Financial assurance, provisioning and rehabilitation for environmental authorities
Financial assurance is a security deposit held by the administering authority to ensure the holder of an environmental authority (EA) complies with the conditions of the EA and to cover potential rehabilitation costs.
There are 2 types of financial assurance:
- scheme assurance for resource activities
- Environmental Protection Act 1994 (EPA) assurance for prescribed environmentally relevant activities (ERAs).
The Mineral and Energy Resources (Financial Provisioning) Act 2018 (MERFP Act) came into force on 1 April 2019 and establishes the Financial Provisioning Scheme (FPS) administered by the Scheme Manager. The FPS will hold all scheme assurance provided by the resource sector under the Environmental Protection Act 1994.
If you hold an EA for a resource activity or small scale mining tenure you are required to provide scheme assurance to the FPS.
All resource activity EAs and small scale mining tenures with existing financial assurance will be transferred to the FPS.
The holder of an EA for a prescribed environmentally relevant activity (ERA) is required to provide EPA assurance to the administering authority.
Financial assurance or scheme assurance is held while your operation is underway and must be provided to the administering authority or the Scheme Manager before you begin operating.
You must pay financial assurance to cover the likely costs and expenses to:
- prevent or minimise environmental harm or rehabilitate or restore the environment
- secure compliance with an EA or prescribed condition for a small scale mining activity.
From 1 November 2019 (known as the PRCP start date) there is a requirement for a Progressive Rehabilitation and Closure Plan (PRC plan) for all site-specific EAs relating to mining activities.
If you have an EA for a resource activity, progressive rehabilitation is a way for you to reduce the amount of scheme assurance required by rehabilitating disturbed areas while you conduct a resource project. It allows you to:
- apply for progressive certification of rehabilitated areas of your tenure
- surrender part of your resource tenure over time to reduce this amount.
This guide includes information on how to:
- calculate and pay financial assurance
- apply for a PRCP schedule
- apply for progressive rehabilitation and certification.