Environment Protection Authority v Pipeline Drillers Group Pty Ltd
[2012] NSWLEC 18
•20 February 2012
Land and Environment Court
New South Wales
Medium Neutral Citation: Environment Protection Authority v Pipeline Drillers Group Pty Ltd [2012] NSWLEC 18 Hearing dates: 2, 3 May 2011 Decision date: 20 February 2012 Jurisdiction: Class 5 Before: Craig J Decision: Proceedings 50036/10
1. The defendant is convicted of the offence against s 120(1) of the Protection of the Environment Operations Act 1997 as charged.
2. The defendant is fined the sum of $18,000.
Proceedings 50037/10
3. The defendant is convicted of the offence against s 120(1) of the Protection of the Environment Operations Act 1997 as charged.
4. The defendant is fined the sum of $12,000.
In respect of both offences
5. Within 28 days from the date of this order and at its expense, the defendant is to place a quarter page notice in the first six pages of the 'Port Macquarie News' newspaper and a third page notice in the 'Australian Pipeliner' in the form of Annexure 'A' to this order (pursuant to s 250(1)(a) of the Protection of the Environment Operations Act 1997)
6. Within 35 days of this order, the defendant is to provide to the prosecutor a copy of the notices published in the publications in accordance with order 5.
7. The defendant must pay the prosecutor's costs, as agreed, in the sum of $29,469, such sum to be paid within three months from the date of this order.
8. Pursuant to s 248(1) of the Protection of the Environment Operations Act 1997, the defendant must pay the prosecutor's investigation expenses, as agreed, in the sum of $14,531, such sum to be paid within three months from the date of this order.
9. Exhibits may be returned.
Catchwords: ENVIRONMENTAL OFFENCE - pollution - s 120(1) of the Protection of the Environment Operations Act 1997 - sewage pipeline installation - wetland area - horizontal directional drilling - discharge of bentonite slurry from drilling operation - reasonably foreseeable risk of harm - two unintentional offences - immediate containment and clean-up - actual harm - impact confounded by unassociated works in the vicinity - harm believed to be low and short term - no prior conviction - guilty plea - assistance to authorities - parity - costs - totality principle - publication. Legislation Cited: Crimes (Sentencing Procedure) Act 1999
Protection of the Environment Operations Act 1997Cases Cited: Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357
Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34; (2006) 145 LGERA 234
Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683
Environment Protection Authority v Baiada Poultry Pty Ltd [2008] NSWLEC 280; (2008) 163 LGERA 71
Environment Protection Authority v Coe Drilling Australia Pty Ltd [2005] NSWLEC 719
Garrett v Freeman (No 3) [2009] NSWLEC 1; (2009) 164 LGERA 287
R v Thomson; R v Houlton [2000] NSWCCA 309; (2000) 49 NSWLR 383
Veen v The Queen (No. 1) ;1979 HCA 7; (1979) 143 CLR 458 at 490Category: Sentence Parties: Environment Protection Authority (Prosecutor)
Pipeline Drillers Group Pty Ltd (Defendant)Representation: Mr P Barley (Solicitor) (Prosecutor)
Mr T G Howard (Defendant)
Gordon Plath, Environment Protection Authority (Prosecutor)
HWL Ebsworth Lawyers (Defendant)
File Number(s): 50036 of 2010 50037 of 2010
Judgment
The defendant, Pipeline Drillers Group Pty Ltd, has pleaded guilty to the commission of two offences against s 120(1) of the Protection of the Environment Operations Act 1997 ( the POEO Act ). The first offence occurred on 12 November 2009 while the second offence occurred four days later on 16 November 2009. It is now necessary to sentence the defendant for the commission of these offences.
Both offences involve the discharge of a bentonite slurry into a wetland known as the Partridge Creek wetland near Port Macquarie. Each discharge occurred while the defendant was undertaking horizontal directional drilling beneath the wetland.
Section 120 of the POEO Act provides:
" 120 Prohibition of pollution of waters
(1) a person who pollutes any waters is guilty of an offence.
(2) in this section:
pollute waters includes cause or permit any waters to be polluted".
The facts relevant to the commission of the offence are not in dispute. They are derived from an agreed statement of facts to which was annexed a bundle of documents; an ecological inspection report directed to the events giving rise to the offences prepared by Environmental Resources Management Australia; affidavit and oral evidence of Dr Neil Saintilan, a wetland scientist; a joint expert report prepared by Associate Professor Michael Mahony and Mr Ben Lewis, amphibian experts, together with their oral evidence; affidavit and oral evidence from John Whitbread, the sole director of the defendant, together with additional documentary material tendered by the defendant.
The Partridge Creek wetland
The Partridge Creek wetland is located in an area west of the Port Macquarie airport on the New South Wales mid north coast. It comprises an area of approximately 120 hectares, parts of which are wetlands identified in State Environmental Planning Policy No 14 - Coastal Wetlands ( SEPP 14 ). The discharges of bentonite slurry that are the subject of the present charges did not occur within a SEPP wetland area, although areas so identified were nearby. Vegetation in the general area where these discharges occurred is described as closed sedgeland.
The Partridge Creek wetland as a whole provided habitat for a variety of wildlife and vegetation. Relevantly, the area was identified as habitat for the Wallum Froglet ( Crinia tinnula ), a vulnerable species listed in Sch 2 to the Threatened Species Conservation Act 1995. Within the wetland area there were also stands of endangered ecological communities listed in Sch 1 to the latter Act. The area was subject to periodic inundation.
Background to drilling work
In about 2008, Port Macquarie Hastings Council ( the Council ) proposed the residential expansion of Port Macquarie by planning a new residential area to the west of the town known as Thrumster. This area was planned to accommodate 4,500 new dwellings with a population of about 11,000. Infrastructure for this new residential area necessarily involved a new or upgraded waste water or sewage treatment scheme to be located in the vicinity of the new residential area.
The Council owned most of the land that was the subject of the new residential scheme, including the Partridge Creek wetland. It proposed the location of elements of the waste water system within the wetland area, including pumping stations and interconnecting pipeline. For most of its length, it was intended that the pipeline be installed by means of open trenching. However, as two sections of the proposed pipeline route were planned to pass through particularly sensitive areas of the Partridge Creek wetland, installation by the horizontal directional drilling method was proposed.
As a general principle of environmental engineering where pipeline placement is required to be installed within environmentally sensitive areas, the horizontal directional drilling method is preferred over open trenching. As the description of this method of installation suggests, it involves the drilling of underground bores, generally in a horizontal direction and the placement of pipeline within those bores, thereby avoiding interference with the surface of the land.
In August 2008 a Review of Environmental Factors was prepared by Environmental Resources Management for the Council in relation to the Thrumster Sewage Transfer Scheme ( the Scheme ). This Review considered the horizontal directional drilling method for installation of the pipeline within the Partridge Creek wetland area.
In February 2009, the Council called for tenders for the horizontal directional drilling component of the Scheme. It sought and obtained the assistance of the New South Wales Department of Services Technology and Administration (then known as the Department of Public Works) to project manage the overall scheme, including the horizontal directional drilling work. Among the documents made available to prospective tenderers was the Review of Environmental Factors to which I have referred and to which was annexed an ecological impact assessment as well as an archaeological heritage assessment.
Prospective tenderers, including the defendant, were also provided with a report of a geotechnical investigation carried out in those areas where horizontal directional drilling for pipeline installation was proposed. That investigation was undertaken and the report prepared by Coffey Geotechnics Pty Ltd ( the Coffey Report ), a well known and well reputed company of geotechnical consultants. The geotechnical work involved drilling of a number of bore holes along the line of the proposed pipeline, providing soil profiles down to bedrock, laboratory testing of materials extracted from those bores and identifying potential acid sulphate soil locations. The scope of works for the report by Coffey was provided by the State Department of Commerce.
The defendant was the successful tenderer for the horizontal directional drilling component of the Scheme. Its tender having been successful, it then prepared, as it was bound to do, a construction environmental management plan (the CEMP ) for the work it was to undertake. In section 4.1.8 of the CEMP, the potential for bentonite slurry (used as a component in the drilling process) to escape or "break out" was recognised. So also was the consequence of breakout, namely smothering of a localised section of the wetland "resulting in an adverse impact on the biota." The CEMP next identified the procedures that would be deployed in order to mitigate the occurrence of "break out".
The CEMP prepared by the defendant was submitted to the Department of Public Works. The Department subsequently certified that the CEMP met the requirements of the NSW Government Environmental Management Systems Guideline.
Horizontal directional drilling and the use of bentonite
As I have indicated, horizontal directional drilling is used to install pipes underground in a manner that avoids vertical excavation for installation. It is a process undertaken in the manner described in the following paragraphs.
Bases are constructed for the pipeline at two points, namely the points at which the pipeline is to enter and then emerge from the ground. The entry point may be referred to as point A and the exit point as point B. A drilling machine is used to force a drill bit supported by drilling rods underground, commencing at point A and resurfacing at point B. Initially, a pilot hole is drilled, commencing at point A, with the direction and depth of the hole being guided electronically. Once the pilot hole is complete, the initial hole or annulus is widened or "reamed" by further drill passes with a reaming tool until the annulus is of a size that will accommodate a pipe of the diameter specified for the project being undertaken.
Once reaming of the annulus is complete, the drill bit is removed but drilling rods left in place. In the present case, high density polyethylene pipe was then connected to the drilling rods at point B and pulled back through the hole to point A.
During the drilling phase, a "drilling fluid" is used. This drilling fluid comprises a slurry of water and bentonite. Bentonite is a naturally occurring clay material, composed primarily of sodium montmorillonite and formed by the weathering of volcanic ash. It is a relatively benign material, being inert, chemically non-toxic and low in nutrient concentration.
Bentonite is distinguished from most other clays by reason of the fineness of its granular matrix and because of its unusually high absorption and swelling rates in water. It is used in the horizontal drilling process both as a lubricant for the purpose of drilling and reaming and as a sealant or stabilising material on the surface of the annulus created by the drilling or reaming process.
The bentonite slurry is pumped into the drilling rods and out through the drill head for the purpose of lubricating and smoothing the progress of the drill bit. The pressure under which the slurry is pumped then forces it back along the outside of the drill rods in the direction of point A. As it returns to point A, some of the bentonite hardens so as to create a firm surface to the drill hole in order to prevent the annulus from collapsing. The surface hardening by some of the slurry has the consequence that a portion of the bentonite is lost to the process. However, most of the slurry returns under pressure to point A where it is collected in a pit, recycled in refining machines and then reused as a lubricating agent. Once the initial pass is complete, the bentonite slurry can be collected at both points A and B.
The methodology just described is the usual methodology adopted by those engaged in the process of horizontal directional drilling. As the defendant's CEMP stated, a risk associated with that process, wherever it may be carried out, is that there will be a break out of bentonite slurry, referred to in the evidence as a "frac-out". A "frac-out" is the term given in the industry to an incident where the bentonite slurry is not contained within the annulus because, under pressure, it escapes to the surface due to some geological fault or weakness in the substrate.
Pipeline section to be drilled: its characteristics
The section of pipeline installation to be undertaken by the defendant using horizontal directional drilling involved a drilling length of approximately 500m. The defendant had moved points A and B for its drilling program from those points identified in the documents made available to tenderers by the Council. This change lengthened the horizontal drilling path by approximately 20m at each end of the route from that indicated in the tender documents. This was done so as to move the entry and exit points of the underground drilling further from the path of Partridge Creek and onto what was described as "solid ground". The defendant determined that this change would minimise the risk of impact from any frac-out that might occur. The location for the entry and exit points was on or adjacent to an area that had been disturbed by road construction followed by removal of that road. That work had been undertaken by the Council in about 2007.
The tenders called by the Council for horizontal drilling did not stipulate whether drilling in rock was required. However, as I have indicated, tenderers were provided with the Coffey Report. All tenderers submitted their tenders on the basis that drilling in rock was not required, having regard to the contents of that Report. So much is acknowledged by the prosecutor.
I have already recorded that a number of test bores were drilled along the proposed pipeline route by Coffey and identified in the Coffey Report. Soil profiles at each of these locations were provided. The geotechnical analysis of the substratum at each of these test bore sites indicated that the soil profile was of silt material, sand and then clay to a depth of about 15m. It was generally not until that depth was reached that rock was encountered although there was some variation in that depth along the pipeline route. The soil profile along that route was summarised in the Coffey Report in the following way (at p 13):
"The investigations revealed a variable profile that is typical of the geomorphic setting of the site, with interbedded and interlensed layers of silt and clay and sand within this coastal estuarine profile that deepened towards the centre of the wetland and overlay residual clays and weathered rock.
Within this profile, the main layers generally present were as follows:
A near-surface layer of loose to medium dense Aeolian SAND to depths of 4.3m.
An indurated SAND (coffee rock) horizon was present from 0.3m to 7.75m depth from [the] surface;
An upper layer of loose to medium dense Marine SAND, to depths ranging from 0.5m to 8.5m, generally below the water table and with Potential ASS sometimes present.
A lower layer of soft to firm Marine CLAY from 0.8m to 17.5mm from surface, generally below the water table and with Potential ASS present in some locations.
An underlying thick residual CLAY profile of medium to high plasticity Clay that graded gradually to extremely weathered and then highly weathered Sandstone, Siltstone or Slate."
In evidence, Mr Whitbread stated that, based on this summary, together with his understanding of the individual bore logs reported by Coffey, the material immediately above the reported rock surface was, in his opinion, suitable for horizontal drilling because of the high plasticity clay extending down to sandstone. That material represented a minimal risk of significant frac-out. His opinion was confirmed, so he indicated, by reason of observations made when he inspected the surface of the area to be drilled. He observed a number of excavations made for the purpose of archaeological investigation, noting that although these excavations had been made some 12 months prior to his inspection, the excavations or holes appeared to remain intact, with their sides still apparent and each of them held water. He concluded that the plasticity of the soil was such that it did not readily collapse, an important consideration when determining the likelihood of a frac-out.
Pollution incidents
During installation of the pipeline by the defendant there were three frac-out incidents involving the escape of bentonite slurry from the pipeline annulus. These occurred at different times during the drilling and pipe installation process.
The first frac-out occurred on 3 November 2009, shortly after the drilling of the initial pilot hole commenced. It occurred at a point that was only about 25m from the commencement point and it occurred in an area that was dry at the time. It was observed by an employee of the defendant who was monitoring the return of drilling fluid to the entry pit. Once the escape of drilling fluid was observed, drilling ceased and the frac-out area of approximately 7 m 2 was edged by sand bags. The fluid that had escaped into this area was there fully contained. In order to avoid the risk of recurrence at this location, a metal casing was placed in the drill hole along this initial section of the annulus in order to keep it open until the pilot hole was completed.
This first incident is not the subject of any present charge by the prosecutor. However, it is relied upon by the prosecutor as an incident which should have forewarned the defendant of the risks of the two further frac-outs that are the subject of the present charges.
The second frac-out occurred on 12 November 2009 during the reaming of the original pilot hole. The frac-out was discovered about 9.00pm on that day when an employee was monitoring return of drilling fluid on the exit pit side or point B of the operation. The line of drilling was also inspected to confirm the escape of drilling fluid. Immediately upon detection, drilling ceased and the frac-out area was surrounded by sandbags in order to contain the material. The point at which this frac-out occurred was said to be about 30m from point B, a location in which there was standing water. The initial placement of sandbags was insufficient to contain the pollutant. Additional sandbags were installed, silt curtains were put in place as was a floating boom. All were used to contain the spread of water containing the drilling fluid. In all, it is said that the body of water affected by the bentonite slurry had an area of approximately 12m x 70m.
An officer of the Department of Public Works was notified of the incident at about 8.00am on 13 November. The Department, in turn, notified the prosecutor later that same day.
Drilling did not recommence until all the measures that I have indicated were in place to contain the frac-out that occurred on the evening of 12 November. Although some further drilling fluid escaped once drilling commenced on 14 November, that fluid escaped into the area that was contained by sandbagging.
The precise time at which the third incident occurred is not known. It is likely to have occurred during the evening of 16 November although it was not discovered until 17 November 2009. It was discovered when an employee of the defendant was inspecting the area in preparation for the drilling of a second hole.
This frac-out occurred at a location somewhere between 125m and 200m from the site at which drilling commenced. At this location the annulus was at a depth of about 13m below the surface. It occurred while the high density polyethylene pipe was being pulled back through the annulus from point B. The drilling fluid escaped to the surface, mixing with standing water and, spreading to an area estimated to be approximately 1600 m 2 . Within that area, the polluted water was, in places, up to 850mm deep.
This incident is described as being "unexpected" and "unexplained". The return of drilling fluid was being monitored, as was pressure in the annulus during the pull back of the pipe. None of the observations being made at the time revealed any unusual or extraordinary change such as to suggest that a frac-out was either likely to occur or had in fact occurred. Drilling fluid continued to be returned through the annulus and, on this occasion, was being carted away to a containment dam located about 2km from the drill site.
The site was inspected by officers of the prosecutor on 17 November 2009 in response to the report of the first and second incidents. They returned on 18 November after the third incident was reported. This led to the issue of a clean-up notice.
Once the third frac-out was discovered, all drilling work stopped and containment of the drilling fluid that had mixed with the standing waters was undertaken. Again, this involved a combination of sandbags, silt curtains and a boom. Clean-up of the site commenced immediately thereafter. It involved a combination of vacuum pump, shovels, buckets and other equipment directed to removal of bentonite sediment and the cartage of it from the site.
The removal operation occurred over a period of two to three weeks. It involved the employment of 10 staff members with operations conducted on a 12 hour shift basis. The clean-up process was supervised both by officers of the Department of Public Works and consultants employed by Environmental Resources Management. Mr Whitbread stated in evidence that the clean-up work succeeded in removing "99 per cent of the material from the bottom of the wetland." His evidence in that regard was not challenged by the prosecutor.
Causes of incidents not known
The direct cause of the incidents that are the subject of the present charges is not known. Each of them was an unexpected incident. In relation to the second frac-out, it was said to be unexpected because pilot hole drilling had been completed prior to the incident. It was the drilling of the pilot hole which presented the highest risk of frac-out. As this had been completed without incident, frac-out was not expected to occur.
The reason for the third frac-out remains in the realm of speculation. Given the depth of the annulus beneath the surface at the time the frac-out occurred, Mr Whitbread could only speculate as to what its cause may have been. One thesis was a geological fault within the path of the annulus which was not identified in the Coffey Report. This is possible given that the bore holes dug along the pipeline path could only reveal the geology within those bore holes, requiring interpretation or extrapolation of what the geology may be in the interstitial space. It is not suggested that extrapolation of the data would indicate a geological fault or aberration of which the defendant ought to have been aware.
However, it is to be noticed that the Coffey Report did contain what was, in effect, a disclaimer, indicating the need to exercise caution in extrapolating information from bore hole logs to other locations. The disclaimer further indicated it to be "unlikely the information is sufficient to pre-empt the full range of conditions which will be encountered during construction."
Another thesis advanced by Mr Whitbread related to the test bore holes themselves. He indicated that although he had been involved in horizontal directional drilling projects for about 11 years, he had not previously encountered the situation where bore holes had been dug to examine geology and not subsequently grouted. Apparently he discovered that one or more test bore holes dug in the present case had not been grouted, with the result that drilling fluid under pressure could have escaped the annulus through a bore hole. This, he acknowledged, was speculation.
Sentencing considerations
The sentence to be imposed for the present offences is one that reflects both the objective gravity of the offence as well as the personal or subjective circumstances of the defendant. In that regard, I am required to consider, and have considered, the factors of relevance in s 21A of the Crimes (Sentencing Procedure) Act 1999 ( the CSP Act ) as well as s 241(1) of the POEO Act. The purposes for which a sentence may be imposed are those identified in s 3A of the CSP Act.
Further, the objects of the POEO Act cannot be removed from consideration of an appropriate sentence. Those objects, as stated in s 3, include not only protection, restoration and enhancement of the quality of the environment of this State, but also include an object:
"(d) to reduce risks to human health and to prevent the degradation of the environment by the use of mechanisms that promote the following:
(i) pollution prevention and cleaner production,
(ii) the reduction to harmless levels of the discharge of substances likely to cause harm to the environment,
... ".
Objective circumstances
Nature of the offence
The pollution of waters contrary to s 120 of the POEO Act is an offence of strict liability. It has been described as being "a result offence".
The maximum penalty for the commission of an offence against the section by a corporation is $1M. That maximum penalty is a reflection of the seriousness with which the commission of the offence is regarded by the legislature.
The objective gravity of an offence against s 120 has two principal components. Those components are the "precise acts or omissions of the offender and the consequences of those acts or omissions" ( Environment Protection Authority v Baiada Poultry Pty Ltd [2008] NSWLEC 280; (2008) 163 LGERA 71 at [22]). Assessment of these components of objective gravity is a purpose served by considering those matters to which s 241(1) of the POEO Act directs attention.
Actual or likely environmental harm: s 241(1)(a) POEO Act
(a) General
In the present case, it is not in dispute that actual harm to the environment was occasioned by the discharge of bentonite slurry into the Partridge Creek wetland. In the context of the general ecology of the wetland, the discharge of the bentonite slurry had the effect of smothering some plants and preventing or limiting access to food sources by species using those areas in which there was standing water. In the case of the Wallum Froglet, the deposition of the slurry into standing water areas had the potential to impair the feeding of tadpoles. During the containment and clean-up operations, the existence of sandbags and booms are likely to have impaired movement of Froglets around or through the area. While these impacts may be stated at a level of generality, the extent to which they reflected an impact is not at all clear. This observation requires further elaboration.
The area of the Partridge Creek wetland in which the second and third frac-outs occurred is an area that had been disturbed by road construction undertaken by the Council. The construction of that road was the subject of a prosecution against the Council and a senior employee of the Council by the present prosecutor ( Garrett v Freeman (No 3) [2009] NSWLEC 1; (2009) 164 LGERA 287). It was constructed to accommodate two-way traffic, surfaced with clay gravel and complete with culverts and other features appropriate for such a road. As a consequence of the prosecution brought against the Council, the road was removed, to the intent that the area that had been disturbed should be rehabilitated so that regeneration of local plant communities could take place. At the time of the commission of the present offences, the path of the old road was apparent with regeneration of many plant species yet to occur. Works associated with road construction and removal had the effect of significantly confounding any conclusions that might otherwise be drawn about harm, actual or likely, occasioned by the events giving rise to the present proceedings.
(b) Wetland ecology
A further confounding element was the consequence of action taken by the Council in about 2002. The area in which horizontal drilling was taking place was an area that had been identified as an acid sulphate soil "hotspot". As a consequence, an acid sulphate soil remediation program was undertaken. That program involved construction of a weir on Partridge Creek, designed to maintain groundwater in the wetland at a level of 0.9m AHD. The purpose of so doing was to limit the exposure of acid sulphate soils to air during periods when the water level otherwise receded. Exposure of sulphidic soils to air has the effect of releasing acid into the environment. The change brought about by construction of the weir clearly impacted upon the ecology of the area.
General assessment of harm as a consequence of the spill was the subject of evidence from Dr Neil Saintilan, a Principal Research Scientist and Head of the Rivers and Wetlands Unit in the Department of Environment Climate Change and Water. Dr Saintilan first visited the sites of the second and third frac-outs on 26 November 2009. Soil samples were taken from both within and outside the areas affected by those frac-outs. As would be expected, Dr Saintilan stated that by reason of the depth of bentonite then observed in the area of the third frac-out, "herbaceous vegetation growing within the impacted site would have been smothered by this clay layer." Dr Saintilan described the area of the second frac-out as being largely unvegetated, having previously been cleared for the construction of a road. Trampling of regrowth was evident. He indicated "that regrowth of some species at this site may have been arrested by smothering from the bentonite frac-out."
Having regard to his observations made on that inspection and with the benefit of testing of core sediments which he had taken, he noted two matters:
(i) as the fine texture of the bentonite clay was "in common with the texture of the inorganic (clastic) material of the swamp" long-term problems were unlikely to be imposed upon the plant community occupying the wetland; and
(ii) although the bentonite profile was of lower phosphorus than the natural soil of the site, it was unknown whether phosphorus was a limiting nutrient in the swamp and, in any event, he expected that "most species present would be capable of accessing phosphorus from beneath the bentonite layer."
Dr Saintilan returned to the site of the three frac-out locations on 22 March 2010. He observed that, with the exception of heavily vegetated patches, the bentonite observed on his first visit had been removed to depths below 50mm. He recommended against any further attempts at removal, given the prospect of damage to dense vegetation by attempting that removal. Importantly, he observed that regrowth was evident at those sites earlier impacted by the removal of bentonite.
Ultimately, Dr Saintilan indicated that only one long-term impact was possible. That was the prospect of expansion of the exotic grass Setaria sphacelate . This species could spread to those areas disturbed by the discharge of bentonite slurry and also disturbed by the remediation activities. Setaria species had established in the vicinity of the second frac-out site but, as Dr Saintilan acknowledged, that was due to the disturbance of the area associated with the roadworks that had been carried out by the Council. He acknowledged that there was no evidence of recent colonisation of disturbed areas by Setaria species.
In order to assess the likely long-term impacts, if any, from the frac-outs that had occurred in November 2009, Dr Saintilan relied upon observation that he and fellow scientists from his Department made at a wetland located at Coopernook, some 80km from the present site. A discharge of bentonite into the Coopernook wetland had occurred in September 2004. Having regard to the description given by Dr Saintilan, the vegetation communities present in that wetland would appear to be similar to those found in the Partridge Creek wetland, at least in those parts where the frac-outs occurred.
Physical damage to wetland vegetation by smothering with bentonite had occurred at Coopernook. As was the case at Partridge Creek, damage had also occurred by trampling during operations to remove the bentonite. The scientist who had assessed the consequences of that spill had concluded that long-term damage to the aquatic plant communities was unlikely on the basis that bentonite was a naturally occurring clay which would not inhibit root penetration. Regrowth of damaged plants was estimated to occur in one or two growing seasons.
Dr Saintilan revisited Coopernook in March 2010. Sites where the 2004 discharge of bentonite slurry had occurred were not identifiable by surface observation and could only be detected through tests of the soil profile. He indicated that there were no obvious ongoing impacts, with regrowth of understorey appearing to be complete.
Based on observations of the subject site and conclusions that could be drawn from re-visiting the Coopernook site, Dr Saintilan concluded that bentonite discharges "did not lead to significant long-term impacts in wetlands, with the exception of minor structural changes due in part to the nature and extent of the clean-up procedures". He acknowledged that a confounding factor in the present case was both the disturbance resulting from road construction carried out by the Council and the impact upon the ecology by reason of the weir construction on Partridge Creek. He had not appreciated that the latter event had occurred. Moreover, since the frac-outs in the wetland in 2009, there was no evidence of Setaria species extending into the areas affected by either the bentonite deposits or the clean-up operation to remove it.
(c) Wallum Froglet
Impact upon the Wallum Froglet was the subject of evidence from Dr Mahony and Mr Lee. There is little difference between them in their expressions of opinion. To the extent that there are differences, those differences seem to me to be of little consequence in determining the issues on this matter. They are agreed that the Partridge Creek wetland, as an area in general, provides habitat for the Wallum Froglet and did so at the time at which each of the two frac-outs occurred. The species is recorded as being present in areas that were reasonably proximate to those parts of the wetland into which the bentonite slurry discharged. However, prior to those occurrences, there is no evidence that the Froglet had been located within the areas so affected, although surveys conducted in March 2011 revealed the presence of the Froglet within those areas. Finally, they agree that the species is capable of travelling significant distances across the terrain which defines the extent of their habitat.
Another amphibian known to have habitat in the Partridge Creek wetland is the Common Eastern Froglet, regarded as being a competitor of the Wallum Froglet. Some surveys of the wetland indicate that the two Froglets co-occur, notwithstanding that the Wallum Froglet is seen as a "habitat specialist", occupying areas where the pH level of the water is lower than that preferred by other species, including the Common Eastern Froglet.
Related to the issue of increased competition between the two Froglets was the effect of the bentonite slurry on the pH level of waters into which it discharged. Both experts accepted that the slurry had the prospect, at least in the short term, of elevating the pH level of that water. They also agreed that the pH level of waters in the Wallum Froglet habitat is in a range of 2 through to 6.7. Mr Lee had tested water in the area of each of the three frac-outs which indicated a range of 4.92 to 6.01. That compared with a range of pH values for water outside the frac-out areas as being between 2 and 5.99. While Dr Mahony posited that the discharge of bentonite slurry into these areas might have elevated the pH levels of water immediately after discharge, he could not identify what that level might have been nor the impact, if any, upon the Wallum Froglet, assuming a change in pH level. In short, he accepted that levels measured by Mr Lee were well within the range expected of habitat for the Wallum Froglet.
If there was any increase in competition from the Common Eastern Froglet in the frac-out areas, Dr Mahony was unable to indicate whether that could be due to a change in pH level of the water or by reason of disturbance occasioned by the road construction and its subsequent removal. It should be noted that there was no evidence presented indicating that the areas affected by frac-out reflected an increased population of the Common Eastern Froglet compared to that which had existed prior to the commencement of horizontal drilling.
There was a difference between Dr Mahony and Mr Lee as to whether the precise areas affected by the frac-outs were themselves habitat for the Wallum Froglet. The distinction that Mr Lee sought to draw was between the overall area where the calls or presence of Wallum Froglets had been recorded and the absence of any recording of the Froglet within any of the three frac-out areas. In drawing this distinction, he did not resile from the observation that the Partridge Creek wetland, having an area of about 120 hectares, was a recognised habitat for the Froglet. He maintained his position of the basis that prior to the commencement of horizontal drilling, no recording of Froglet on the site of the frac-outs had been made, and that their presence in those locations was unlikely given the disturbance created by the Council road construction and its subsequent removal.
While Dr Mahony could not identify any record which placed the Wallum Froglet precisely within the site of any of the three frac-outs, he was confident that those areas should properly have been regarded as habitats, given the population of the Froglet within the wetland area generally. He based his conclusion upon the capacity of the Froglet to travel considerable distances and also to occupy reasonably disturbed areas provided both water and bordering vegetation conditions were appropriate. He saw no reason why this would not be the case in the frac-out areas and considered that the Froglet would, at the very least, have moved through those areas.
I accept the evidence of Dr Mahony in this regard. The characteristics of the Froglet, its movement patterns and its capacity to occupy recently disturbed areas, as evidenced by its presence on the frac-out sites in 2011, are all matters supporting Dr Mahony's opinion. Those characteristics that I have identified were not challenged by Mr Lee, his fundamental position being the absence of any recorded finding of the Froglet in those areas.
However, this does not result in any finding of significant environmental harm upon the Froglet. Dr Mahony readily acknowledged the abundance of the species in the area and the fact that the affect, if any, upon the Froglet would only have been short term. This short term affect may have been had upon tadpoles being unable to feed at the base of the water body, due to the smothering of benthic material. Nonetheless, Dr Mahony did acknowledge that the capacity of the tadpoles to swim some distance would have allowed most to move into areas unaffected by the benthonite deposit.
The second area of impact was possible impairment of movement of the Froglet through the area due to sandbag placement, silt curtains, booms and other measures taken in order to contain the spill areas. This impact would, of course, have been short term.
One final matter raised in relation to the effect upon the Froglet was the disturbance to the water body in the frac-out areas occasioned during the clean-up operation. Because of the very fine nature of the bentonite sediment, it was readily suspended in the water column as workers moved through the area carrying out clean-up activities. While the National Recovery Plan for the Wallum Froglet had identified areas of water with very low turbidity as being desirable for repopulation of the Froglet, Dr Mahony acknowledged that no research had been done to indicate the effect, if any, upon the Froglet where water bodies were subject to periodic turbidity or suspension of particulate matter.
(d) General assessment of harm
Taking all these matters into account, I accept the submission of the prosecutor that the incident did occasion actual harm to the environment, having regard to the manner in which that expression is defined in the POEO Act. The area affected by that harm was agreed to be about a quarter of one hectare within a wetland area occupying about 120 hectares. That harm was clearly short term. As I have indicated, it involved the smothering of some plants when the second and third frac-outs occurred, followed by additional harm occasioned by clean-up activities. That harm includes indirect harm to those having an ecological relationship to those areas that were directly harmed ( Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34; (2006) 145 LGERA 234 at [174]).
As will be apparent from my discussion of the evidence, both the nature of the bentonite slurry pollutant and the remedial action directed to its removal have combined to ensure, so far as it can presently be determined, that there is no long-term impact upon the Partridge Creek wetland. So to indicate does not, of course, suggest that discharge of the pollutant does not have significance ( Environment Protection Authority v Coe Drilling Australia Pty Ltd [2005] NSWLEC 719 at [164]).
I have discussed at some length the evidence directed to the Wallum Froglet. Having regard to the onus that is born by the prosecutor, I am not satisfied that actual harm to the Froglet has been proved. I accept that there is evidence of "likely harm" in that some tadpoles may have been affected and the movement of the Froglet inhibited by the protective and clean-up measures taken. However, the evidence of both Dr Mahony and Mr Lee must be acknowledged by which they indicated that, following the initial impact, there seems not to have been any long-term impact upon these species within the Partridge Creek wetland.
To similar effect is the evidence of Dr Saintilan in relation to the wetland ecology generally. The evidence does not establish that even on the basis of likelihood, the discharge of bentonite slurry during either the second or third frac-out events is likely to increase the propensity of the exotic grass Setaria sphacelate from spreading into those areas. This conclusion is reinforced by the evidence of Dr Saintilan that upon inspection of the "benchmark" site at Coopernook, no evidence of the spread of the exotic grass species had been observed in those areas that had been the subject of bentonite spill at that location.
I therefore conclude that while the actual harm was significant, having regard to its duration and the apparent absence of long-term impact, my assessment under this head is that the overall harm was at a low level.
Practical measures: s 241(1)(b) POEO Act
For its part, the prosecutor submits that there were measures that could have been but were not taken by the defendant to prevent the harm occasioned to the environment by the discharge of bentonite slurry. Those measures are described as being:
(i) deeper drilling;
(ii) drawing the high density polyethylene pipe back through the annulus with the pipe end open rather than closed as it was, thereby occasioning less stress upon the annulus;
(iii) extending the length of horizontal directional drilling so as to remove the entry and exit points A and B further away from the environmentally sensitive areas;
(iv) undertaking or requiring a more thorough survey of the proposed drilling route;
(v) increasing its vigilance; and
(vi) having effective monitoring/control of bentonite slurry return while being used in the process of horizontal drilling and subsequent pipe pull-through.
For its part, the defendant points to the circumstance that there is more to be considered under this paragraph of the subsection than focussing upon prevention. In the context of control, abatement and mitigation of harm, it took prompt, appropriate and reasonable steps to address the discharge of bentonite slurry, once discovered. As soon as the discharge was detected, it ceased drilling operations in each case, took measures to contain the area in which the bentonite slurry had mixed with the standing water and then took clean-up measures, including removal of as much of the bentonite as was reasonably possible, without occasioning further harm to vegetation, including aquatic species growing in the wetland environment. I do not understand any of these matters to be contested by the prosecutor.
In relation to the prevention measures identified by the prosecutor, the defendant points to the requirement of paragraph (b) of subsection (1) that the measures taken to prevent harm are "practical measures".
The context in which this needs to be considered is one involving a competitive tender process in which each of the tenderers were submitting tenders on the same basis, relevantly, having been provided with a geotechnical report from which it could properly be concluded that drilling through material located immediately above bedrock level, rather than through bedrock itself, was appropriate. Certainly, there was no evidence forthcoming from the prosecutor to suggest that the decision to drill at the level at which the defendant did in fact drill was an inappropriate decision based on the material with which it was provided.
The prosecutor suggested by way of cross-examination of Mr Whitbread and in submission that a specialised frac-out analysis ought to have been obtained. The need for such analysis was denied by Mr Whitbread. There is no evidence before me suggesting that such analysis would ordinarily have been obtained when the geological profile presented in the Coffey Report was available. Further, the evidence does not establish that the risk of frac-out would have been identified as being high or unusual, given the nature of material through which drilling was to be undertaken and the depth at which that drilling was planned
It will be remembered that the defendant had, of its own volition, extended the length of horizontal drilling in order to remove the entry and exit points of that process further from the areas recognised as being sensitive. The third frac-out was the more significant of the frac-outs that are the subject of the present prosecution. That occurred along the required route of pipeline at considerable depth below the ground surface. It was a location through which the pipe annulus or pipe drawback would have occurred, no matter where the commencing and finishing points of the underground drilling process were located.
The second frac-out occurred some 30m from the end point or point B of the process. It occurred where the drill hole was angled from depth towards the surface. I accept that if point B was further removed from the sensitive areas and, assuming some geological fault or weakness at the point where this frac-out occurred, then the annulus would have been at a greater depth. Assuming those facts, whether a frac-out would still have occurred is unknown. It can be accepted that the prospect of occurrence may have been decreased but that prospect needs to be considered in the context of any evidence suggesting that the location of the exit point selected by the defendant was, on all the available evidence, inappropriate.
As I have earlier indicated, the third frac-out occurred while the high density polyethylene pipe was being drawn back through the annulus to point A. The leading end of the pipe was closed. However, the evidence is that as the pipe was being drawn, there was no indication of any change in pressure within the annulus and that the draw of that pipe occurred within a time and at a rate that was within the defendant's expectation. Had the closed end of the pipe been imposing an unexpected pressure within the annulus, then, according to the evidence of Mr Whitbread, who was undertaking the process, it would have been apparent in the controls that he was monitoring. It was not so apparent.
In the course of his evidence, Mr Whitbread indicated that, with the benefit of hindsight, two more test bores along the line of the pipeline could have assisted further in understanding the geology of the substrate through which drilling was to take place. However, he indicated that whether those bore holes were drilled in a location that revealed any geological fault that would explain the frac-outs, in particular the third frac-out, was a matter of chance.
It was Mr Whitbread's evidence, that, based on his experience in undertaking horizontal drilling for nearly 11 years, he had become accustomed to reading reports of geotechnical experts. Based on his reading of the Coffey Report, he was comfortable that sufficient information was provided to enable him to proceed with confidence that a frac-out, while possible, was unlikely. I accept his evidence in this regard.
While there were a number of instruments to which resort could be had in monitoring the drilling and pipe installation process, it seems that there was no instrument providing a measure of returned bentonite slurry at either points A or B in the process. The volume of slurry being injected was known by reason of tank size but the return slurry was, so it seems, essentially the subject of estimate, albeit based on experience. It was reliance upon an estimate that, in part, explained the failure immediately to recognise the occurrence of the third frac-out. The system worked well in discovering the second frac-out.
Whether there is a device for measuring and therefore carrying out a system balance on slurry injected and returned was not disclosed. However, relying upon observation, no matter how experienced, does seem to me to leave open the prospect of human error in respect of what is clearly an important element of the process and the source of potential pollution. While it would appear that something further could have been done in this regard, as the defendant submits, there is no evidence to suggest that the manner in which the horizontal drilling was being undertaken by the defendant or the equipment being used for that purpose was other than in accordance with best practice for that activity. That said, the absence of a mechanism to address an input/output slurry balance reflects an inherent problem or even fault with the system.
I am satisfied that there were further steps that could have been taken which were practical and which, if taken, may have prevented the harm that occurred. I am also satisfied that once the escape of bentonite slurry was discovered, the defendant acted promptly to control, abate and mitigate the immediate harm by taking the measures that it did, resulting in removal of most of the bentonite within a relevantly short space of time.
Foreseeability of risk of harm: s 241(1)(c) POEO Act
As I have earlier indicated, the risk of a frac-out is a recognised risk with the process of horizontal directional drilling. So much was stated in the documents provided to tenderers to the project and that is the reason why, as successful tenderer, the defendant was required to and did in fact prepare its CEMP. The identification of the risk procedures to mitigate bentonite slurry frac-out and the tracking procedures for use of that fluid during the process were all the subject of the CEMP that was certified by the relevant Department of State as meeting the requirements of the Government Environmental Management Systems Guidelines.
As I have earlier recorded, the cause of the two frac-outs that are the subject of the present charges is not known. It is certainly the case that the initial or first frac-out (not the subject of any present charge) indicated the prospect of a further frac-out occurring. However, given that it occurred at the commencement of operations and at a very shallow depth, the defendant says that it provided no true indication or warning of what might occur as drilling proceeded in accordance with its drilling progam.
The sensitivity of the area in which drilling was being undertaken was recognised. It was stated in the documents with which the defendant was provided at the time of preparing its tender. Those documents made clear that the purpose of requiring horizontal directional drilling was to avoid disturbance or harm within the Partridge Creek wetland. Harm to that area was therefore reasonably foreseeable as a risk from undertaking the horizontal drilling process, although I accept that the two frac-out incidents that are the subject of charge were not, themselves, foreseeable. So much is apparent from the evidence of Mr Whitbread.
Control of causes: s 242(1)(d) POEO Act
The defendant accepts that although the direct cause or causes of the two incidents with which it is charged are not known, it had sole control over the carrying out of the horizontal directional drilling which resulted in these offences. It was responsible for planning and carrying out the process.
Reasons for commission of the offence
A factor in determining the measure of criminality involved in the commission of an offence involves a consideration of the reasons for its occurrence ( Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 366).
In the present case, I accept that the pollution incidents were accidental. The defendant gained no advantage, financial or otherwise, from the commission of the offences. Indeed, it stood to lose from the commission of the offences, not only because each incident involved the cessation of drilling operations but, as happened, it could reasonably be expected to have incurred the cost of clean-up after the event.
The prosecutor made no submission directed to the defendant's reasons for committing the offence or its state of mind in so doing.
Deterrence
The prosecutor accepts that, having regard to the circumstances attending the commission of these offences, the need to reflect a component for specific deterrence ought not "weigh heavily" in determining the appropriate penalty.
The need for general deterrence does need to be reflected in the penalty imposed. While accepting that the commission of these offences was unintentional the purpose of the legislation would be frustrated if only a nominal penalty was to be imposed simply because the breach of the Act was determined to be accidental. Adherence to the legislation imposing offences of strict liability requires recognition that accidents, although regrettable, are part of the industrial landscape. This salutary fact, in turn, requires that the likelihood of their occurrence be recognised and all measures reasonably available be put in place to prevent them. The implementation of such measures must be recognised as a cost to be borne in any form of industrial undertaking ( Axer Pty Ltd v Environment Protection Authority per Mahoney JA at 359).
The potential for escape of drilling fluid in conducting horizontal directional drilling is clearly a recognised potential for harm. There must be an incentive for those undertaking activities of that kind to implement measures to avoid the risk of harm. That incentive will be provided if there is an awareness that significant penalties will be imposed if breach is found to have occurred.
Conclusion on objective circumstances
Having regard to the circumstances of the offence and the statutory provisions bearing upon the assessment of objective gravity, including those factors identified in s 3A of the CSP Act, I have determined that these offences are at the upper end of the low range of objective gravity of offences under s 120 of the POEO Act.
Subjective circumstances of the defendant
It is necessary that a proportionate sentence be one that reflects not only the objective circumstances of the offence but also the particular circumstances of the defendant. This requires the Court to take into account any personal mitigating factors as well as any aggravating factors personal to the defendant ( Veen v The Queen (No. 1) ;1979 HCA 7; (1979) 143 CLR 458 at 490).
The prosecutor acknowledges that there are no personal aggravating circumstances that should be considered in relation to the defendant.
Prior offences
The defendant has not been convicted of any prior offence for breach of environmental legislation in this State. It is entitled to the benefit of that clear record.
Plea of guilty
A plea of guilty was entered by the defendant on the third occasion upon which the matter was listed for mention before a judge of the Court. At that point in time, the defendant had the benefit of knowing the prosecutor's evidence and also the benefit of its own legal advice.
The prosecutor accepts that the plea was entered at an early stage of the proceedings and that the defendant should get the benefit of the utilitarian value of that early plea ( R v Thomson; R v Houlton [2000] NSWCCA 309; (2000) 49 NSWLR 383 at [152]).
Contrition and remorse
In addition to its entry of a plea of guilty, the defendant has expressed remorse by reason of the events that occurred in November 2009. In his evidence, Mr Whitbread stated that he was sorry for these incidents and apologised "unreservedly for the fact that bentonite slurry escaped into the wetland." He indicated that if he had entertained the prospect that those events would occur, he would not have proceeded with the project. His evidence was that he had declined projects in the past where doubt was entertained as to whether horizontal directional drilling could be undertaken without a frac-out occurring. He stated that in the past 10 years over 100 projects had been completed by his company without environmental incident.
As further evidence of the defendant's remorse, the immediate response to each incident is relied upon and, in particular, the actions taken by it to clean-up the area are noted. The evidence indicates that the defendant incurred costs of approximately $100,000 in addressing this clean-up. This figure included labour costs, material, equipment hire, disposal fees and cartage.
Finally, Mr Whitbread indicated that on all tenders for work submitted by his company after the incidents of November 2009, he had disclosed the fact that these events had occurred and that his company was being prosecuted for them. This disclosure had the prospect to impact upon the defendant's business.
Assistance to authorities
The prosecutor acknowledges the assistance and cooperation of the defendant in respect of each of the frac-out events with which it was concerned. This involved not only candid and prompt reporting of each incident but also making available to the prosecutor all personnel who could assist with enquiries.
Further, it is to be noted that in preparing this matter for hearing, the defendant, through its solicitor, cooperated in the preparation of documents for the sentence hearing, including the agreed statement of facts upon which reliance has been placed in preparing these reasons.
Finally, the defendant has agreed to pay the prosecutor's legal costs of $31,000 and investigation costs of $13,000.
Parity
The principle of even-handedness or parity in sentencing requires that a sentencing court have regard to the general pattern of sentencing for offences of the kind under consideration. This said, care must be taken in undertaking that task as the wide divergence of facts and circumstances leading to the imposition of a penalty in a prior case will almost invariably militate against direct comparability.
The only case to which the parties made reference in this context was the decision of the Chief Judge of this Court in Environment Protection Authority v Coe Drilling Australia Pty Ltd , a case to which I have already made reference. Like the present case, Coe Drilling involved horizontal directional drilling for a new pipeline beneath a wetland. The wetland there in question was a SEPP14 wetland, the drilling beneath which was to be undertaken at a level much closer to the surface than was intended in the present case. The proximity of the annulus to the surface was recognised in that case as involving a high risk of frac-out. No geotechnical assessment was made of the pipeline route. The affected area by slurry discharge was approximately three hectares. That is a considerably larger area than that which is the aggregate area affected by the two relevant offences in the present case.
Otherwise, the subjective circumstances of the defendant company were similar to those that pertained to the defendant in the present case.
The Chief Judge determined that a penalty properly reflective of the objective circumstances would be $30,000 but that taking into account the subjective circumstances, which included an early plea of guilty, a discount of 40 per cent should be applied so that the penalty imposed was the sum of $18,000. At the time, the maximum penalty prescribed for an offence against s 120 was $250,000. In addition to the fine than imposed, Coe Drilling was ordered to pay investigation and legal costs of $20,000.
That case is of some utility in considering the appropriate penalty in the present case. While the objective circumstances in Coe Drilling may appear to be more serious than those attending the present offences, the statutory context in which the penalty was there imposed differs from the present in fixing the maximum penalty. This is not to say that a multiplier reflecting the increase in penalty from $250,000 to $1M is to be applied when determining penalty in the present case. Rather, it is necessary to consider the appropriate penalty for the offence at the lower end of objective gravity, taking account of the maximum penalty and its expression by Parliament of the seriousness with which offences against s 120 are to be regarded.
Undertaking the instinctive synthesis required to determine penalty, I consider that an appropriate penalty in each case, subject to the principle of totality to which I will next turn, is the sum of $18,000. This sum takes account of the 25 per cent discount for the early plea of guilty together with a further discount for those subjective factors that are to be weighed in favour of the defendant. In fixing this penalty I also take account of the fact that the defendant is to pay legal and investigation costs totalling $44,000.
Totality principle
The defendant submits and the prosecutor accepts that this case is one in which the principle of totality should be applied. This necessitates consideration as to whether an aggregate fine of $36,000 is "just and appropriate" as reflecting the total criminality of the defendant referable to the offences charged ( Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683).
The two offences with which the defendant is charged are close in point of time and are part of the one activity for which it was engaged in the Partridge Creek wetland. In those circumstances I consider that the aggregate penalty is too high. A reduction in the penalty that would otherwise be appropriate for the third frac-out event seems to me to be appropriate, particularly given that this offence occurred while drilling was being undertaken at a depth below surface at which the escape of drilling fluid was unforeseen and unexpected.
In those circumstances, I propose to reduce the fine for the second offence to the sum of $12,000.
Publication notice
The prosecutor sought and the defendant has agreed that there should be a publication order made under the provisions of s 250(1)(a) of the POEO Act. The proposed order requires publication in a newspaper and "trade" newsletter or magazine in a form agreed between the parties. I agree that publication of such an order is appropriate.
Orders
For all these reasons, I make the following orders:
Proceedings 50036/10
1. The defendant is convicted of the offence against s 120(1) of the Protection of the Environment Operations Act 1997 as charged.
2. The defendant is fined the sum of $18,000.
Proceedings 50037/10
3. The defendant is convicted of the offence against s 120(1) of the Protection of the Environment Operations Act 1997 as charged.
4. The defendant is fined the sum of $12,000.
In respect of both offences
5. Within 28 days from the date of this order and at its expense, the defendant is to place a quarter page notice in the first six pages of the 'Port Macquarie News' newspaper and a third page notice in the 'Australian Pipeliner' in the form of Annexure 'A' to this order (pursuant to s 250(1)(a) of the Protection of the Environment Operations Act 1997)
6. Within 35 days of this order, the defendant is to provide to the prosecutor a copy of the notices published in the publications in accordance with order 5.
7. The defendant must pay the prosecutor's costs, as agreed, in the sum of $29,469, such sum to be paid within three months from the date of this order.
8. Pursuant to s 248(1) of the Protection of the Environment Operations Act 1997, the defendant must pay the prosecutor's investigation expenses, as agreed, in the sum of $14,531, such sum to be paid within three months from the date of this order.
9. Exhibits may be returned.
Annexure 'A'
" Pipeline Drilling Group Pty Limited
Pollution offence
Pipeline Drilling Group Pty Limited has been convicted in the Land and Environment Court of NSW of two offences of polluting waters at Partridge Creek near Port Macquarie airport. The offences occurred in the course of horizontal drilling work designed to protect environmentally sensitive wetlands. A quantity of bentonite slurry escaped from the drill hole and covered an area of approximately 2,500 square metres. Bentonite is a naturally occurring clay used in the drilling process. The company reported the incidents immediately upon discovery and voluntarily carried out a clean-up. The company pleaded guilty to the offences. The company was fined $30,000 and ordered to pay legal investigation costs totalling $44,000 to the Environment Protection Authority, now part of the Office of Environment and Heritage.
This notice was placed by order of the Land and Environment Court of NSW and was paid for by Pipeline Drilling Group Pty Limited."
Decision last updated: 20 March 2012
9
8
2