Last week (2 December), the gas giant lost its appeal to overturn the Federal Court’s decision that invalidated its permit for the construction of its Barossa gas project in the Timor Sea. 

This was the first-ever case in Australia where First Nations people challenged an offshore approval due to a lack of consultation, and the judgement found that Santos did not properly consult with Tiwi Island’s traditional landowners, the Munupi clan.

Munupi clan leader, Dennis Tipakalippa, led the legal challenge with assistance from the Environmental Defenders Office (EDO). He argued that NOPSEMA, the federal offshore gas regulator, should not have approved Santos’ drilling plans due to improper consultation with the Munupi clan. 

Santos’ appeal saw them argue that the traditional owners did not hold a legally defined interest in the sea area. The judgement, passed down by Justices Susan Kenny, Debra Mortimer and Michael Lee, dismissed Santos’ argument and the ruling against Santos was upheld.

“We consider that Santos was required by Reg 11A(1)(d) to consult Mr Tipakalippa and the Munupi clan because they had interests that may be affected by Santos’ proposed activities under the Drilling EP,” the judgement said. Santos was also ordered to pay Mr Tipakalippa’s costs.

Implications for other projects

The case is predicted to have significant implications for other offshore oil and gas projects, and more broadly, projects that involve the land or sea with which traditional owners are connected to and rely upon.

The standard of consultation with traditional owners has been lifted, EDO special counsel Alina Leikin told Lawyers Weekly. 

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The case “has enormous implications for projects all around Australia. Mining companies will now be required to meaningfully consult with First Nations people before they submit project approvals to the offshore regulator,” said Ms Leikin, who acted on the case.

Whilst the decision will not formally apply to onshore projects, it is to be expected that mining companies will be looking closely at the decision and thinking about how they’re consulting with First Nations people, Ms Leikin posited. 

The legal arguments that won the case 

In the case against Santos, “we were very focused on the concept of interests,” explained Ms Leikin.

“We argued that traditional owners have a very clear and direct interest in the sea country, which arises from millennia-old traditional connection to the sea, as well as reliance on marine resources.”

“The Full Federal Court, in a unanimous decision, agreed that traditional owners have a direct and immediate interest in the sea country,” she continued.

“That interest gives rise to the obligation for Santos to identify them as relevant stakeholders or relevant persons, and then to consult them in accordance with the regulations.”

Santos expects to proceed

Despite the ruling, Santos has stated that they will revise their drilling environment plan to address the issues clarified in the judgement, and continue to apply for approvals for the project in accordance with the court’s guidance, as was reported Upstream on Sunday (4 December).

The gas giant stated that it does not anticipate any material cost or impact on schedule, stating that gas from Barossa remains on track for 2025, with the majority of gas production to be exported to consumers in East Asia.

Mr Tipakalippa “has always said to us that they will fight this project from the beginning to the end,” Ms Leikin said.

They also believe that if Santos does meaningful consultation about the catastrophic risks to their way of life, and to the traditional and cultural practices and spiritual connections that they have protected for millennia — that if they fully understood this — they would not go ahead with the project, Ms Leikin told Lawyers Weekly. 

Fears for offshore wind farm approvals?

Not only are oil and gas companies fearing for their ability to secure permits, but the ruling has also caused trepidation for the government regarding the pursuit of other offshore projects, namely wind farms, the Australian Financial Review reported last Friday (2 December).

“The government acknowledges the Federal Court’s decision and will consider its implications in relation to Australia’s offshore environment and safety regulatory regime,” a spokeswoman for Resources Minister Madeleine King said.

The Labor government has also requested that NOPSEMA clarify its requirements for project developers when consulting traditional landowners.

Ms Leikin responded to the concerns supposed by the Australian Financial Review: “Our view is that every project that has the potential to impact on First Nations people, communities, and their country and spiritual connections must engage in meaningful consultation.”

The judgement arrives at a time when the Labor government is rallying support for the referendum for the Indigenous Voice to Parliament.

“The judgement is very much aligned with what the government is doing with the referendum,” Ms Leikin posited, “including First Nations people in all decisions that impact them. That’s what this case was fundamentally about.”

“This was a case about people having a say in what is most precious to them,” she added. 

“Our sea is like our mother,” Mr Tipakalippa said in the wake of the judgement, “we are part of the sea and the sea is part of us. 

“Santos and every other gas company must take note that this is our country and we must be consulted.”