Mining Law 2024

• Published date: 22 September 2023
• Subject Matter: Environment, Energy and Natural Resources, Energy Law, Environmental Law, Mining, Waste Management
• Law Firm: Milbank LLP
• Author: Mr John Dewar and Emily Whittaker

1. Relevant Authorities and Legislation

1.1 What regulates mining law?

Regulation of the mining industry follows the devolution of certain powers relating to mining from the government of the United Kingdom to the governments of Scotland, Wales and Northern Ireland. As such, some law applies to the whole of the UK, while some applies only to a particular part of the UK.

The principal sources of law in the UK are Acts of Parliament and associated statutory instruments, common law (essentially case law), and retained EU legislation. Mineral leases, planning consents and environmental consents will also contain terms and conditions with which mine operators need to comply, and many of these will be tailored to the particular project and the nature and location of the operations, imposing, for example, restrictions on traffic movements, limits on air and noise emissions, and the need to decontaminate and restore the site after closure.

The UK regulatory regime for mining also varies according to the mineral in question.

1.2 Which Government body/ies administer the mining industry?

The Government, and to some extent local authorities, set the policy framework within which the mining industry operates. The general position under the law of property is that landowners own the minerals beneath their land, and are able to license the right to exploit them to third parties. However, in some cases, all rights to search for and exploit minerals have been reserved for the Crown; for example, all naturally occurring gold and silver (historically referred to as Mines Royal) vest with the Crown, as well as oil and gas, and all minerals occurring on and beneath the seabed within 200 nautical miles of the coast. Licensing of exploration and exploitation of these minerals is either conducted on behalf of the Crown or by governmental bodies established for this purpose.

The ownership of the majority of unworked coal and coal mines in the UK (excluding Northern Ireland) belongs to the Coal Authority. The Coal Authority, established under the Coal Industry Act 1994, is an executive, non-departmental public body whose responsibilities include, amongst others, the licensing of coal mining operations, the administering of coal mining subsidence damage claims, and bearing the liability for contaminated mine water caused by historic coal workings. The Coal Authority sometimes owns non-coal mines and minerals in coal mining areas.

The exploitation of gold and silver is overseen by the Crown Estate and, in Scotland, the Crown Estate Scotland (together, TCE, established through the Crown Estate Acts of 1956 and 1961) through Wardell Armstrong, the Crown Estate Mineral Agent. TCE also manages the seabed to the 12-nautical-mile territorial limit and other rights including non-energy mineral rights out to 200 nautical miles in all parts of the UK. In this capacity, TCE grants licences for the extraction of marine sand and gravel resources from the seabed, as well as such minerals as salt, potash and polyhalite occurring beneath the seabed.

The Oil and Gas Authority (OGA), a State-owned company limited by shares, was formally established as an independent regulator under the Energy Act 2016, and is responsible for the licensing of offshore and onshore oil and gas operations in the UK, including exploration, production, decommissioning and abandonment.

In Northern Ireland, the Mineral Development Act (Northern Ireland) 1969 vested most minerals in Northern Ireland in the Department of the Economy. This enables the government of Northern Ireland to grant exploration and production licences in its own name. The main exceptions to this right are: (a) offshore oil and gas deposits which are administered by the OGA; (b) gold and silver which vest in the Crown; (c) "common" substances (including aggregates, sand and gravel); and (d) minerals which were being worked at the time of the 1969 Act.

As well as a licence to exploit minerals, planning consent is required to authorise any development works from the local mineral planning authority (MPA).

The Health and Safety Executive (HSE), formed in 1975, enforces health and safety regulation in England, Wales and Scotland, together with local authorities and other authorised bodies. In Northern Ireland, health and safety regulation is enforced by the Health and Safety Executive for Northern Ireland.

Environmental regulation is undertaken by the national environmental regulators and, in some respects, the local authorities. The principal environmental regulator for England (and in some subject areas across the UK nations) is the Environment Agency (EA), formed under the Environment Act 1995; for devolved matters in Scotland it is the Scottish Environment Protection Agency (SEPA), formed under the Environment Act 1995; in Wales it is Natural Resources Wales (NRW) (established in 2013); and in Northern Ireland it is the Northern Ireland Environment Agency (NIEA), which has been established as an executive agency within the Department of Agriculture, Environment and Rural Affairs since 2016. Natural England additionally issues licences under the wildlife and habitats conservation regime, as well as providing specialist input to other bodies.

The office for Environmental Protection (OEP), formed under the Environment Act 2021, is responsible for holding public authorities and governmental entities to account for the implementation of environmental policies in the UK by reference to legally binding targets. Amongst other powers, it has the ability to issue a decision notice setting out the remedial steps that such authority or entity should take, and to apply to the High Court for an environmental review, in each case, where there has been a failure by a public authority to comply with environmental law and that breach is considered to be serious. Furthermore, the recent regulations introduced under the Environment Act 2021 on 24 January 2022, among other things, require public authorities and governmental entities to co-operate with the OEP and to provide it with any reasonable assistance it requests. Such regulations also provide for OEP monitoring and reporting functions in relation to environmental plans, targets, and laws, and bolster the enforcement powers and other functions available to OEP to manage failures by public authorities to comply with environmental law.

1.3 Describe any other sources of law affecting the mining industry.

The principal legislation affecting the mining industry in the UK includes the following:

1. The Coal Industry Act 1994 establishing the Coal Authority and setting out the framework within which the coal industry currently operates.
2. The Mines and Quarries Act 1954 governing the management and control of mines and quarries.
3. The Mines Regulations 2014 establishing mine-specific health and safety regulations that are centred around major hazards within the underground mining sector, as amended post-Brexit by the Carcinogens and Mutagens (Miscellaneous Amendments) Regulations 2020, which adjust the occupational exposure limit values for certain hazardous substances which may be found in the workplace.
4. The Health and Safety at Work etc. Act 1974 and a large body of health and safety regulations of general application across all sectors, which includes the
   1. Explosives Regulations 2014;
   2. Control of Substances Hazardous to Health Regulations 2002;
   3. Dangerous Substances and Explosive Atmospheres Regulations 2002; and
   4. Provision and Use of Work Equipment Regulations 1998.
5. The Environmental Permitting (England and Wales) Regulations 2016 and equivalents in the devolved regions.
6. The Town and Country Planning Act 1990.

As a result of section 3 of the European Union (Withdrawal) Act 2018 (as amended by the European Union (Withdrawal Agreement) Act 2020, the majority of the directly applicable EU mining regulations remain in force after the UK's exit from the EU on 31 January 2020 as retained EU legislation that forms part of UK domestic law. In addition, new domestic legislation, such as the Environment Act 2021, has been introduced to improve air and water quality, tackle waste, increase recycling, halt the decline of species, and improve our natural environment.

2. Recent Political Developments

2.1 Are there any recent political developments affecting the mining industry?

Russo-Ukrainian Conflict:

The Russian invasion of Ukraine has prompted the UK to focus on energy independence. Notwithstanding the high commodity costs, imports of gas, oil and coal from Russia to the UK were worth a combined '1.3 billion in the year to January 2023; down from '4.5 billion in 2021 and '2.2 billion in 2022. This reduction can, in part, be attributed to the UK's ban on imports of gas from Russia, which began in early 2023. The government and the department for Business, Energy & Industrial Strategy (BEIS) have cited the loss of this energy source as justification to reopen coal mines. In a speech from the Secretary of State at the BEIS, it was noted that the aforementioned trend towards the expansion of operating coal mines was a result of increased energy demands following the end of COVID-19 lockdowns, and the need to reduce dependence on Russian energy. Alongside the reduction on Russian imports, Brexit has also led to additional customs formalities issued between exports and imports in the UK and the EU instigating a culture of resource nationalism. All of these factors have contributed to soaring energy bills, which have put pressure on UK households and as such resulted in a reconsideration of energy supplies by the Government that are in contradiction to climate change targets and the trend towards green initiatives, as discussed later in this section.

Foreign Investment:

The UK's public interest intervention regime under the Enterprise Act 2002 allows the Government to intervene in the merger control process (usually confined to competition review by the Competition Markets Authority (CMA) or...