Santos ordered to delay construction of proposed Barossa gas pipeline after surprise HQ inspection

Santos ordered to delay construction of proposed Barossa gas pipeline after surprise HQ inspection

by | Jan 25, 2023 | Business, News | 0 comments

The Federal Government’s petroleum regulator has said it discovered Santos had plans to start work on its Barossa gas export pipeline next month, during an un-announced inspection of its headquarters before Christmas, and issued a directive that the company must identify any underwater Indigenous cultural heritage places along the pipeline route, which follows a December court victory by a traditional owner.

The National Offshore Petroleum Safety and Environmental Management Authority environment division head Cameron Grebe issued four directions in a general direction order published on January 13, stating that on December 21 and 22 the authority conducted an environmental inspection on Santos’ headquarters “at short notice”, “relating to potential environmental impacts and risks of the activity not previously identified in the environmental plan”.

The direction ordered the company to tell the authority 10 days before any “future activities” to do with the pipeline, and that they must complete an assessment – using suitably qualified and independent experts with relevant experience and research credentials – to identify any underwater cultural heritage places for traditional owners along the route.

They have also been required to update their pipeline environmental plan to incorporate any new information from the assessment.

Santos would also have to give a report to traditional owners and NOPSEMA based on the assessment, and would then have to demonstrate how it would build the pipeline while reducing the environmental impacts and risks of the activity to be as low as reasonably practicable, taking into account advice from traditional owners.

The company is being forced to submit weekly reports to NOPSEMA detailing progress in undertaking the cultural assessment and how it has adapted it plans.

“On 21 and 22 December 2022, NOPSEMA conducted an environmental inspection on Santos’ registered business premises, at short notice, relating to potential environmental impacts and risks of the activity not previously identified in the EP,” the general direction states.

During the inspection, NOPSEMA inspectors identified that the registered holders [Santos] planned to commence the construction activity (for the pipeline) at the end of January 2023.

NOPSEMA Inspectors also identified more information was required to be obtained by the registered holders [Santos] regarding consideration of environmental impacts and risks of the activity to any underwater cultural heritage places along the Barossa pipeline route to which people, in accordance with Indigenous tradition, may have spiritual and cultural connections.”

 

Mr Grebe said Santos wrote to the regulator on December 22, stating it would undertake its management of change process covering the environmental impacts and risks of the pipeline not previously identified in the environmental plan.

In early December, the full Federal Court upheld a September ruling that invalidated Santos’ approvals to drill for gas in its Barossa gas project in the Timor Sea north of the Tiwi islands, after Munupi clan elder Denis Murphy Tipakalippa had taken the company to court in June, arguing they did not consult properly with traditional owners.

In a historic decision, the Court presided over by Justices Kenny, Mortimer and Lee, dismissed Santos’ arguments that Tiwi Islanders were not required to be consulted about potential impacts to “their sea country”. The decision may mean companies will not be able to rely on consulting only with land councils but must consult more widely, such as with clan groups.

The judgement said the Barossa Field sits in the Timor Sea about 300km north of Darwin, and 138km north of the Tiwi Islands. The judges said Santos intends to pipe the gas through a pipeline connected to an existing Bayu-Undan pipeline in Commonwealth waters and aimed to provide a new, 20-year source of natural gas for the company’s existing LNG facility at Wickham Point in the harbour outside of Darwin.

The pipeline will run about 7km from the western parts of the Tiwi Islands, at it’s closest point, the Energy News Bulletin reported.

Santos had argued that they did not need to consult with the Tiwi traditional owners because they did not have relevant interests and stated the company had consulted with the Tiwi Land Council.

 

In mid-December, the Environment Centre NT had said it lodged a formal complaint to the Australian Securities and Investments Commission and the Australian Stock Exchange about Santos, alleging Santos issued false and misleading statements to investors about its Barossa gas project during and after the court battle.

ECNT director Kirsty Howey alleged Santos told the Federal Court in June that delaying drilling would cost the company significantly but after its appeal was recently rejected, told the market the delay would not materially affect it.

“The company told the Federal Court in June that delaying drilling would cost the company hundreds of thousands of dollars a day,” she said.

“…In November, when the Federal Court rejected its bid to restore a drilling licence, the company told the market that, despite a delay of months, there would be no materials cost impact and the project timetable would stay on track. Santos can’t have it both ways,” she said.

Santos did not respond to a request for a comment about the allegations from the ECNT, and again did not respond to a request for comment about the NOPSEMA direction. In a media statement, Tiwi Islands traditional owner Simon Munkara said the situation with the pipeline was very serious for Tiwi residents.

“We want Santos to stop and communicate with us before starting any work on the pipeline because they might destroy our cultural and spiritual connections,” he said.

Environmental Defenders office special counsel Alina Leikin said they welcomed NOPSEMA’s decision because it recognised the pipeline posed significant risks to Tiwi cultural and spiritual heritage, and because it requires Santos to comprehensively assess those risks.

“Our Tiwi clients look forward to receiving further details and playing a central role in any assessment of cultural heritage to ensure its effectiveness.

“We will continue to work closely with our Tiwi clients to ensure their rights are upheld and their cultural heritage, in all its forms, is preserved for current and future generations.”

Dr Howey said that once again the Santos Barossa project had “been brought to a shuddering halt”.

“While Santos tries to assure shareholders that the project is on track, there is no doubt that this process will blow out Santos’ timetable,” she said. “Shareholders and investors should be asking whether this project will ever reach the finish line.”

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