STILL WATERS RUN DEEP Pilbara Iron Ore State Agreement Rights to Mine Dewatering and Water Law Reform Natalie Brown LLB UWA Hons 2011 This thesis is presented for the degree of Doctor of Philosophy of The University of Western Australia School of Law [2018] THESIS DECLARATION I, Natalie Brown, certify that: This thesis has been substantially accomplished during enrolment in the degree. This thesis does not contain material which has been submitted for the award of any other degree or diploma in my name, in any university or other tertiary institution. No part of this work will, in the future, be used in a submission in my name, for any other degree or diploma in any university or other tertiary institution without the prior approval of The University of Western Australia and where applicable, any partner institution responsible for the joint-award of this degree. This thesis does not contain any material previously published or written by another person, except where due reference has been made in the text and, where relevant, in the Declaration that follows. The work(s) are not in any way a violation or infringement of any copyright, trademark, patent, or other rights whatsoever of any person. This thesis contains published work, which has been co-authored. This research was supported by: the National Centre for Groundwater Research and Training as part of the Centre’s Programme 5, of which Professor Alex Gardner is a chief investigator (ad-hoc Scholarship); the University of Western Australia (UWA) Centre for Mining, Energy and Natural Resources Law (ad-hoc Scholarship); the Australian Post Graduate Award and Safety-net Top-up Commonwealth Scholarships; an Australian Government Research Training Program (RTP) Scholarship; and the UWA Graduate Research School and Law School funding for research purposes. Signature: Date: 31 May 2018 ABSTRACT Vast amounts of mine dewatering in the Pilbara iron ore mining industry are arguably not legally authorised pursuant to the State Agreements’ framework that governs most mines in the region. An appreciation of that hiatus in legal authority is the basis for a new evaluation of how Western Australian water resources law reform may implement the Intergovernmental Agreement on a National Water Initiative (NWI). This new evaluation will provide the basis for regulating mine dewatering in this very important region, which supplies 38% of global iron ore production and depends on groundwater for the future of its very high environmental and social values. In the Pilbara, the practice of mine dewatering—that is, the abstraction and disposal of groundwater to allow safe mining below the water table—is a relatively new environmental risk. Pilbara mine dewatering increased rapidly during the 2003 – 2013 commodities boom and is projected to rise further. The State government, the iron ore industry and other stakeholders recognise that mine dewatering presents significant current and long-term environmental management issues, particularly in areas of intense mining where the impacts accumulate. Regulating that mine dewatering requires a statutory water plan appropriate for the Pilbara’s aquifer system, iron ore industry, and environmental, social and cultural values (Pilbara water plan). However, there are political and legal obstacles to delivering a Pilbara water plan. General legal understanding sees a significant obstacle to introducing a Pilbara water plan in the government’s regulation of 93 percent of the industry through the Pilbara iron ore State agreements (PSAs). PSAs’ are contracts ratified by an Act of Parliament that can modify the general State laws regulating mining, water, and the environment. A bipartisan government policy holds the PSA rights as inviolable—the government only amends PSA rights by negotiating the changes with the PSA proponents (sovereign risk policy). Two key questions inform discussion of the effect of the sovereign risk policy on water resources law reform. First, are the mines authorised by PSAs subject to the Environmental Protection Act 1986 (WA) (EP Act)? Secondly, which PSAs confer mine dewatering rights and what are those rights? Answering the first question informs the evaluation of the EP Act’s capacity to deliver a Pilbara water plan. Examining the PSAs’ mine dewatering rights informs the evaluation of a Pilbara water plan that new legislation could deliver without abrogating the PSA rights or disturbing the sovereign risk policy (new Pilbara water plan). The conclusion drawn, first, is that the EP Act could deliver a Pilbara water plan regulating mine dewater, subject to a few limitations. Secondly, new legislation could deliver a new Pilbara water plan with the capacity to regulate a majority of mine dewatering because the PSA groundwater rights may be more limited than generally perceived. The PSAs generally confer groundwater extraction rights for the purposes of supplying water for operations but not for excess dewatering that requires disposal, so regulating excess mine dewater would not be violating PSA rights. However, the economic importance of iron ore revenue may constrain the political will to introduce a Pilbara water plan with the capacity to regulate mine dewatering via either the EP Act or new legislation. Mine dewatering and iron ore extraction are co-dependent activities, so regulating the former could limit the latter. This constraint may be met by proposing reforms that do not limit mine dewatering and, undertaking further research to progress to robust water law reform over time. ACKNOWLEDGEMENTS This thesis was written on the homeland of the Whadjuk Noongar people. As such, I would like to begin by acknowledging the Whadjuk Noongar people; their continuing stewardship of their lands; and their Elders past present and future. I also acknowledge the many other Traditional Owners of Western Australia whose homelands are affected by the legislative and policy frameworks that are subjects of this thesis. This research was supported by: the National Centre for Groundwater Research and Training as part of the Centre’s Programme 5, of which Professor Alex Gardner is a chief investigator (ad-hoc Scholarship); the University of Western Australia (UWA) Centre for Mining, Energy and Natural Resources Law (ad-hoc Scholarship); the Australian Post Graduate Award and Safety-net Top-up Commonwealth Scholarships; an Australian Government Research Training Program (RTP) Scholarship; and the UWA Graduate Research School and Law School funding for research purposes. Frontispiece: This photo is of the mine dewater gabion feed to the Weeli Wolli Spring. Since the taking of the photo the gabion has been covered by a structure and signage explaining the significance of the site to the Traditional Owners. The Pilbara resident who contributed the photo to this work has asked to remain anonymous. The symbol at the bottom right hand corner of the photo is the National Water Council’s symbol of reconciliation, ‘United Hands’ created by Mark Beanland, National Water Commission, A Review of Indigenous Involvement in Water Planning, 2013 (National Water Commission, 2014) 1. This image is reproduced without alteration, Creative Commons by Attribution 3.0 (Australia). The figures, maps and photographs used in this thesis are either the work of the author based on data, created for the author, subject to a creative commons licence, or the author has received permission to use the work from the creator or owner. In this respect, I would like to thank Christine Hearne for creating the map titled ‘1960s Pilbara Iron Ore Mines’ for this thesis, the Chamber of Minerals and Energy (WA), Minerals Council of Australia, the Australian National University, the Commonwealth Scientific and Industrial Research Organisation, and the State and Commonwealth government departments who have kindly granted permission for the use of their materials. Many people, in many ways, support extensive work. I would like to thank and acknowledge the following people. My principal supervisor, Alex Gardner, for entrusting me with this challenging and rewarding research project. His extraordinary breadth of knowledge, lateral approach to legal argument and meticulous attention to detail, provided depth and precision to this thesis argument; My second supervisor, Simon Young, for his insightful and valuable suggestions always delivered with positive support. His enthusiasm for legal research motivated me in the tough times, and his dynamic writing style and succinct turn of phrase gave me the confidence to find my expression; My third supervisor, John Tarrant, for providing guidance on how to deal with the PhD process, always providing feedback promptly, seeing the big picture and having faith in the final product; John Chandler for providing his fundamental knowledge and understanding of this difficult niche of law, State agreements, and for convincing me that the regime’s operation really does depend on the State agreement terms; Ryan Vogel for providing a crash course in hydrogeology and responding patiently to my many questions; Michael Bennett for sending me some important pieces and sharing the PhD journey; and John Southalan for always inviting me to his State agreement seminars and being as interested in them as I am; Richard Bartlett for allowing me to learn the basics of mining law in his tutorials and lectures and Richard Hooker for discussing with me the finer points subsidiary regulation; The UWA Graduate Research School staff for their support, kindness, and administrative assistance,