AGL Energy Limited Annual Report 2011 Proceedings on Behalf of the Company Non-Audit Services Rounding Auditor’s Independence Declaration No person has applied under Section 237 of the Corporations Act  for leave of the Court to bring proceedings on behalf of AGL or  intervene in any proceedings to which AGL is a party for the  purpose of taking responsibility on behalf of AGL for all or any part  of those proceedings. AGL was not a party to any such proceedings  during the year. Non-audit services have been provided during the year by the  external auditor, Deloitte Touche Tohmatsu. Disclosure of the  details of these services can be found in this Annual Report on  page 97. The Board has a formal policy on the provision of auditing and  related services. Specifically, the external auditor is precluded from  providing any services that might threaten its independence or  conflict with its assurance and compliance role. Reports on the  provision of auditing and related services are provided at regular  intervals to the Board through the Audit and Risk Management  Committee. Directors are satisfied that the provision of  $2,056,000 of non-audit services by the external auditor is  compatible with the general standard of independence for auditors. The policy and procedures in place, and the review by the Audit and  Risk Management Committee, enable Directors to conclude that  non-audit services provided did not compromise the external  auditor’s independence requirements of the Corporations Act.  There is also in place an agreed rotation policy for the senior auditor  of Deloitte Touche Tohmatsu. The external auditor annually  provides a letter to the Company Secretary on its independence  within the meaning of relevant legislation and professional  standards. No officers of AGL were partners or Directors of  Deloitte Touche Tohmatsu during this reporting period. AGL’s constitution indemnifies, to the extent permitted by law,  officers of the consolidated entity when acting in their capacity in  respect of: The Directors named earlier in this report and the Company  Secretaries, Paul McWilliams and John Fitzgerald, have the benefit  of the indemnity, together with any other person concerned in or  who takes part in the management of the consolidated entity. During the year AGL paid premiums in respect of contracts insuring  all Directors of AGL as listed earlier, all Directors of related bodies  corporate of AGL, secretaries and other officers of the consolidated  entity against liabilities incurred in their capacity as Director or  Officer, as the case may be, of the consolidated entity. The contract prohibits disclosure of the nature of the liabilities and  the amount of premium paid and the Corporations Act does not  require disclosure of the information. A copy of the external auditor’s declaration under Section 307C of  the Corporations Act in relation to the audit for the financial year is  on page 135 of this Annual Report. AGL is an entity to which ASIC Class Order 98/100 applies and in  accordance with that Class Order, amounts in the Financial Report  and the Directors’ Report have been rounded off to the nearest  tenth of a million dollars, unless otherwise stated. > liability to third parties (other than related entities) when acting  in good faith; and > costs and expenses of successfully defending legal proceedings  and ancillary matters. Indemnification and Insurance of Directors and Offi cers Site Key Environment  and Planning legislation Comments AGL–Arrow  Energy Moranbah  Gas Project JV, Qld (Arrow is the  Operator) Petroleum Act 1923; Environmental Protection Act  1994; and Queensland Petroleum and  Gas (Production and Safety)  Act 2004 In September 2010, protected vegetation on PL191 was overcleared by the Operator. A  $2,000 Penalty Infringement Notice was issued by DERM in relation to the breach to CH4  Pty Ltd (the Arrow Energy entity named as Principal Holder on the relevant Environmental  Authority). In December 2010 the Operator submitted a Program Notice to DERM advising of the  threat of water storage overtopping due to heavy rain. A Transitional Environment Program  (TEP), to return the operation to compliance, was submitted but prior to its approval by  DERM an initial unauthorised release of 3ML from a water storage dam to the Isaac River  occurred following further sustained heavy rain. Subsequently the TEP was approved by  DERM. In March 2011, an administrative non–compliance was identified by DERM in relation to  non–submission of reports required as part of a TEP. In April 2011, between 11,000L and 20,000L of produced water leaked onto the ground  leading to short–term saturation. The spill was a breach of the Environmental Authority.  DERM has been notified about the incident. In May 2011, approximately 3,000L of diesel fuel was spilt to land. DERM was notified  about the incident. 47