Santos has withdrawn applications for government approval of a pipeline for its $4.7 billion Barossa gas project near the Tiwi Islands and plans to rework and resubmit over fears within the company that cannot withstand a legal challenge in its current state.
The company this week pledged to spend $458 million on the pipeline, which is to link the Barossa field, 265km north-west of Darwin, to its existing gas liquefaction plant in Wickham Point, in Darwin Harbour.
However, three weeks ago, on August 12, Santos withdrew pending applications for two of the three government approvals needed for the pipeline to go ahead: one with the oil industry regulator and offshore gas, the National Offshore Petroleum Safety and Environmental Management Authority and the other with the federal environment department under the Environmental Protection and Biodiversity Conservation Act.
The third application, with the Northern Territory Environmental Protection Authority, is still ongoing but has been put on hold until Santos submits a new EPBC Act application.
A spokesman for Santos said “both documents have been withdrawn and are due to be resubmitted soon as a single reference under the EPBC Act”. Subject to obtaining new approvals, the company plans to begin laying pipes next year.
Santos did not answer questions about why the decision had been made.
However, executives are understood to have been concerned that the applications could be vulnerable to legal action over issues such as whether it has adequately documented the stakeholder consultations it was required to undertake as part of the process.
The company is already in federal court fighting allegations it failed to properly consult a group of Tiwi islanders over part of the project that is covered by an independent Nopsema approval, the drilling of eight wells in the Barossa field.
Launching the suit last June, Munupi senior lawyer Dennis Tipakalippa said: “Santos say they did consultations for this drilling project, but no one spoke to me as a traditional owner and senior lawyer for the clan Munupi,” he said.
During last week’s hearings, a ranger told the court the project could threaten a vulnerable turtle species and kill the fish the islanders depend on.
Dina Hopstad Rui, the campaign manager for activist group Jubilee Australia, said it appeared “Santos has acknowledged that it is being cut”.
“Whether Santos presents a new pipeline proposal or not, the environmental movement will pass it line by line,” he said.
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The Barossa field is a joint venture between Santos, which is also the operator, and Korean energy company SK E&S.
US oil and gas group ConocoPhillips was previously part of the joint venture and led the project, but was sold to Santos in 2020.
ConocoPhillips had planned to build a spur line from the Barossa field to an existing pipeline to Darwin from another gas field in the Timor Sea, Bayu-Undan, which is nearly tapped.
However, when Santos took over the project, he decided to use an existing pipeline to pump carbon dioxide into the Bayu-Undan field as part of a carbon capture and storage project.
This means that to bring gas from the Barossa to Darwin, Santos must build a new pipeline alongside the southern part of the existing one.
About 100 km of the proposed gas pipeline are in NT waters and about 20 km in Commonwealth waters.
The company maintains approval for the overall Barossa project, which it won in 2018, but needs separate approvals for variations to the master plan, such as the pipeline and drilling.