Federal Court judge Justice Mordy Bromberg on Wednesday ruled that the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA),which regulates offshore oil and gas projects,had approved Santos’ environmental plan without checking whether the company had carried out adequate consultation with all relevant parties,as required by law.
Santos called the decision a “disappointing outcome” in an announcement to the ASX. “Project approval uncertainty is a public policy issue that should be urgently addressed by Australian governments to reduce risk for trade and investment”,the company said.
The Federal Court backed Tiwi Islander Dennis Tipakallipa’s claim that Santos did not properly consult with his people.Rebecca Parker
Dennis Tipakalippa,a senior lawman of the Tiwi Islands,sued NOPSEMA alleging his Munupi Clan had not been properly consulted before the regulator approved Santos’ plan to drill up to eight gas wells about 120 km north of the islands.
“I am the happiest man alive,” Tipakalippa said. “The most important thing for us is to protect our Sea Country.”
Non-profit environmental law practice - Environmental Defenders Office (EDO),which represented Tipakalippa,had argued at the week-long hearing in August,which included hearing evidence on-country in the Tiwi Islands,that Santos’ inadequate consultation rendered NOPSEMA’s March 2022 approval of drilling invalid.
Bromberg said in the summary of his decision that Tipakalippa and other traditional owners had asserted their rights to the area being drilled 140km north of the Tiwi Islands based on longstanding spiritual connections and traditional hunting and gathering activities conducted by them and their ancestors.
Bromberg ruled that the plan did not show that Tipakalippa or other traditional owners of the Tiwi Islanders had been consulted by Santos and NOPSEMA had unreasonably approved the plan.
The ruling prevents Santos fromfurther drilling at the project,situated on the Timor Sea north of Darwin. Santos had agreed in August not to drill any new wells in the Barossa gas field and stop drilling its current well pending Wednesday’s ruling.
EDO counsel Alina Leiken said the decision put all oil and gas companies on notice.
“It sets a new standard about the consultation that companies are required to conduct with First Nations peoples before drilling in the sea” she said.
“This is a huge victory for the Munupi Clan and a testament to their strength and dedication in the face of one of the biggest mining companies in the country.”
Santos and its partners - JERA of Japan and Korean group SK - committed to the Barossa gas project in early 2021. They planned to spend $US3.6 billion ($5.5 billion) to drill the gas field and build a floating gas processing plant and a 260 km long pipeline to an existing pipeline to Darwin. In August,a decision to extend the pipeline all the way to Darwin to allow for possible carbon capture and storage of the high amount of carbon dioxide in the Barossa gas added $US622 million to the project cost.
Santos has contracted the Valaris MS1 drilling rig,reported as costing about $US220,000 ($330,000) a day to operate,until October 2023.
A NOPSEMA spokesman said the regulator noted the decision and was considering its implications.
“It is a matter for Santos to consider what the decision means for the Barossa project,” he said.
A halt to drilling would not immediately delay the completion of Barossa and its budget allowed for additional costs,Santos said.
Santos said drilling could recommence after approval of a fresh environment plan by NOPSEMA or a favourable appeal outcome by the Full Federal Court. The company will apply for leave to appeal.
In May 2021 Bromberg ruled that then Environment Minister Sussan Ley had a duty of care to protect children from the effects of climate change.
His decision in the case brought by eight school children against federal environmental approval for a Whitehaven Coal mine in NSW was overturned by the Full Federal Court in March.
Santos is also facing a legal case alleging it breached Australian consumer law by misleading investors about its climate credentials,or greenwashing.
The action launched by corporate activist group the Australasian Centre for Corporate Responsibility (ACCR) in 2021 under Australian Consumer Law focuses on the credibility of Santos’ plan to achieve net-zero emissions by 2040.
In August,ACCR added to its case Santos documents unearthed during the legal discovery process,which described some claimed emission reductions as “speculative”,“nominal” and “notional”. The case is expected to be heard in the first half of 2023.