property rights australia conference and agm friday, 13 june 2014
TRANSCRIPT
PROPERTY RIGHTS AUSTRALIACONFERENCE AND AGM
Friday, 13 June 2014
‘Negotiation Tool Kit’
Ann SomersEmanate Legal
Roma
Introduction
The purpose of this session is to:
• Identify best practice for entering into a Conduct and Compensation Agreement (CCA) that works for you and your business
The key messages are:
• Planning• Communication• Review
What do Gas/Mining CompaniesWant and Why?
What the Company wants:
• Landowners to sign the CCA quickly• Using the company CCA• With as few changes as possible• Keeping conditions and definitions in the CCA, broad• Hopefully without landholder lawyers’ involvement
Why:
• To meet project timeline and within budget• Ensure all drill rigs/crews are never left on standby
Flaws in this System
• Does not acknowledge that the CCA is the start of the process not the finish
• Limits the time for proper planning on both sides (i.e. leaves CCA open to drafting issues)
• Substantially increases the opportunity for legacy issues to become the ‘norm’ rather than the ‘exception’
• Does not acknowledge the long term relationship between the landowner and the company
• Encourages bad behaviour
• Risk of break down in communications
The Nature of the Beast
• Companies are multi-national
• Companies have Land Liaison Officers on the ground who report back to Head Office
• Head Office has the main sign-off
Mega Project
• Mega projects are high budget - ten billion plus ($10B)
• Technically complex
• First time for Australia
• Multiple investors and contractors
• Tight internal and external timelines
Game Plan
Basic Principles:
• Go into it with your eyes open• Instruct your team (consultants)• Resolve to stay at the table and never give up • Keep negotiations moving and go into negotiations organised
Before negotiations start, decide:
• What is worth fighting for?• What is a win?• What are you willing to invest in conflict?
Landowners’ Baseline Requirements for Business as Usual
Getting a deal that you can live with requires you to:
• Define your business needs
• Understand the Company needs
• Plan properly (both sides)
• Ask the right questions
• Make sure that you don’t end up with any legacy issues
Farm Business Requirements Based on Activities
The CCA governs WHAT, HOW and WHEN activities can be done on your Land.
Understand EXACTLY what activities they want to do on your property:
• Scout your property with a company scout and a constructor (you need to know where and how things will be built)
• Name infrastructure – yours and theirs
• Future projects and works – yours and theirs
• All parties sign off a map with agreed locations/GPS coordinates to a five (5) metre tolerance
The Cost of Conduct
How companies behave on your Land and in connection with you business, home and family is of utmost importance
Companies can’t pay their way out of situations they have behaved their way into
Basic Principles:
• Conduct is as important as compensation• Agree to how people are to operate on your property before
talking about money• Conduct should not be an after thought
Baseline Requirements of ConductBasic Principle:
• Communication is your best protection• From the start of your relationship keep records of all communications with the
company• Reviews and monitoring will reduce legacy issues and save time for both parties
During construction:• Rely on most recent drawing of infrastructure published to a five (5) metre tolerance• Attend the Icebreaker• Reviews for the lifetime of construction• Attend meetings for each construction phase• Notify of any changes to construction
On completion:• Compare CCA Map to As Built drawings• Review• Production terms of access
CCA Sign Up
The Map:
• Identify all infrastructure• Must match the activities in the CCA• Clearly defines boundary of the Land the subject of the CCA
Execution:
• Question how long for the company to sign off• No access until compensation paid• Land Liaison Officer plus one (1)
Wish List
• Government standard CCA written by Lawyers for Lawyers
• More emphasis on planning – less emphasis on disputes
• Decision makers for the companies should be at the table
For More InformationEmanate Legal
168 Flinders Street EastTOWNSVILLE QLD 4810
PO BOX 1984
TOWNSVILLE QLD 4810
P (07) 4727 0100F (07) 4727 0150
Suite 1, 79 Arthur StreetROMA QLD 4455
PO BOX 1058
ROMA QLD 4455
P (07) 4727 0170F (07) 4727 0150