ENVIRONMENTAL CLAIMS FROM LANDOWNERS

• Jurisdiction: Derecho Internacional

International Mining and Oil & Gas Law, Development and Investment
(Apr 2009)
CHAPTER 7A
ENVIRONMENTAL CLAIMS FROM LANDOWNERS
Gabriel R. Macchiavello
Rattagan Macchiavello Arocena & Pena
Robirosa Abogados
Buenos Aires

Gabriel R Macchiavello is a partner in Rattagan Macchiavello Arocena & Peña Robirosa and heads the firm's environmental group, which is composed of thirteen outstanding full-time lawyers. His work is focussed on advising multinational corporations on various environmental matters, including commercial transactions, investments, mergers and acquisitions. Mr Macchiavello has broad experience in complicate toxic tort and clean up cases. He has represented oil, gas and mining industries, energy and manufacturing companies in civil and environmental litigation at provincial and federal courts. He earned his law degree from Universidad de Buenos Aires in 1985. In 1987 he completed a graduate course in Environmental Law and Natural Resources at Universidad de Buenos Aires. He served at the National Environmental Department to develop projects pertaining to cleaning up contaminated rivers, where he was in charge of the design of regulations for the control of water pollution. He was counsel of the Inter-American Development Bank in drafting an Institutional Environmental Programme for Argentina. The Province of Neuquén selected him to coordinate an Environmental Institutional Strengthening Programme and to develop comprehensive environmental legislation for the oil and gas industries. In 1998 he was hired by the World Bank to implement the Environmental Protection Regulations for the Mining Industry in Argentina. He was also a member of the advisory committee of the Mining Policy Research Initiative of the International Development Research Center. He has written several articles connected with environmental law and has lectured in Argentina, Brazil, Chile, Perú, Colombia, the United States and Canadá. Assistant Professor, Natural Resources Law, University of Buenos Aires, 1995-2000; Visiting Professor, Environmental Law, University of Buenos Aires, Austral, San Andrés and Catholic University. He has co-authored the Argentine Chapter of the 2006-2009 edition of The International Comparative Legal Guide to: Environment Law; published by Global Legal Group. Mr Macchiavello is a member of the Buenos Aires Bar Association, International Bar Association, Inter-American Bar Association, Environmental Law Institute, Rocky Mountain Mineral Law Foundation, the Center for International Legal Studies, the Latin American Environmental Law Association, the Ethics Working Group at the Commission on Environmental Strategy and Planning IUCN and also a founding member of RIELA (Inter-American Network of Environmental Law Specialist). Currently, he chairs the Environmental Department of the Argentina Industrial Association.

I. Introduction

The Mining and oil and gas industries usually create conflict between operators and landowners, as consequence of the impact produced on the land and other impacts related to the development of those activities.

Those conflicts are usual since ownership over land is different form ownership over subsurface minerals.

In order to provide solutions to those conflicts, there are many ways in which the law approaches the different situations. In Argentina, mining and oil and gas industries are protected by public use privilege, by which all surface activities are subordinated to the needs of the mining and hydrocarbon industry, prior payment of compensation. Compensation encompasses easement and right of way in favor of miners and oil and gas producers.

The duty to pay compensation is set forth in the Mining Code (Section 146) and in the Federal Hydrocarbon Act (Section 100) intended to compensate the landowner for damages or impairment generated during the development of the activities, such as use of water, occupation of land to build up facilities, among other. Payment of compensation does not imply the occurrence of an unlawful act or behavior. On the contrary, the damages compensated are from the regular and lawful activities for which the government grants concessions.

In the past, surface owners sought damage compensation as part of their property right by claiming the payment of easement and individual damages.

But with the development of significant mining projects such as Bajo la Alumbrera (copper and gold), Cerro Vanguardia (gold and silver) and Salar del Hombre Muerto (lithium), governmental policies of the 90s encouraging mining and oil and gas activities, along with the privatization of the former state-owned oil and gas company and deregulation of such industry, environmental issues became an important topic the government had to address. And it did so through several regulations, including the amendment of the National Constitution in 1994 and the passing of the General Environmental Act ("GEA") in 2002.

As a consequence, nowadays landowners also seek for (i) site restoration and remediation; (ii) cease of contamination and (iii) changes in the way mining and hydrocarbon activities are developed.

Furthermore, in some cases surface owners claim that mining and hydrocarbon development is incompatible with their own activities, such as forestry, in which case they sometimes claim losses for failure to obtain organic certification.

The purpose of this paper is to outline the environmental claims from landowners and the Courts trends on those matters. For a better understanding of the issue it is necessary to briefly discuss the Argentine system on ownership and jurisdiction over natural resources and a general overview on the applicable environmental law.

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II. Ownership and jurisdiction over natural resources

Argentine law differentiates between the Real property and the mining or oil and gas property. Oil and gas fields and hard rock minerals, classified as first category of mineral by the Argentine Mining Code,¹ are state owned.

According to the National Constitution, the Argentine Mining Code, and the Federal Hydrocarbon Act (Law No. 17,319 as amended by Law No. 26,197), Provinces exercise eminent domain and jurisdiction over mines and oilfields in their territories.

Individuals and legal entities can apply for concessions from the National or Provincial Administration to explore and exploit mines or oil and gas fields, and may freely dispose of the mineral extracted within the areas of the concession.

As most likely a company holding title to mineral tenures will be different from the landowner, the Argentinean Mining Code and the Federal Hydrocarbon Act intend to harmonize the coexistence of the mineral titleholder and the surface owner by granting both parties different rights.

As in Argentina mining and oil and gas activities are regarded as of public interest, landowners cannot oppose nor block the entry to the property to the concessionaire. Plus, the Argentinean Mining Code and the Federal Hydrocarbon Act assure that the concessionaire can undertake all activities necessary for production.

On the other hand, as it was mentioned above, concessionaires must pay landowners compensation in virtue of the use of land and damages resulting from the easement.

III. Environmental Legal Framework

Over the last few years the development of environmental legislation in Argentina has undergone a rapid evolution at both the federal and provincial level.

Before the 90s there were some regulations, spread in the legal system, addressing specific matters, including environmental provisions.

As it has been mentioned before, in 1994 the National Constitution was amended and section 41 was incorporated. That section sets forth the right of all inhabitants to enjoy a healthy, balanced and suitable environment for human development and the duty to restore environmental damage.

Argentine environmental...