Proposal for a new Norwegian Minerals Act
The Minerals Act Committee (chaired by Ernst Nordtveit) has presented a comprehensive Official Norwegian Report (NOU) with proposals for a new Minerals Act. We believe that the industry will wish to provide important input to the proposal. Below are the main points of the proposal.
The main proposals in NOU 2022: 8 can be briefly summarized as follows:
The distinction between minerals owned by the State and minerals owned by a landowner is maintained, but steps are taken to harmonize the rules
- The Committee proposes to maintain the distinction between minerals owned by the State and minerals owned by a landowner.
- Furthermore, measures are proposed to harmonize the rules by establishing a joint exploration permit for minerals owned by the State and for industrial minerals and light minerals.
- The Committee proposes that the Norwegian Directorate of Mining (DMF) shall grant exploration permits for these types of minerals.
- A majority of the Committee proposes that an agreement is required with the landowner before DMF can grant an exploration permit. A minority proposes that DMF shall be able to grant such an exploration permit without landowner consent.
- The exploration permit is proposed to give extraction rights to minerals owned by the State if the requirement for commercial viability is fulfilled, while the exploration permit for industrial minerals and light metals also requires that an agreement is entered into with the landowner(s).
- New rules are also proposed regarding the relationship between minerals owned by the State and minerals owned by a landowner in those instances where these are located in the same area or are physically or chemically connected. The new proposal means that the current rules are changed from the landowner being responsible for the extraction if the mineral deposit owned by a landowner is obviously commercially viable alone, to it being sufficient that it is probable that the deposit can be extracted separately.
- The Committee also proposes to move away from having separate chapters for each of the two mineral categories and wants to harmonize the regulations.
Searching and explorations
- Exploration permits are proposed granted for three years, but so that these can be extended by three years at a time up to a maximum of 15 years. A prerequisite is that the exploring party has fulfilled its duties and carried out explorations in accordance with the exploration plan.
- The Committee proposes that the landowner and the municipality are involved to a greater extent before an exploration permit is granted. It is proposed that DMF must balance the granting of an exploration permit against considerations for the natural environment, landowner use and other use of the area and the relationship to the surroundings – or other reasons that indicate that an exploration permit should not be granted. This represents a significant change in the prevailing law.
- There is no statutory limit on the quantities that can be extracted, but it is limited to the quantity required for the purpose. In addition, this must be approved by DMF, and a pilot extraction plan must also be prepared.
- The Committee mainly proposes to continue the rules on searching, but proposes a change in that surveying performed from the air shall be more clearly defined as searching.
- The Committee proposes to introduce a requirement that the applicant shall prepare an exploration plan describing the work to be carried out in the exploration area.
Extraction and completion of extraction of mineral deposits
- The Committee proposes to clarify the rules on requirements for an operating license and require a revision of the operating license and the operating plan.
- Rules are proposed to clarify and limit the operating party's duty to implement safety measures for work carried out earlier by other parties.
- The Committee proposes rules for completion control when operations are completed.
- The Committee does not propose that the Act shall apply in general to extraction of mineral deposits where the deposits are extracted for other uses, such as infrastructure projects or other development. Nevertheless, it is proposed that the rules on sound mineral activities and competence requirements shall also apply to such extraction of mineral deposits, and that the Ministry is authorized to stipulate in regulations requirements for operating licenses for such extractions, as well as reporting obligations.
The relationship to Sámi rights
- The Committee proposes to move away from the rules that apply specifically to Finnmark County. Explorations, pilot extractions and extractions taking place in traditional Sámi areas, and which will lead to significant encroachment on Sámi rights of use, will either require an agreement with the rights holders or compulsory acquisition of the necessary rights.
- Compensation has been proposed for losses due to restrictions on use as a result of mineral activities in accordance with general rules for compensation for compulsory acquisition.
- A separate provision has been proposed to regulate that in connection with permits for mineral activities in traditional Sámi areas, emphasis shall be placed on the effect the decision will have on the natural basis for Sámi cultural practice. This should also be seen in connection with other implemented or planned measures in the area.
- Proposals have also been included as to when consultation is required in accordance with the Sámi Act, Chapter 4, and how the consultation shall be carried out.
- Considering the Fosen judgment (HR-2021-1975-S), it has been proposed that permits cannot be granted for measures or operation that will have "significant negative effects" on the natural basis for Sámi cultural practice. However, an exclusionary provision has been proposed that an agreement on such measures may be entered into between the operating party and the affected Siidas, with the consent of the Sámi Parliament.
- New provisions for compensation payment have been proposed, according to which compensation shall be paid for all mineral extraction in traditional Sámi areas. The compensation payment is proposed to be divided between the Sámi Parliament and the Siidas affected by the measures – with 25 per cent to the Sámi Parliament and 75 per cent to the Siidas.
- The rate of 0.25% for compensation payment to indigenous people for the extraction of minerals owned by the State is continued. In addition, compensation payment to indigenous people has been proposed for the extraction of minerals owned by a landowner, where the compensation payment is determined based on the compensation payment to the landowners.
Coordination of regulations and procedures
- The Committee proposes rules for coordination of procedures for the granting of extraction permits and other public law permits that are necessary in this regard.
- DMF is also intended to have a central role in organizing meetings with affected private and public parties.
- A special rule is proposed that an operating party applying for extraction permits concerning minerals owned by the State, industrial minerals and light metals, may demand that the application shall be coordinated with an application for a discharge permit pursuant to Section 11 of the Pollution Control Act.
- Coordination of the procedures for the granting of extraction permits is also proposed so that DMF can grant exemption from plans under the Planning and Building Act and permits under the Motor Traffic Act at the same time as they decide on exploration permits for minerals owned by the State, industrial minerals and light metals. DMF shall, however, obtain a statement from the municipality to do this.
- It has been proposed that a decision on an operating permit cannot be made until the area has been clarified in accordance with the Planning and Building Act. However, it is intended that the procedures can take place in parallel.
- A general requirement is proposed for mineral activities to take place in a sound manner and in a way that safeguards the safety of personnel, the environment and the surroundings. This shall be assessed based on what is technologically and economically possible at any given time.
- To simplify the financing of mineral activities, rules are proposed for pledging and transferring permits.
- The Committee proposes that the operating party shall notify the surroundings at start-up, changes or measures that may affect the surroundings, and that a dialogue shall be arranged with, especially, neighbours and rights holders in the area.
- New reporting obligations are proposed for results from surveying of the terrain and from exploration for minerals owned by the State, industrial minerals and light metals.
- The Committee also proposes rules for the duty of confidentiality regarding information and data received in accordance with the reporting rules. This is to protect trade secrets.
- It is also proposed that extraction mainly taking place as part of facilitating other uses of the terrain than the utilization of mineral resources, shall be reported to DMF if the extraction exceeds 5,000 m3.
- The Committee proposes to change the term "exploration right" to "exploration permit".
- The term "operating license" is proposed to be changed to "operating permit".
- Significant interventions in the terrain will require the consent of the landowner or compulsory acquisition of rights.
- It is also proposed that the Act shall include exploration of remaining deposits from earlier mineral activities as well as extractions from these.
Advokatfirmaet Schjødt regularly assists players in the mineral industry with various challenges of a legal nature, whether related to framework conditions, applications for public law permits and private law agreements. Based on the draft law, we are of the opinion that the minerals industry will benefit from submitting consultation statements in which they express their views relating to the proposal, as it means significant changes in relation to the current regime. The consultation deadline is 1 November 2022. In connection with the presentation of the draft law, the Minister of Trade and Industry called for consultation responses to be submitted as soon as possible, so that the government has plenty of time to work on this and to include input in the government's work on a new mineral strategy to be presented before Christmas this year. Please contact us if your company wants further information about the content of the draft law or there are questions about this you wish to discuss. Of course, we can also assist in preparing the consultation statement.
Note: Please note that all information reproduced in this newsletter is taken from NOU 2022: 8.