Australia’s Indigenous Island Community Shuts Down $3.6 Billion Gas Drill | Energy News

Australia’s second-largest independent gas producer, Santos Ltd, has argued that it has all the necessary approvals to start drilling.

Australia’s Federal Court has ruled in favor of an Indigenous group’s challenge to a drilling permit for Santos Ltd’s Barossa gas development, in what the Santos company called a “disappointing” setback for the 3,000 project. $6 billion.

Traditional landowners in the Tiwi Islands, led by Dennis Tipakalippa, had petitioned the court in June to overturn drilling permission granted by the industry regulator – the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA).

Tipakalippa claimed that he and other Tiwi islanders hold “sea country” rights, including and beyond the Barossa field, and that his traditional lands are closest to the gas field.

Santos, Australia’s second-largest independent gas producer, argued it had all the necessary approvals after consultation with stakeholders.

The company also argued that Tiwi Islanders were not relevant stakeholders in the project and therefore did not need to be consulted.

Judge Mordecai Bromberg thought otherwise.

“Mr. Tipakalippa has established that NOPSEMA…did not, pursuant to the Regulations, assess whether the Drilling EP (Environmental Plan) demonstrated that Santos consulted with every person whom the Regulations required him to consult,” Judge Bromberg said. in a decision released Wednesday.

“The acceptance (or authorization) given by NOPSEMA was legally invalid. NOPSEMA’s decision to accept the Drilling EP must therefore be reversed,” the judge said.

Plans to appeal

Announcing a plan to appeal the decision on Wednesday, Santos said the decision should be reviewed by the full federal court, given the importance of the ruling to the company, its international joint venture partners and its customers.

Santos’ partners in the Barossa project are South Korean energy company SK E&S and Japan’s top power producer JERA, a joint venture between Tokyo Electric Power and Chubu Electric Power.

“This is a disappointing result,” Santos said in a statement to the Australian Stock Exchange, adding that the drilling in question was to take place at a site in the Timor Sea about 140 kilometers (86 miles) north of the Tiwi Islands. .

Tipakalippa, who filed the challenge, said Santos failed to properly consult traditional owners about the drilling and told the court the Barossa project posed a risk to sacred sites and their spiritual connection to Sea Country.

“We are so happy and so relieved. We won. The most important thing for us is to protect our maritime country,” Tipakalippa said in a statement.

Australian Greens MP Sue Higginson welcomed the decision in a tweet and praised former Tiwi Tipakalippa.

Important issues for Santos

The stakes are high for Santos.

Barossa is the company’s largest project and is critical to its Darwin liquefied natural gas (LNG) plant, which will lose supply from its base gas source, the Bayu Undan field, later this year.

Santos, who had agreed to suspend drilling for the project pending a court ruling, said he had “engaged” with indigenous representative bodies – the Tiwi Land Council and the Northern Land Council – about the drilling proposed, and the regulator had agreed to his efforts to consult with Tiwi Islanders.

The Barossa field is 265 km (165 miles) north of the gas city of Darwin on the Australian mainland and 138 km (86 miles) north of the Tiwi Islands.

Credit Suisse analyst Saul Kavonic said if Santos fails in its appeal and has to submit a new environmental plan, it could affect the overall cost and add months or even more than a year to the project schedule.

In addition to broadening consultations, Kavonic said, there is a risk that the regulator will broaden any review to include other considerations, such as reviewing emissions, as the country’s carbon emissions targets are stricter now than when the permit was approved.

About Walter J. Leslie

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