BHP Petroleum Pty Ltd v Balfour

The High Court of Australia considered an appeal by BHP Petroleum Pty Ltd concerning a dispute over the interpretation of a petroleum production licence. The respondents, Mr Balfour and others, were holders of a petroleum production licence for an area offshore Western Australia. BHP Petroleum sought to challenge the validity of certain conditions attached to the licence, which they argued were imposed unlawfully by the Minister for Resources.

The central legal issues before the High Court were whether the Minister had the power to impose conditions on the grant of a petroleum production licence that were not prescribed by the relevant legislation, and if so, whether the conditions imposed in this instance were valid. Specifically, the court had to determine the scope of the Minister's discretion under the *Petroleum (Submerged Lands) Act 1967* (Cth) and the *Petroleum (Submerged Lands) (Registration Fees) Act 1967* (Cth) in relation to the imposition of licence conditions.

The High Court, in a joint judgment, held that the Minister's power to impose conditions on a petroleum production licence was limited to those expressly authorised by the relevant legislation. The Court found that the conditions imposed by the Minister in this case, which related to matters beyond the scope of the statutory requirements, were *ultra vires* and therefore invalid. The reasoning focused on a strict interpretation of the statutory powers granted to the Minister, emphasizing that any conditions imposed must have a clear statutory basis.

The appeal was allowed, and the orders of the Full Federal Court were set aside. The High Court declared that the conditions imposed by the Minister on the petroleum production licence were invalid.