About the financial provisioning scheme
The Mineral and Energy Resources (Financial Provisioning) Act 2018 (the Act) came into force on 1 April 2019. The Act replaced the prior financial assurance arrangements for resource activities under the Environmental Protection Act 1994 (EP Act) with the Financial Provisioning Scheme (the Scheme).
The Scheme is administered by the Scheme Manager, a statutory officer supported by Queensland Treasury. Mr Timothy Michael was appointed as the Scheme Manager on 29 June 2023 by the Governor in Council.
The purpose of the Scheme is to improve the State’s management of its financial risk in the event holders of a resource activity environmental authority (holders) or small scale mining tenure (SSMT) fail to comply with their environmental management and rehabilitation obligations. Over time, the scheme will also provide funds to support rehabilitation of abandoned mines and expand research into mine rehabilitation.
The Scheme Manager is responsible for administering all SSMT and holders’ financial provisioning on behalf of the State of Queensland.
The Scheme Manager will require:
- SSMTs and holders of environmental authorities with an estimated rehabilitation cost below $100,000 to provide surety equal to the estimated rehabilitation cost for that authority.
- environmental authorities with at least $100,000 in estimated rehabilitation costs will undergo an annual risk category allocation assessment process. The assessment process will determine whether the holder will be required to provide a contribution to the Scheme’s Financial Provisioning Fund and/or to provide surety to the Scheme Manager for that authority.
Who does the Act apply to?
All resource activity holders of an environmental authority.
All holders of a small scale mining tenure permit.
Who is not affected by the Act?
A holder of an Environmental Authority for a prescribed environmentally relevant activity (e.g. non-resource sites such as landfills, agriculture) provide financial assurance as required by the EP Act.
Regulation, Scheme guidelines and information
The Mineral and Energy Resources (Financial Provisioning) Regulation 2019 establishes the prescribed insurer, formula for determining the contribution to be paid to the Scheme’s fund and sets the assessment fees.
To assist holder’s implementation of their obligations under the Act, the Scheme Manager has published the following guidelines, information sheets, templates and surety checklist.
- Forming the Scheme Manager’s Opinion
- Risk Category Allocation (Information Sheet 1)
- Assigning an Authority to a Relevant Holder
- Requiring Surety to Preserve the Financial Viability of the Scheme Fund
- Forms of Surety
- Financial Institution Undertaking (non-cash surety template)
- Cash Surety Deed template
- Surety checklist
- Realising surety provided by multiple holders, (Information sheet 2)
- Financial institution paying out a surety instrument (Information sheet 3)
- Environmental authority transfer processes (Information sheet 4)
Mandated notification forms
The Act requires holders to notify the Scheme Manager in certain circumstances. The circumstances and relevant notification form to use are below.
- Form FPS1 – this form is to be completed by a holder that has been allocated to a risk category to apply under s33 of the MERFP Act to the scheme manager for a proposed changed holder review allocation.
- Form FPS2 – this form is to be completed by a holder, that has been allocated to a risk category, to give notice to the scheme manager under s42 of the MERFP Act that there has been a direct/indirect change of holder for an authority.
- Form FPS3 – this form is to be completed by a holder to give notice to the scheme manager under s43 of the MERFP Act that production in relation to an authority has ceased.
Advisory committee
The Financial Provisioning Scheme Advisory Committee provides advice to the Queensland Government about funding requests from the Scheme fund for:
- remediation/rehabilitation activities at land on which an abandoned mine exists; and
- research that may contribute to the rehabilitation of land on which resources activities have been carried out.
The committee is Chaired by Ms Helen Dogan, Assistant Under Treasurer, Queensland Treasury.
Committee members are:
- Dr Carl Grant
- Mr Richie Ah Mat
- Dr Julie Beeby
- Dr Emma Gagen
- Mr Michael McCabe
- Mr Joshua O’Rourke
- Ms Julia Taylor
- Mr Stephen Smyth
- Mr Matthew Paull
Scheme process for consultation
The Scheme Manager will release documents for consultation from time to time in this section. Once the consultation period has closed, the documents will be removed from the web page until provided as an approved process.
Now that the transition period under the Act is complete, the Scheme Manager has engaged the external Risk Advisory Consortium, led by KPMG, to undertake a review of the Financial Provisioning Scheme under the terms of their existing engagement. The Post Transition Review discussion paper below consultation period has closed. Following the consultation process, the Acting Scheme Manager has released the below Summary Report with Acting Scheme Manager recommendations.
Annual Report
On a yearly basis, the Scheme Manager prepares an annual report which forms part of the Scheme’s corporate governance framework, and fulfils the Scheme Manager’s obligation under section 83B of the Mineral and Energy Resources (Financial Provisioning) Act 2018. The reports are prepared in accordance with the Financial Provisioning Scheme Annual Report Framework.
The annual reports are available at https://www.treasury.qld.gov.au/resource/financial-provisioning-scheme-annual-report.
Contact
For scheme matters, please email fps@treasury.qld.gov.au or phone the Financial Provisioning Scheme on 07 3035 3551.
For information about the whole of government financial assurance reform project please visit https://www.treasury.qld.gov.au/growing-queensland/improving-rehabilitation-financial-assurance-outcomes-resources-sector.
For further information about mining rehabilitation reforms please visit Department of Environment and Science – Mining rehabilitation reforms.
Contact DES for all enquiries about your Authority, including any questions about the ERC for the Authority contact details are available on the following webpage Contact details for Permit and Licence Management.
For any Resources matters including but not limited to small scale mining the departments contact details are available on the following website Department of Resources – Contact us.