Contributed By Winston & Strawn London LLP
Natural resources in the UK include oil, natural gas, coal and minerals. Ownership of oil and gas within the land area of Great Britain is vested in the Crown by the Petroleum (Production) Act 1934 and the Continental Shelf Act 1964. The ownership of almost all coal in Great Britain resides with the Coal Authority, while ownership of gold and silver is vested in the Crown. Other minerals are in private ownership, with the owner of the land entitled to everything beneath or within it. Details of land ownership are held by the Land Registry. The Minerals Development Act (Northern Ireland) 1969 vested the ownership of most minerals in Northern Ireland in the Department of Enterprise, Trade and Investment.
The natural resources sector in the UK is regulated by a number of statutory bodies, depending on the mining activity and the location, including the Environment Agency in England, the Scottish Environment Protection Agency, Natural Resources Wales and the Northern Ireland Environment Agency, together with the Health and Safety Executive and the Department of Energy and Climate Change (DECC).
Planning Permission and Licences
Planning permission and licences are required from the relevant authority for the extraction of natural resources in the UK in addition to the rights of access granted by the landowner (for onshore natural resources), unless the land is owned by the Project Company. The Oil and Gas Authority (an agency of DECC) is responsible for issuing licences for oil and gas exploration onshore (excluding Northern Ireland which issues its own licences) and on the UK Continental Shelf, for regulating field development and oil and gas pipeline activities and monitoring environmental impact, including decommissioning. The Energy Act 2008 introduced further requirements for licensing, including for the offshore storage of natural gas and carbon dioxide, and additional requirements relating to the funding of the decommissioning of offshore installations. The Coal Authority (sponsored by the DECC) is responsible for issuing licences for coal exploration and extraction. The Crown Estate Mineral Agent is responsible for granting exclusive leases and licences for exploration and development of Royal Mines to mine gold and silver. There is no specific licensing requirement for the exploration and extraction of other non-fuel minerals.
Planning authorities play an important part in the regulation of mining activities in the UK. In England and Wales, planning permission is granted by the mineral planning authority, commonly the county council, and under the Planning Act 2008. The Planning Inspectorate makes recommendations to the DECC, which makes the final decision on applications to develop significant projects. In Scotland, planning permission is granted by the local planning authority and in Northern Ireland, planning permission is granted by the strategic planning unit.
There are no restrictions to trading most natural resources with other EU countries as the EU operates as a single market. Natural-resources exporters may, however, need a licence for the export of a number of strategic controlled goods, such as goods with a potential military use listed in the Export Control Order 2008 (as amended) which applies to certain metal fuels and alloys.
The environmental impact of natural resources extraction should be a prime consideration of project sponsors. The main source of environmental control in the UK is the planning permission regime. Most planning permissions impose environmental restrictions and obligations on the permit holder, including upon decommissioning. In addition, the Environmental Permitting (England and Wales) Regulations 2010 (as amended) requires environmental permits for most natural resources-related activities. Any impact on local wildlife may also give rise to the requirement to obtain a licence under various conservation legislation.