Santos pauses drilling on $4.7b gas project until Federal Court decision

Gas giant Santos has promised to slow down its development of a $4.7 billion gas project in waters off Darwin that is being challenged by Tiwi traditional owners.

The Munupi clan on the Tiwi Islands are fighting to stop the company’s drilling in the basin north of the islands, arguing they were not properly consulted before the multi-billion-dollar project was approved.

After a week of evidence, including some heard in a special on-country hearing Justice Mordecai Bromberg heard Santos would pause drilling the Barossa gas fields before it reached a Timor Sea gas reservoir until a Federal Court decision could be reached.

The company also agreed to not drill any new wells until Justice Bromberg made a decision.

The Munupi clan welcomed Justice Mordecai Bromberg and lawyers with a smoking ceremony at Pitjimirra this week. (ABC News: Jacqueline Breen)

An environmental law group representing the traditional owners had argued that the federal approval granted in February was unlawful because Santos had not adequately consulted all relevant stakeholders.

At the final stage before approval, the Environmental Defender’s Office said Santos’s consultation was limited to two emails and a phone message sent to the Tiwi Land Council, all of which went unanswered.

Tiwi locals watch on during the on-country Federal Court hearing on the islands. — Clan watched from the sides of the beachside court hearing this week.(ABC News: Tristan Hooft)

Santos, as well as federal offshore gas regulator the National Offshore Petroleum Safety and Environmental Agency (NOPSEMA) — which granted the approval — have argued the gas company did fulfil its obligations.

The gas company said consultation with Tiwi Traditional Owners started in 2016, with some later consultation efforts derailed by COVID-19 restrictions limiting travel to remote communities.

Lawyers for NOPSEMA had argued it was not necessary for Santos to notify or consult with individual clan groups.

After traditional owners first launched the appeal in June Justice Bromberg rejected their request for an injunction preventing Santos from starting works on the project.

The company had drilled one out of six wells from which gas would be extracted and sent to Darwin through a pipeline that would run past the Tiwi Islands.

At that time, Justice Bromberg said the financial harm to Santos, in the order of hundreds of thousands of dollars a day, outweighed the concerns described by the traditional owners where a fast-tracked process had been arranged to hear the case.

In a media statement released after Friday’s hearing, plaintiff and senior Tiwi traditional owner Dennis Tipakalippa said, “drilling into the seabed is like drilling into our bodies”.

Dennis Tipakalippa launched the court challenge against the project with the help of an environmental legal group.(Supplied: Rebecca Parker)

“I’m relieved that Santos will drop drilling before it gets to the gas and will not start any new well,” he said.

“That is a big worry for us, so it’s very important to get that promise.”

In a statement earlier this week, Santos said it had “consulted with Traditional Owners on the Barossa Gas Project since 2016”.

“Santos will vigorously defend its position in these proceedings,” the statement said.

Gas production is expected to begin in 2025, with the project to create an estimated 600 jobs during construction as well as 350 ongoing jobs in Darwin over the next two decades.

Santos has said it plans to minimise climate-changing emissions from the project by using carbon capture and storage.

Justice Bromberg said the Federal Court would resume on September 16 for a final decision, or for arguments to be heard over an injunction on further drilling.

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