EXPLANATORY STATEMENT
Issued by the authority of the Minister for Resources
Industry Research and Development Act 1986
Industry Research and Development (Northern Endeavour Temporary Operations Program) Amendment (Remediation) Instrument 2025
Purpose and Operation
Section 33 of the Industry Research and Development Act 1986 (the IR&D Act) provides a mechanism for the Minister to prescribe programs, by disallowable legislative instrument, in relation to industry, innovation, science or research, including in relation to the expenditure of Commonwealth money under such programs.
The statutory framework provided by section 33 of the IR&D Act enables a level of flexibility to provide authority for Commonwealth spending activities in relation to industry, innovation, science and research programs. This allows the Government to respond quickly and appropriately to the need to implement innovative ideas and pilot programs on an ongoing basis and as opportunities arise. Prescribing programs in legislative instruments provides transparency and parliamentary oversight of Government programs and spending activities, whilst reducing administrative burden on the Commonwealth.
Once a program is prescribed by the Minister under section 33, subsection 34(1) allows the Commonwealth to make, vary or administer arrangements in relation to activities under the prescribed program. Arrangements may include contracts, funding agreements or other arrangements, and may provide for money to be payable by the Commonwealth to one or more third parties. The power conferred on the Commonwealth by subsection 34(1) may be exercised on behalf of the Commonwealth by a Minister or an accountable authority of a non-corporate Commonwealth entity, or by their delegate (under section 36).
The purpose of the Industry Research and Development (Northern Endeavour Temporary Operations Program) Instrument 2020 (the Legislative Instrument) as amended by the Industry Research and Development (Northern Endeavour Temporary Operations Program) Amendment (Remediation) Instrument 2025 (the Amendment Instrument) is to prescribe the Northern Endeavour Temporary Operations Program (the Program). The Program is funded as part of the Australian Government’s commitment to decommission the Northern Endeavour Floating Production, Storage and Offloading (FPSO) facility and remediate the associated Laminaria-Corallina oil fields. The Program will remove the FPSO from the field, permanently plug and abandon all wells in the field, recover the subsea infrastructure, remediate the oil fields and dispose of or recycle both the FPSO and the infrastructure in a safe and environmentally responsible manner. The Legislative Instrument currently prescribes funding for:
- the operation and maintenance of the Northern Endeavour, and the wells and subsea infrastructure in the Laminaria-Corallina fields;
- decommissioning and activities in preparation for decommissioning;
- responding to emergencies relating to the Northern Endeavour or the wells and subsea infrastructure in the Laminaria-Corallina field;
- obtaining insurance in relation to the matters at paragraphs (a), (b) and (c); and
- membership of organisations that provide oil spill response services, training and equipment.
The Amendment Instrument amends the Legislative Instrument to authorise Commonwealth expenditure to remediate the Laminaria-Corallina fields and undertake disposal of associated infrastructure. The Amendment Instrument promotes greater consistency with the Laminaria and Corallina Decommissioning Cost Recovery Levy (the Levy), which ensures taxpayers do not bear the cost of the decommissioning of the FPSO, by broadening the supporting activities to manage and dispose of the subsea infrastructure and remediate the oil fields in a safe and environmentally responsible manner.
Funding authorised by this Amendment Instrument comes from Program 1.3: Supporting a strong resources sector, Outcome 1, as set out in the Portfolio Budget Statements 2025-26, Budget Related Paper No. 1.11, Industry, Science, Energy and Resources Portfolio (https://www.industry.gov.au/sites/default/files/2025-03/2025-26-department-of-industry-science-resources-pbs.pdf ) at page 38.
The Program will be delivered by the Northern Endeavour Branch within the Department of Industry, Science and Resources (the department).
The Program is captured within the Portfolio Budget Statement under Performance Measure 1.3, Supporting a Stronger Resource Sector, with figures not for publication (NFP), reflective of the commercial sensitivities related to the Program’s procurements and contracts. While the Budget allocation is NFP, contracts valued above the $10,000 threshold are published on AusTender, in line with Commonwealth reporting requirements.
All reasonable costs incurred by the Commonwealth in decommissioning the Northern Endeavour are offset via the Levy, which is due to end in 2030, unless terminated earlier to avoid the over-recovery of costs. It is anticipated that the Levy will be sufficient to cover all Program costs. Program funds will be allocated via a number of procurements, and will include some limited tender processes for smaller, time critical undertakings and open and competitive processes for significant activities. Procurements will be undertaken in line with Commonwealth requirements. The Program is administered by the department in accordance with the Public Governance, Performance and Accountability Act 2013 (https://www.legislation.gov.au/C2017A00092/latest/text) and the Commonwealth Procurement Rules (https://www.finance.gov.au/sites/default/files/2024-06/Commonwealth_Procurement_Rules-1-July-2024.pdf).
Spending decisions will be made by the Program Delegate. The Program Delegate is an SES officer who holds delegation under the department’s general financial framework, including delegation under the Public Governance, Performance and Accountability Act 2013, and sections 34 and 35 of the IR&D Act.
As this is a decision to allocate funding to the Program as a whole, which supports the implementation of policy decisions made by the Government, the Program will not be subject to merits review. Merits review of the Program would not be appropriate because decisions are budgetary decisions of a policy nature, rather than decisions immediately affecting any particular person's interests. The Administrative Review Council has recognised that decisions of this nature should be excluded from merits review (see paragraphs 4.18 to 4.19, What decisions should be subject to merits review? available at https://www.ag.gov.au/legal-system/publications/arc-what-decisions-should-be-subject-merit-review-1999).
Persons who are otherwise affected by decisions or who have complaints about the Program will also have recourse to the department. The department investigates any complaints about the Program in accordance with its complaints policy and procedures. If a person is not satisfied with the way the department handles the complaint, they may lodge a complaint with the Commonwealth Ombudsman.
Further details of the Amendment Instrument are set out at Attachment A.
Authority
Section 33 of the Industry Research and Development Act 1986 provides authority for the Amendment Instrument.
Constitutional Heads of Power
For the purposes of s 33(3) of the Act, the Legislative Instrument as amended by the Amendment Instrument specifies that the legislative power in respect of which the Legislative Instrument as amended by the Amendment Instrument is made is the external affairs power in paragraph 51(xxix) of the Constitution.
External Affairs power
Paragraph 51(xxix) of the Constitution empowers the Parliament to make laws with respect to ‘external affairs’. The external affairs power supports legislation with respect to places, persons, matters, or things outside the geographical limits of Australia. In that regard, funding provided under the Legislative Instrument as amended by the Amendment Instrument will relate to activities to decommission the FPSO, which is to be undertaken in an area that is geographically external to Australia.
Consultation
In accordance with section 17 of the Legislation Act 2003, the Department of the Prime Minister and Cabinet, the Department of Finance and the Attorney-General’s Department have been consulted on the Amendment Instrument.
Industry and impacted stakeholders are regularly consulted on the Program. Consultation on the Amendment Instrument was not considered necessary as the amendments are minor and technical and intended solely to ensure the Legislative Instrument properly captures the original scope of the Program as delivered by government.
Regulatory Impact
The Program has been assessed by the Office of Impact Analysis (OIA) as being non-regulatory in nature (reference number OBPR23-04174).
Statement of Compatibility with Human Rights
A Statement of Compatibility with Human Rights for the purposes of Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 is set out at Attachment B.
Attachment A
Details of the Industry Research and Development (Northern Endeavour Temporary Operations Program) Amendment (Remediation) Instrument 2025
Section 1 – Name of Instrument
This section specifies the name of the Amendment Instrument as the Industry Research and Development (Northern Endeavour Temporary Operations Program) Amendment (Remediation) Instrument 2025.
Section 2 – Commencement
This section provides that the Amendment Instrument commences on the day after registration on the Federal Register of Legislation.
Section 3 – Authority
This section specifies the provision of the Industry, Research and Development Act 1986 under which the Amendment Instrument is made.
Section 4 – Schedules
This section is a machinery clause that allows the Schedule to the Amendment Instrument to operate according to its terms.
Schedule 1 – Amendments
This Schedule amends sections 4 and 5 of the Industry Research and Development (Northern Endeavour Temporary Operations Program) Instrument 2020 to provide that the program provides funding to support activities to remediate the Laminaria-Corallina fields and the disposal of subsea infrastructure.
Attachment B
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Industry Research and Development (Northern Endeavour Temporary Operations Program) Amendment (Remediation) Instrument 2025
This Amendment Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Legislative Instrument
The Industry Research and Development (Northern Endeavour Temporary Operations Program) Amendment (Remediation) Instrument 2025 (Amendment Instrument) amends the Industry Research and Development (Northern Endeavour Temporary Operations Program) Instrument 2020 (the Legislative Instrument). It amends section 4 and 5 of the Legislative Instrument which prescribes the Northern Endeavour Temporary Operations Program, to authorise the Commonwealth to remediate the Laminaria-Corallina fields and undertake activities to support the disposal of the Northern Endeavour floating production, storage and offloading facility and associated infrastructure, in addition to matters that had already been prescribed in the Legislative Instrument.
Human rights implications
This Amendment Instrument does not engage any of the applicable rights or freedoms.
Conclusion
This Amendment Instrument is compatible with human rights as it does not raise any human rights issues.
The Hon Madeleine King MP
Minister for Resources