Australian Court Lets Santos Build Barossa Pipeline

Source: Santos
Source: Santos

Australia's Santos can proceed with construction of an undersea pipeline vital to its $4.3 billion Barossa gas project after a court on Monday ruled in favor of the oil and gas firm in a dispute with an Indigenous man looking to pause the work.

Work on the pipeline, which will connect the Barossa gas field to a processing plant in the northern Australian city of Darwin, was paused by court order in November after a suit by a member of an Indigenous group regarded as traditional land owners from the nearby Tiwi Islands.

Simon Munkara sought to halt work and force Santos to do a fresh assessment of the pipeline's impact on underwater cultural heritage. The applicants argued, among other things, that the pipeline would disturb the travels of, and anger, two "ancestral beings" - a rainbow serpent known as Ampiji and Jirakupai, or the Crocodile man.

However, Justice Natalie Charlesworth on Monday dismissed Munkara's application and lifted the November court injunction, opening the door for Santos to commence work on the pipeline.

Charlesworth said there was "significant division" among Tiwi Islanders over traditional accounts of Ampiji and Jirakupai and only a "negligible chance that there may be objects of archaeological value in the area of the pipeline route."

Santos shares traded up as much as 3.7% following the decision and then slipped to A$7.72, or 2.3% higher at 14:08 (0308 GMT).

Santos welcomed the decision in a statement and said it would continue pipelaying activity for the project.

The Environmental Defenders Office, which represented Munkara, did not immediately respond to Reuters when asked if it would appeal the decision. Santos did not immediately respond to a request for comment.

The decision clears a major hurdle blocking the long-stalled project and boosts the company's fortunes at a time when shareholders are calling for a meaty premium in a potential merger with larger rival Woodside Energy.

Citi analysts had said a ruling against Santos could delay the vital growth project, where the company aims to start producing gas in the first half of 2025, by more than a year.

Woodside and Santos announced preliminary talks in December on an A$80 billion ($53.53 billion) tie-up, although the holiday break means a deal is unlikely before February.

The Barossa project, which is co-owned by South Korean energy company SK E&S and Japan's JERA, still needs several environmental plans approved to proceed. A revised drilling plan was approved by the petroleum regulator in December.

(Reuters - Reporting by Lewis Jackson in Sydney; Editing by Sonali Paul and Christopher Cushing)

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