The Federal Court of Australia has found oil giant Santos failed to demonstrate it adequately consulted with affected persons in relation to its offshore petroleum development in the Barossa gas field in the waters of the Timor Sea, north of Darwin. This landmark decision is the first significant Australian case brought by First Nations peoples challenging a major offshore oil and gas project due to a lack of consultation.
Partner Damian Roe and Law Clerk Erin O’Shaughnessy outline further.
Background
As part of its Barossa Project, Santos is intending to drill eight wells in the Barossa gas field, located approximately 300 km north of Darwin and 138 km north of the Tiwi Islands. The aim of the Barossa Project is to provide a new source of natural gas to Santos’ existing onshore facilities.
Dennis Tipakalippa, Munupi Elder and Traditional Owner of the Munupi Clan, challenged the decision to allow Santos to proceed with the Barossa Project, arguing the National Offshore Petroleum Safety and Environment Management Authority (NOPSEMA) could not be satisfied that Santos adequately consulted in accordance with the relevant regulations. Such consultation was a precondition to NOPSEMA accepting the project’s environment plan (Drilling EP).
Reasons – Methodological Flaw
Justice Bromberg of the Federal Court of Australia found in favour of Mr Tipakalippa, finding that NOPSEMA could not have been reasonably satisfied that Santos had correctly identified each and every relevant person in accordance with the requirements of the consultation criteria under the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2009 (Cth) (the Regulations). The obligation imposed by the Regulations is that every relevant person must be consulted. A ‘relevant person’ includes:
a person or organisation whose functions, interests, or activities may be affected by the activities to be carried out under the environment plan.
NOPSEMA’s regulatory task included an assessment of whether the Drilling EP demonstrated that every relevant person was consulted. His Honour referred to this as the “universe of relevant persons inquiry”.
In order for NOPSEMA to be reasonably satisfied adequate consultation had been undertaken, His Honour considered that the Drilling EP must demonstrate a general methodology for identifying each person consulted. Despite Santos’ attempts to argue sufficient engagement with First Nations people had occurred, His Honour concluded that the information provided by Santos in the Drilling EP did not demonstrate a methodology sufficient to identify the universe of relevant persons. Rather, according to his Honour, Santos demonstrated a different or at least an incomplete approach.
There was an absence of information necessary to demonstrate that each person within the universe of persons required to be consulted was identified as a relevant person in the Drilling EP. Accordingly, NOPSEMA could not be satisfied, as required by law, that Santos had consulted as required and the acceptance given by NOPSEMA was deemed legally invalid.
The Federal Court has expedited an appeal by the oil giant, and a hearing will occur in November.
For more information, please contact HopgoodGanim’s Resources and Energy team.