Australia: What constitutes "a material change in circumstances" under Queensland’s Petroleum & Gas Act?

Last Updated: 27 July 2013
Article by Paul Careless and Sarah Roettgers

To date, there have been no cases decided before the Land Court on the meaning of the words "material change in circumstances" in the context of their application under the Petroleum and Gas (Production and Safety) Act 2004 (Qld) (P&G Act). The term is not defined in the P&G Act or in any other relevant Queensland legislation.

Here we consider the meaning and provide some examples of situations where an activity may constitute a material change in circumstances.

The essential question is whether the parties would have negotiated or agreed a different amount of compensation if the new events or changes were known at the time the agreement was negotiated or the court determination made.

The word material was considered by the Land and Resources Tribunal (which preceded the Land Court) in the case of Hicks & Anor v Graham & Anor, Re [2004] QLRT 47 in the context of mining lease compensation review. In that case it was determined that a material change is a change that is pertinent to what compensation should be awarded.

If a pertinent change has been established, a Court or Tribunal has the opportunity to consider whether it is of such significance that any amendment to the original compensation is justified.

The case also considered the word 'circumstance', and in doing so, reference was made to the Macquarie Dictionary 3rd edition definition:

"... a condition, with respect to time, place, manner, agent etc., which accompanies, determines, or modifies a fact or event".

In this particular instance, the Tribunal accepted that the area of land disturbed by mining operations was a 'circumstance' for the mining lease.

While a change in circumstances needs to be established, it is not clear from the P&G Act whose circumstances need to be subject to such a change.  It could be either the circumstances of the resource authority holder or of the eligible claimant for compensation, i.e. either the owner or occupier, or only the circumstances (being the conduct of activities) by the resource authority holder.  It could also be a combination of both.

Therefore, it appears that a substantial decrease or increase in the intensity, scale, quality or nature of an authorised activity by the resource authority holder the subject of the original compensation arrangement is likely to be sufficient to trigger the jurisdiction.

It is difficult to give any mandatory prescribed benchmark which indicates when there may be a material change (for example, an increase by 5% or 10% in the area affected or a similar increase in the number of gas wells to be constructed on a given parcel of land) as the trigger will depend on the circumstances of each case.

However, for example, an increase in the area of land that would be affected by the activities, from that indicated when the compensation was originally agreed, might be regarded as constituting a material change in circumstances.

Conversely, a reduction in the number of wells to be drilled or a reduction in the area of the property to be affected by activities or a reduction in the period over which those activities are to be conducted, could constitute a material change in circumstances.

A change in technical methods of drilling wells or in installing infrastructure or the use of different and potentially environmentally harmful chemicals or other substances, which could result in greater compensatable effects on the land, may also constitute a material change in circumstances.

Under section 537C(3) of the P&G Act, the Land Court can only review the original compensation agreed to the extent it is affected by the material change in circumstances.  If the amount of compensation originally agreed took into account the intensification or increase or change in the nature, quality or quantum of the relevant activity, the Land Court is unlikely to review the original compensation.

Similarly if the compensation was in respect of certain activities, then all effects of those activities are likely to be within the scope of the original compensation, whether those effects were foreseen at the time or not. 

It is more difficult to indicate whether a change in the circumstances of the landowner or occupier, such as a change in its use of the land, would be a material change in circumstances.

It is arguable that an action of a landowner may constitute a material change of circumstance, for example if a landowner changes the use of the land to a use which was not contemplated or could not reasonably have been expected to have been contemplated by the parties and this new use is adversely affected (to a greater degree than the prior use) by the activities of the resource authority holder (where those activities have not changed in their nature, intensity or duration). Having said that, it is equally arguable (if not more so) from the alternative perspective that:

  1. the principle of "caveat emptor" should apply, i.e. if a landowner makes a change knowing that the activities will be carried out or are being carried out and knowing that the change would be to their own detriment, the landowner should not be entitled to further compensation; and
  2. if compensation was originally assessed on the highest and best use of the land (as is often the case, particularly in the assessment of compensation relating to mining leases) then the impact of the activities on any other intended use could only be less and therefore the amount of compensation could not increase.

Ultimately the issue will be what the original compensation was for and whether it adequately covered the effects on all possible future uses of the land and all possible impacts of the activities.

However, merely because there is a greater impact does not necessarily mean that this will constitute a material change in circumstances. It will depend on the terms of the conduct and compensation agreement negotiated between the resource authority holder and the landowner.

Even if there is a material change in circumstances, the Court may not necessarily order a variation to the original compensation agreed between a landowner and resource authority. Relevant to this point is the recent decision of Slater & Anor v Appleton & Anor (No. 2) [2013] QLC 13 which related specifically to the Mineral Resources Act 1989 (Qld). Here the Court determined that a material change in circumstances existed but rejected the argument by the resource authority holder that the material change warranted a reduction in compensation.

See also Reviewing compensation for resources tenures – What's done isn't necessarily dusted

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Most awarded firm and Australian deal of the year
Australasian Legal Business Awards
Employer of Choice for Women
Equal Opportunity for Women
in the Workplace (EOWA)

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions