Federal Court of Australia rules against Barossa drilling

The Federal Court of Australia has set aside the acceptance by the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) of an environmental plan covering drilling and completion activities related to the Santos-operated Barossa gas project in the Timor Sea north of Darwin.

Drilling activities, comprising eight new development wells in Barossa field, are suspended pending a favorable appeal or approval of a new environment plan.

The Federal Court judge found that Santos failed to adequately consult local indigenous people in the Tiwi Island, 140 km south of the project.

The Munupi elder, Dennis Tipakalippa, in the Tiwi Islands filed the case to challenge NOPSEMA’s decision to allow Santos to drill, arguing that the company had not considered his people’s connection to the sea country despite its requirement for NOPSEMA approval.

Santos claimed it had engaged with the Tiwi Land Council and the Northern Land Council about the proposed drilling and that NOPSEMA had accepted Santos’ efforts in accordance with regulations.

Santos had paused the drilling program in late August pending the Federal Court decision. The Federal Court judge ordered an injunction preventing drilling restart be extended until Oct. 6.

The $3.6-billion Barossa development, expected to pipe gas to the Darwin LNG plant to backfill waning supplies from Bayu-Undan field, is 46% complete.

The drilling activities are not on the critical path for the project, Santos said, noting headroom in the project cost contingency.