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Barossa Gas Project

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Barossa Gas Field
CountryAustralia
RegionDarwin
Coordinates-9.725, 130.482
OperatorSantos Limited

The Barossa Gas Project is an offshore gas and condensate oil field under construction by Santos Limited in Australian waters in the Timor Sea around 300 km (190 mi) north of Darwin in the Northern Territory.[1] Upon completion in late 2025, it is estimated to be the most carbon-intensive gas development in Australia.[2]

The project is intended to supply the Darwin LNG facility (DLNG) at Wickham Point, Middle Arm near Darwin, only the second facility of its kind in Australia. The Barossa Gas Project will replace the supply from the Bayu-Undan field since reserves were depleted in 2023.[3] This requires construction of a new 262 km pipeline, known as the Darwin Pipeline Duplication Project, which, for part of its length, runs parallel to the existing Bayu-Undan to Darwin Pipeline.[4][5] The gas will then be liquified at the DLNG and then exported.[6]

The project was initially accepted by the Commonwealth Government's independent regulator for offshore oil and gas development, the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) in March 2018.[7] Santos bought ConocoPhillips' interest in the project in 2019.[8] The pipeline was approved in March 2024 and is currently around 67% completed.[9][10]

Worth at least A$4.7 billion, the project is expected to create around 600 jobs during construction and 350 ongoing jobs in Darwin over the following 20 years.[11]

Emissions and environmental impact

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The Barossa Gas Project is approximately 33 km from the Oceanic Shoals Australian Marine Park.[12] Three other federal government marine parks, including Ashmore Reef, are also in the vicinity. The project's pipeline runs through the traditional Sea Country the Larrakia and Jikilaruwu Tiwi Islands clan, who have significant cultural connection to it as well a dependency on it as a habitat for many marine species. They are particularly concerned about impact to the nesting areas of flatback and olive ridley turtles.[13]

The project has been called a 'carbon bomb' due to its excessive future carbon emissions that will make it the most carbon-intensive gas development in Australia upon completion.[2][14][15] The project is estimated to produce as much as 1.5 tonnes of CO2 for every tonne of LNG, leading the Institute for Energy Economics and Financial Analysis (IEEFA) to describe the project as an “emissions factory with a gas by-product”.[16][17] A 2021 report suggested that emissions could be greatly reduced by the use of solar power by using Sun Cable's troubled Australia-Asia Power Link and/or carbon capture and storage (CCS), but the IEEFA found the project would continue to release financially risky carbon dioxide emissions at the site, onshore and across the whole supply chain.[2][18]

In March 2023 the project was significantly impacted by the Australian Government's reform of its Safeguard Mechanism, a key part of its climate policy. The mechanism requires Australia's biggest greenhouse gas emitters to keep their direct emissions below a prescribed baseline limit by either reducing or offsetting emissions.[19] This would add estimated additional costs to the Barossa Gas Project of between A$500 million and A$987 million between now and 2030.[20] Santos CEO Kevin Gallagher strongly opposed the changes to the Safeguard Mechanism claiming it would make the project unviable, directly lobbying the government to enable them to use carbon capture and storage to offset emissions. This would involve separating out the carbon dioxide from the gas at the Darwin LNG facility and piping it back to the Bayu-Undan field to be stored under the sea floor, essentially exporting it, as the field is in Timorese waters.[21] Despite never having completed a similar project and known limitations to CCS technology at that scale, the Labor Government quickly passed the Environment Protection (Sea Dumping) Amendment (Using New Technologies to Fight Climate Change Bill, enabling the project to proceed, while leading opponents to call it 'the Santos Amendment'.[22][23]

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South Korean banks case

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In March 2022, leaders of the Larrakia and Jikilaruwu Tiwi Islands clan, the traditional owners of the sea country through which the pipeline will pass, launched a legal challenge that attempted to stop the South Korean state-owned Export-Import Bank of Korea (KEXIM) and the Korea Trade Group (K-Sure) from providing loans and guarantees of up to A$700 million for the project, thus preventing Santos from building the gas pipeline near Cape Fourcroy.[24] However the case failed in the Seoul District Court.[25][26]

Tipakalippa case

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In June 2022, traditional owners of the Tiwi Islands filed a lawsuit supported by the Environmental Defenders Office (EDO) against Santos and the federal government, who they said had not properly consulted them. This was the first case in Australia challenging an offshore project approval because of lack of consultation with First Nations people.[27] Munupi Senior Lawman and Tiwi Traditional Owner Dennis Tipakalippa argued that NOPSEMA, the federal offshore gas regulator, should not have approved Santos’ plans to drill the Barossa gas field due to the Santos' inadequate consultation.[28] Concerned about the cultural and environmental impact of the project on traditional food sources, Santos has submitted an environmental impact plan, which includes the potential impact of an oil spill, and its plans for cleanup should one occur.[11]

In September 2022 Judge Mordecai Bromberg found that NOPSEMA was "not lawfully satisfied that consultation had occurred", dismissing Santos’ environmental plan, thus invalidating its approvals for drilling. As a result, Santos had to disconnect its drilling rig from the sea north of Melville Island and leave the Barossa field by 6 October 2022.[29]

In December Santos lost an appeal.[30][31] NOPSEMA ordered Santos to stop construction on their pipeline to enable a cultural heritage survey to be done.[32] Traditional owners then lodged human rights complaints against 12 banks including ANZ, Commonwealth Bank, Westpac, and NAB, over their involvement in the Barossa Gas Project again claiming a lack of consultation.[33]

In May 2023, Resources Minister Madeleine King announced a review into offshore gas consultation requirements. In March 2024 a bill was introduced enabling the minister broader power to amend legislation or regulations without reference to national environmental standards, which was criticised for potentially threatening First Nations consultation rights that enabled the Tippakalippa case.[34][35]

Munkara case

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In October 2023, a group of 11 Tiwi traditional owners led by Simon Munkara of the Jikilaruwu clan, applied for an urgent injunction in the Federal Court of Australia to prevent Santos commencing work on the Barossa gas pipeline, claiming Santos has not properly assessed the underwater cultural heritage of the region. Santos claimed the applicant was motivated by environmental ideals rather than genuine risk to cultural heritage, citing disagreements concerning the validity and relevance of the traditional Dreaming or songlines pertaining to the area, the Crocodile Man and Ampiji in particular.[36][37][38]

On 15 January 2024, the judge dismissed the case enabling Santos to resume laying its underwater pipeline. In her judgement, Justice Natalie Charlesworth stated their lawyers had engaged in manipulations and "a form of subtle witness coaching" requiring the applicants to pay Santos' legal costs. A review in May 2024 found the EDO did not breach the terms of a $8.2 million grant agreement between it and the federal government and there was "no evidence indicating potential fraud".[39]

In April 2024, despite no direct involvement in any of the legal cases, Sunrise, Jubilee Australia and the NT Environment Centre were ordered to hand over documents to determine whether Santos will also pursue costs for the lawsuit carried out by the EDO on behalf of Tiwi Island traditional owners. This has been critiqued by human rights groups as potentially setting a precedent that the expression of support for fellow civil society groups and First Nations people involved in litigation might enable a fossil fuel company access to internal documents and open the risks of a claim of legal costs.[40]

References

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  1. ^ Richardson, Nathan (30 March 2021). "Australia's Santos takes FID on Darwin LNG Barossa backfill project". S&P Global Commodity Insights. Retrieved 7 June 2022.
  2. ^ a b c Vorrath, Sophie (16 November 2021). "Gas industry proposes big solar to halve LNG emissions, with support of Sun Cable". RenewEconomy. Archived from the original on 17 November 2021.
  3. ^ "Australia's only helium plant shuts down after gas supply for Darwin plant runs out". ABC News. 2023-12-05. Retrieved 2024-05-20.
  4. ^ "Darwin Pipeline Duplication (DPD) Project NT EPA Referral" (PDF). Northern Territory Environment Protection Authority (NT EPA). Retrieved 2021-12-08.
  5. ^ Redman, Chris (2024-03-28). "Government approves Santos Barossa pipeline and sea dumping". The Australia Institute. Retrieved 2024-05-20.
  6. ^ "'Carbon bomb' or economic lifeline? A massive new Australian gas project just got the green light". ABC News. 2021-03-30. Retrieved 2024-05-21.
  7. ^ "Activity - Barossa Gas Export Pipeline Installation". National Offshore Petroleum Safety and Environmental Management Authority. Retrieved 2024-05-20.
  8. ^ "ConocoPhillips Announces Agreement to Sell Interests in Australia-West for $1.39 Billion". ConocoPhillips. 2019-10-13. Retrieved 2024-05-20.
  9. ^ "Barossa project progressing offshore Australia". Offshore. 2024-02-21. Retrieved 2024-05-20.
  10. ^ Redman, Chris (2024-03-28). "Government approves Santos Barossa pipeline and sea dumping". The Australia Institute. Retrieved 2024-05-21.
  11. ^ a b Bardon, Jane (7 June 2022). "Tiwi traditional owners launch Federal Court action to try to stop Santos Barossa gas field". ABC News. Australian Broadcasting Corporation. Retrieved 7 June 2022.
  12. ^ "Industry environment plans". info.nopsema.gov.au. Retrieved 2024-05-20.
  13. ^ "Traditional owners vow to keep fighting billion-dollar gas project despite losing court battle". ABC News. 2022-05-25. Retrieved 2024-05-21.
  14. ^ "Sea dumping legislation paves way for opening of new gas fields in Timor Sea". ABC News. 2023-11-14. Retrieved 2024-05-17.
  15. ^ "Santos' Barossa project is a carbon bomb". ACCR. 2021-03-30. Retrieved 2024-05-21.
  16. ^ "'A carbon dioxide emissions factory': New $4.7b gas field may release more CO2 than LNG, says report". ABC News. 2021-06-23. Retrieved 2021-08-13.
  17. ^ "Santos back to the drawing board on unapproved Barossa gas project". ieefa.org. Retrieved 2024-05-17.
  18. ^ "IEEFA Update: Santos won't solve the problem of Barossa LNG with carbon capture and storage". Institute for Energy Economics & Financial Analysis. 20 October 2021. Archived from the original on 23 October 2021.
  19. ^ Patrick, Rex (2023-12-09). "Carbon Captured: Santos emails reveal gas giant orchestrated "Environment Protection" laws". Michael West. Retrieved 2024-05-20.
  20. ^ "The New Safeguard Mechanism and the Santos Barossa Gas Project". The Australia Institute. 2023-05-17. Retrieved 2024-05-20.
  21. ^ "Will Santos's $4.7 billion Barossa gas project go ahead?". ABC News. 2023-03-30. Retrieved 2024-05-20.
  22. ^ Davies, Luciana Lawe (2023-11-13). "Government's 'dirty favour for Santos' bill passes with opposition support". The Australia Institute. Retrieved 2024-05-20.
  23. ^ Patrick, Rex (2023-12-09). "Carbon Captured: Santos emails reveal gas giant orchestrated "Environment Protection" laws". Michael West. Retrieved 2024-05-20.
  24. ^ "South Korea sued to stop deep-sea gas pipeline". BBC News. 23 March 2022.
  25. ^ Bardon, Jane (25 May 2022). "Traditional owners vow to keep fighting Barossa gas field despite losing South Korean court battle". ABC News. Australian Broadcasting Corporation. Retrieved 7 June 2022.
  26. ^ "Traditional owners vow to keep fighting billion-dollar gas project despite losing court battle". ABC News. 2022-05-25. Retrieved 2024-05-17.
  27. ^ "NT Traditional Owner sues Santos and the Federal Government over offshore drilling plans". Environmental Defenders Office. Retrieved 2024-05-21.
  28. ^ "Tiwi Traditional Owner wins legal challenge to Santos Barossa Gas Project". Environmental Defenders Office. 21 September 2022. Retrieved 2022-09-21.
  29. ^ Nadig, Smruthi (21 September 2022). "Santos Australia loses environmental protection case in Tiwi Islands". Offshore Technology. Retrieved 2022-09-21.
  30. ^ "Dennis Murphy Tipakalippa v National Offshore Petroleum Safety and Environmental Management Authority & Anor". Climate Change Litigation. Retrieved 2024-05-17.
  31. ^ "Santos has lost a major gas battle against Tiwi Islands' traditional owners. Here's why they hope Barossa will still go ahead". ABC News. 2022-12-03. Retrieved 2024-05-17.
  32. ^ "Santos ordered to pause construction on $5.6b Barossa project, hours before works due to start". ABC News. 2023-11-02. Retrieved 2024-05-22.
  33. ^ "Tiwi Islands traditional owners lodge human rights complaint against banks over $1.5b Santos loan". ABC News. 2023-04-04. Retrieved 2024-05-21.
  34. ^ "Offshore gas probe to tackle project logjam fears". Australian Financial Review. 2023-05-31. Retrieved 2024-05-24.
  35. ^ Karp, Paul; correspondent, Paul Karp Chief political (2024-03-14). "David Pocock fears Labor trying to work around First Nations consultation on offshore gas projects". The Guardian. ISSN 0261-3077. Retrieved 2024-05-24. {{cite news}}: |last2= has generic name (help)
  36. ^ "Santos wins legal battle against Tiwi Islands elders over $5.7b Barossa gas pipeline". ABC News. 2024-01-15. Retrieved 2024-05-21.
  37. ^ "Australian and Pacific Climate Change Litigation". law.app.unimelb.edu.au. Retrieved 2024-05-22.
  38. ^ "Santos lawyers accuse traditional owners of altering dreaming stories to block gas pipeline". ABC News. 2023-12-07. Retrieved 2024-05-22.
  39. ^ "Environmental Defenders Office did not breach $8.2m grant agreement over NT gas case, review finds". ABC News. 2024-05-18. Retrieved 2024-05-21.
  40. ^ Kurmelovs, Royce; Cox, Lisa (2024-04-25). "Activist groups not directly involved in Tiwi Island lawsuit must hand over documents to Santos, court rules". The Guardian. ISSN 0261-3077. Retrieved 2024-05-17.
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