❓ Hon Robin Chapple questions the Minister for Mines and Petroleum regarding conflicting information about the estimated cost to rehabilitate the Nicolay-1 well site and other New Standard Energy sites in the Great Sandy Desert. The question highlights discrepancies between a DMIRS briefing note and a previous answer to a question on notice.
AnsweredQoN 1231Legislative Council
QuestionView source ↗
NEW STANDARD ENERGY —
GREAT SANDY DESERT
1231. Hon ROBIN CHAPPLE to the minister representing the
Minister for Mines and Petroleum:
I refer to question on notice 1922,
asked on 12 March 2019, and to the briefing note from the Department of Mines,
Industry Regulation and Safety received by the minister's office on 12
February 2019 regarding the estimate of the cost to rehabilitate the Nicolay-1
well site.
(1) Can the
minister confirm that this briefing note contained the sentence —
DMIRS estimates
the cost to P&A the well and rehabilitate the site to be $1.5 million.
(2) Is the
minister aware that the answer to part (m) of question on notice 1922 was —
The Department of Mines, Industry
Regulation and Safety � does not have an estimate of the likely cost of the
work �
(3) Is the minister
confident in the department's figure of $1.5 million, and can this be
applied to other wells aside from Nicolay-1?
(4) Could the
minister suggest why the figure referenced at (1) was not known to either the
minister or the department a month after receiving this briefing?
(5) Given that six other New Standard Energy sites,
some with wells, have also not been closed and rehabilitated as
required, will the state seek remuneration from the proponents that established
these sites?
GREAT SANDY DESERT
1231. Hon ROBIN CHAPPLE to the minister representing the
Minister for Mines and Petroleum:
I refer to question on notice 1922,
asked on 12 March 2019, and to the briefing note from the Department of Mines,
Industry Regulation and Safety received by the minister's office on 12
February 2019 regarding the estimate of the cost to rehabilitate the Nicolay-1
well site.
(1) Can the
minister confirm that this briefing note contained the sentence —
DMIRS estimates
the cost to P&A the well and rehabilitate the site to be $1.5 million.
(2) Is the
minister aware that the answer to part (m) of question on notice 1922 was —
The Department of Mines, Industry
Regulation and Safety � does not have an estimate of the likely cost of the
work �
(3) Is the minister
confident in the department's figure of $1.5 million, and can this be
applied to other wells aside from Nicolay-1?
(4) Could the
minister suggest why the figure referenced at (1) was not known to either the
minister or the department a month after receiving this briefing?
(5) Given that six other New Standard Energy sites,
some with wells, have also not been closed and rehabilitated as
required, will the state seek remuneration from the proponents that established
these sites?
AnswerView source ↗
I thank the member for the
question. The Minister for Mines and Petroleum has provided the following
answer.
(1) Yes.
(2) The full
answer given was, and I quote —
The
Department of Mines, Industry Regulation and Safety (DMIRS) does not have an
estimate of the likely cost of the work as there is no requirement for the
company to provide these costs under the Petroleum and Geothermal Energy
Resources Act 1967 . It is the company's responsibility to undertake
these works at its own cost.
(3) As set out in
my answer to question on notice 1922, the company is obligated to undertake
these works at its own cost and is not required to provide this to DMIRS. Cost
analysis is specific to each well, based on various factors including well
status and its condition, location and the rehabilitation work required on
site.
(4) A full cost
analysis has not been undertaken by DMIRS. I am advised by DMIRS that the
figure provided in the briefing note was determined based on knowledge and
available data at the time.
(5) New Standard
Energy is required to rehabilitate its sites in accordance with the directions
issued to date. The department is continuing to investigate other wells where
directions have not been issued to date.
question. The Minister for Mines and Petroleum has provided the following
answer.
(1) Yes.
(2) The full
answer given was, and I quote —
The
Department of Mines, Industry Regulation and Safety (DMIRS) does not have an
estimate of the likely cost of the work as there is no requirement for the
company to provide these costs under the Petroleum and Geothermal Energy
Resources Act 1967 . It is the company's responsibility to undertake
these works at its own cost.
(3) As set out in
my answer to question on notice 1922, the company is obligated to undertake
these works at its own cost and is not required to provide this to DMIRS. Cost
analysis is specific to each well, based on various factors including well
status and its condition, location and the rehabilitation work required on
site.
(4) A full cost
analysis has not been undertaken by DMIRS. I am advised by DMIRS that the
figure provided in the briefing note was determined based on knowledge and
available data at the time.
(5) New Standard
Energy is required to rehabilitate its sites in accordance with the directions
issued to date. The department is continuing to investigate other wells where
directions have not been issued to date.
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