ability to revoke the nomination.

This Guideline also describes the valid discharge of legal duties (obligations) applicable to a title where there are two or more registered titleholders.

It is anticipated this Guideline will be amended from time to time. A current version of this guideline is available on the Internet at www.nopta.gov.au.

1. DEFINITIONS OF PETROLEUM AND GREENHOUSE GAS TITLES AND REGISTERED HOLDERS

1.1. For the purposes of service and receipt of legal documents and discharge of obligations, petroleum title is defined in subsections 774(7), 775B(8) and 775D(3) of the OPGGSA as:

(a) a petroleum exploration permit; or

(b) a petroleum retention lease; or

(c) a petroleum production licence; or

(d) an infrastructure licence; or

(e) a pipeline licence; or

(f) a petroleum special prospecting authority; or

(g) a petroleum access authority.

1.2. For the purposes of service and receipt of legal documents and discharge of obligations, greenhouse gas title is defined in subsections 775(7), 775C(8) and 775E(3) of the OPGGSA as:

(a) a greenhouse gas assessment permit; or

(b) a greenhouse gas holding lease; or

(c) a greenhouse gas injection licence; or

(d) a greenhouse gas search authority; or

(e) a greenhouse gas special authority; or

(f) (for the purposes of sections 775C and 775E) an infrastructure licence in relation to infrastructure for engaging in greenhouse gas activities, or a pipeline licence in relation to a greenhouse gas pipeline.

1.3. A registered holder, in relation to a title, means the person(s) whose name is shown in the Register kept under sections 469 (petroleum titles) and 521 (greenhouse gas titles) of the OPGGSA as the holder(s) of the title.

2. NOMINATION OF TITLEHOLDER – SERVICE OF DOCUMENTS

Petroleum Titles

2.1. Where there are two or more registered holders of a petroleum title, subsection 774(2) of the OPGGSA states that those registered holders may, by joint written notice given to NOPTA and NOPSEMA, nominate one of them to be the person upon whom documents may be served, where those documents relate to the petroleum title and are required or permitted by the OPGGSA to be given to the titleholder.

2.2. The joint written notice must be executed in an approved manner by or on behalf of each of the registered holders, and must be in the form approved, in writing, by NOPTA and NOPSEMA (available on the NOPTA or NOPSEMA website).

2.3. Under these arrangements, where the document has been served on the nominated person, the document is deemed to have been served on all of the registered holders of the title (see subsection 774(4) of the OPGGSA).

2.4. The nomination of a single titleholder in a group of multiple titleholders for the service of documents is not compulsory; however it is encouraged in the interests of efficiency.

Greenhouse Gas Titles

2.5. This Guideline will only have relevance to greenhouse gas titles once there is a greenhouse gas title with multiple titleholders.

2.6. Where there are two or more registered holders of a greenhouse gas title, subsection 775(2) of the OPGGSA states that those registered holders may, by joint written notice given to the responsible Commonwealth Minister, nominate one of them to be the person upon whom documents may be served, where those documents relate to the greenhouse gas title and are required or permitted by the OPGGSA to be given to the titleholder.

2.7. The joint written notice must be given to the responsible Commonwealth Minister by posting it as a letter addressed to the Department of Resources, Energy and Tourism, or by personal delivery to the Department, and must be executed in an approved manner by or on behalf of each of the registered holders.

2.8. Under these arrangements, where the document has been served on the nominated person, the document is deemed to have been served on all of the registered holders of the title (see subsection 775(4) of the OPGGSA).

2.9. The nomination of a single titleholder in a group of multiple titleholders for the service of documents is not compulsory; however it is encouraged in the interests of efficiency.

3. NOMINATION OF TITLEHOLDER—‘ELIGIBLE VOLUNTARY ACTIONS’ (RECEIPT OF DOCUMENTS)

3.1. These provisions relating to the taking of an ‘eligible voluntary action’ are of critical importance to multiple titleholders. While sections 775B and 775C are expressed in permissive, not mandatory, terms, the sections provide the ONLY means by which a titleholder group can take the actions to which the sections apply.

3.2. Section 775A states that the concept of an ‘eligible voluntary action’ applies to making an application, giving a nomination, making a request or giving a notice to the Joint Authority, NOPTA, or the responsible Commonwealth Minister under the OPGGSA.

3.3. A small number of exceptions to the concept are listed under subsection 775A(2) – these are technical exclusions made for drafting purposes (to prevent the provisions becoming circular in operation).

3.4. Sections 775B (petroleum titles) and 775C (greenhouse gas titles) provide for the registered holders of a title to jointly nominate one of them as being the person who is authorised to take eligible voluntary actions on behalf of the group of registered titleholders.

3.5. It is critical to note that the legal effect of subsections 775B(5) and 775C(5) respectively is to require nomination of a single titleholder in order to undertake eligible voluntary actions under the OPGGSA.

3.6. In other words, where there are two or more titleholders registered for a single title, there must be a nomination of one of the titleholders, and that nominated titleholder must take the voluntary action, in order to validly make an application, give a nomination, make a request or give a notice to the Joint Authority, NOPTA or the responsible Commonwealth Minister (as applicable) under the OPGGSA.

3.7. The nomination is made by joint written notice given to NOPTA (petroleum titles) or the responsible Commonwealth Minister (greenhouse gas titles). The notice must be executed in an approved manner by or on behalf of each of the registered holders. For the approved form in relation to a nomination of a petroleum titleholder under section 775B, please see the NOPTA website.

MULTIPLE TITLEHOLDERS: SERVICE OF DOCUMENTS, TAKING VOLUNTARY ACTIONS AND DISCHARGING OBLIGATIONS 1

4. REVOCATION & CESSATION OF NOMINATIONS

Service of documents—petroleum titles

4.1. Where a person has been nominated under subsection 774(2) of the OPGGSA in relation to the service of documents, and any one of the registered holders of the petroleum title revokes the nomination by written notice given to NOPTA and NOPSEMA, then the nomination ceases to be in force (subsection 774(5)).

4.2. The notice must be in the form approved, in writing, by NOPTA and NOPSEMA (available on the NOPTA or NOPSEMA website).

4.3. Similarly, where the nominated person ceases to be one of the registered holders of the petroleum title, the nomination also ceases to be in force (subsection 774(6)).

Eligible voluntary actions

4.4. Where a petroleum or greenhouse gas titleholder has been nominated under subsections 775B(2) or 775C(2) respectively of the OPGGSA in relation to the undertaking of eligible voluntary actions, and any one of the registered holders of the title revokes the nomination by written notice given to NOPTA (petroleum titles) or the responsible Commonwealth Minister (greenhouse gas titles), then the nomination ceases to be in force.

4.5. Similarly, where the nominated person ceases to be one of the registered holders of the petroleum or greenhouse gas title, the nomination also ceases to be in force (subsections 775B(7) and 775C(7)).

TABLE OF REVISIONS

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5. MULTIPLE TITLEHOLDERS: DISCHARGE OF LEGAL OBLIGATIONS

5.1. Sections 775D (petroleum titles) and 775E (greenhouse gas titles) provide that where the OPGGSA imposes an obligation on a titleholder and there are multiple titleholders in relation to a single title, the obligation is imposed on each of them; however the obligation may be discharged by any one of them.

5.2. In other words, where there are multiple titleholders, they are jointly and severally liable in relation to their title-related legal obligations under the OPGGSA, but once one of the titleholders has discharged the legal obligation, the remaining titleholders are discharged from that duty.

TABLE OF REVISIONS

MULTIPLE TITLEHOLDERS: SERVICE OF DOCUMENTS, TAKING VOLUNTARY ACTIONS AND DISCHARGING OBLIGATIONS 1