Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) This section applies in relation to a petroleum activity carried out in relation to any of the following titles:
(a) a petroleum exploration permit;
(b) a petroleum retention lease;
(c) a petroleum production licence;
(d) an infrastructure licence;
(e) a pipeline licence;
(f) a petroleum special prospecting authority;
(g) a petroleum access authority.
Titleholder duty to maintain financial assurance
(2) The titleholder must, at all times while the title is in force, maintain financial assurance sufficient to give the titleholder the capacity to meet costs, expenses and liabilities arising in connection with, or as a result of:
(a) the carrying out of the petroleum activity; or
(b) the doing of any other thing for the purposes of the petroleum activity; or
(c) complying (or failing to comply) with a requirement under this Act, or a legislative instrument under this Act, in relation to the petroleum activity.
Examples: This subsection covers costs, expenses and liabilities arising in connection with, or as a result of, the following (without limitation):
(a) complying with the titleholder's duty under section 572C (which relates to the escape of petroleum);
(b) a debt due to the Commonwealth, NOPSEMA, a State or the Northern Territory under section 572D, 572E or 572F (which relate to an escape of petroleum), including a debt due to an agency or authority on behalf of the State or the Northern Territory;
(c) complying with a direction under section 574 or 586 relating to the remediation of damage to the seabed or subsoil arising in connection with a petroleum activity.
(3) The following may be provided for by regulation:
(a) compliance with subsection (2) in relation to a petroleum activity to be demonstrated as a prior condition of acceptance of an environment plan for the activity;
(b) such compliance to be in a form acceptable to NOPSEMA;
(c) a failure to maintain such compliance, in a form acceptable to NOPSEMA, to be grounds for the withdrawal of acceptance of an environment plan for the activity.
(4) The forms of financial assurance for a title that may be maintained for the purposes of this section include (without limitation) any of the following, or any combination of the following:
(d) the deposit of an amount as security with a financial institution;
(e) an indemnity or other surety;
(f) a letter of credit from a financial institution;
"environment plan" for a petroleum activity means an environment plan for the activity under prescribed regulations, or a prescribed provision of regulations, made under this Act.
"financial institution" has its ordinary meaning, and (to avoid doubt) includes:
(a) an authorised deposit - taking institution within the meaning of the Banking Act 1959 ; and
(b) a financial institution of a foreign country.
"petroleum activity" has the meaning given by prescribed regulations, or a prescribed provision of regulations, made under this Act.
"self-insurance" : for a petroleum activity in relation to a title, the titleholder maintains financial assurance in the form of self-insurance to the extent that the titleholder ensures that financial resources are available at all times while the title is in force to meet costs, expenses and liabilities in relation to the activity arising as mentioned in subsection (2).
"titleholder" , for a title in relation to which this section applies, means
the registered holder of the title.