Coal seam gas conduct and compensation agreements

06 February 2014 Topics: Agribusiness

Resource companies are required to negotiate compensation with landholders prior to undertaking significant activities on their land. Usually, the compensation is detailed in an agreement called a ‘conduct and compensation agreement’ (CCA). CCAs set out not only the compensation landholders receive but also the way in which the resource company will conduct its activities on the land, particularly how those activities will be done so as to minimise any interference with farming or grazing activities.

As a landholder, you are entitled to receive compensation for:

  • deprivation of possession of land surface;
  • reduction in land value;
  • reduction in land use including reduced use that could be made through any improvements to it;
  • severance of any land from other parts of the land owned by the landholders;
  • any cost, damage or loss arising from activities carried out under the land surface;
  • your accounting, legal or valuation costs reasonably incurred to negotiate conduct and compensation agreement (excluding for costs involved to resolve disputes via independent alternative dispute resolution); and
  • any damages incurred by the landholder as a consequence of the above.

A resource company is only authorised to come onto your land if:

  • it has given you an entry notice of at least 10 business days in relation to preliminary activities (preliminary activities are those that will have either no impact on your land or only a minor impact on your land or your business activities); and
  • for advanced activities (activities that are likely to have a significant impact on your land and business activities), the resource company has either:

–    entered into a CCA with you;

–    entered into a deferral agreement with you (where you will agree the terms of a CCA at a later date); or

–    applied to the Land Court for a decision in relation to your compensation.

Your arrangements with a resource company can affect your land, and your business for many, many years, so it is extremely important to obtain strong legal advice prior to entering into a CCA.

Cooper Grace Ward has hands-on experience in negotiating CCAs and consultant David Grace has the unique experience of not only negotiating CCAs, but also experience in operating under them. We take a business to business approach and consider all aspects of how your business will be affected, and therefore what you are entitled to be compensated for.

In addition to negotiating the terms of your CCA, Cooper Grace Ward can also assist you with:

  • identifying how the activities may affect you, and therefore the basis of compensation to be paid to you;
  • instructing valuers and accountants;
  • tax advice in relation to your CCA;
  • negotiating documents, including easements;
  • advice in relation to breaches of your CCA by the resource company; and
  • applications to the Land Court.

For more information on your rights, or to get legal advice about a CCA, please contact David Grace on 07 3231 2421.

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This publication is for information only and is not legal advice. You should obtain advice that is specific to your circumstances and not rely on this publication as legal advice. If there are any issues you would like us to advise you on arising from this publication, please let us know.