With previous ruling thrown out, Barossa drilling again on the horizon

The Full Federal Court of Australia has dismissed the appeal from a decision brought in September that set aside NOPSEMA’s approval of the environment plan (EP) covering drilling activities for Santos’ Barossa gas field located offshore Australia.

In an attempt to block Santos from developing Barossa, Tiwi Islanders from the Northern Territory’s Tiwi Islands launched a legal challenge in June, claiming they had not been adequately consulted about the project, the pipeline of which will run through the Tiwi sea country.

With that, a decision by the federal offshore oil and gas regulator NOPSEMA to approve Santos’ plan to drill the Barossa gas field was challenged in court.

The Federal Court in Australia ruled against the energy giant and in favor of the Tiwi Islanders in mid-September, which resulted in drilling activities being suspended, pending a favorable appeal outcome or the approval of a new EP.

In an announcement from 2 December, Santos notes the new decision, saying it had consulted with Traditional Owners and their representative bodies on the Barossa gas project since 2016 and will continue to do so, taking into account the guidance provided by the court.

The company stated it had always sought to meet its consultation responsibilities and is continuing the process of revising the drilling EP to address the matters contained in the judgment and will now proceed with applications for all remaining approvals in accordance with the provided guidance.

Santos does not expect any material cost or schedule impact, with first gas from the project remaining on track to be delivered in the first half of 2025.

The Barossa gas field is located 300 kilometers offshore Darwin and it was planned to serve as the source of gas to backfill Darwin LNG when Bayu-Undan ceases production. It is operated by Santos with South Korea’s SK E&S and Japan’s JERA as partners.

Santos sanctioned the $3.6 billion gas and condensate project in March 2021, also kick-starting the $600 million investment in the Darwin LNG life extension and pipeline tie-in projects to extend the facility life for around 20 years.

In July, Santos was already preparing for drilling operations on the field with the Valaris-owned MS-1 semi-submersible rig, on contract until October 2023. However, the company in late August agreed to halt the drilling while the court makes its decision.