PEP 11 - New South Wales Legislation

BPH Energy Limited (ASX: BPH) (“BPH” or “Company”) refers to legislation Environmental Planning and Assessment Amendment (Sea Bed Mining and Exploration) Bill currently before the New South Wales (NSW) State Parliament.

Until the proposed Legislation actually becomes NSW law and has been reviewed by our legal advisers BPH is unable to provide any detailed comment except to say:-

PEP 11 – NSW Jurisdiction

1. The State of NSW and the NSW Government only have jurisdiction and the power to control exploration and extraction in coastal waters up to 3 nautical miles (4.83 km) offshore from the NSW coast. PEP 11 is beyond that 3 nautical mile limit and all such matters touching PEP 11 are under the jurisdiction of the Commonwealth of Australia (ie the Australian Government). Gas exploration operations including safety and environment are controlled by NOPSEMA (1) a Commonwealth of Australia authority.

2. The registered holders of PEP 11, including Bounty Oil & Gas NL (ASX:BUY), and the operator, Advent Energy (through Asset Energy Pty Ltd) are aware of the legislation and should it be enacted the titleholders will consider, if necessary, challenging the validity of the Bill under s 109 of the Commonwealth Constitution which provides: “When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid”.

3. The holders of PEP 11 intend to pursue gas exploration (by drilling around 26 km offshore) well beyond the limit of NSW coastal waters. No “mining” or pipeline construction is proposed.

4. Bounty and BPH fully support protecting the coastal and offshore marine environment and note that in respect of PEP 11 any activity undertaken in the permit area would require specific approval of the independent regulator NOPSEMA.

Extension and Variation Applications for PEP 11 Permit to Enable Drilling of Seablue 1 Gas Well at Baleen

In Asset Energy -v- Commonwealth Minister for Resources (Federal Court of Australia) 14 February 2023 the NSW State Government (as a member of the Joint Authority) was a Defendant and submitted to Orders directing them and the Commonwealth Minister to determine the PEP 11 extension et al applications according to law

While the applications for the variation and suspension of work program conditions and related extension of PEP-11 are being considered, Asset is continuing to investigate the availability of a mobile offshore drilling unit to drill the proposed Seablue-1 well on the Baleen prospect and is in communication with drilling contractors and other operators who have recently contracted rigs for work in the Australian offshore beginning in the first half of 2024. Further updates will be provided to ASX.

PEP 11 continues in force under the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (the Act) (Cth) and the Joint Venture is in compliance with the contractual terms of PEP 11 with respect to such matters as reporting, payment of rents and the various provisions of the Act.

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