Gas giant Santos will pay just under $20,000 in penalties for its role in an oil spill off Western Australia’s Pilbara coastline.
About 25,000 litres of oil condensate was released into the Indian Ocean when one of the company’s flexible oil pipelines ruptured off the Pilbara coast in March 2022.
At a hearing in Karratha on Monday, Magistrate Robert Young found the company breached the WA Petroleum (Submerged Lands) Act 1982, handing Santos a $10,000 fine and ordering it to pay court costs of $9,700.
It is the first time a company has been fined under section 97(4) of the act, which states licensees “shall prevent the waste or escape of petroleum” and carries a maximum penalty of $50,000 for corporations.
The charges were brought by WA’s Department of Energy, Mines, Industry Regulation and Safety (DEMIRS), who alleged Santos allowed a flexible oil pipeline to repeatedly “bend and kink over”, eventually causing the rupture on March 19.
DEMIRS prosecutor Jeremy Johnston said the section of the pipeline was nearing the end of its life and was close to five years old at the time.
He said Santos failed to properly investigate the pipeline for any potential damage and that punishment was needed to deter other companies from similar negligence.
Santos gave the court an endorsed guilty plea prior to Monday’s appearance and agreed the company had failed to adequately ensure the pipeline was safe for use.
Santos’s lawyer Liam Nicholls told the court that the company had conducted its own internal investigation, commissioned an independent inquiry and continued to work directly with the regulator.
He said the working life spans of pipelines were also amended, reducing them to three years, instead of five.
Mr Nicholls told the court Santos “takes its statutory obligations seriously” and expressed remorse on behalf of the company.
In his decision, Magistrate Young said any punishment needed to reflect the seriousness of the allegations.
“There can be no message conveyed that it is more effective to absorb fines as the cost of doing business,” he said.
However, he said the actions taken by Santos had given “serious attention” to the infringement and had set up a “robust set of safeguards”.
Magistrate Young noted that “no allegation of environmental damage” was brought to the court’s attention and said the spill was “relatively limited”.
‘Limited’ environmental impact
Lawyers for both the state and Santos told the court there was no serious environmental impact because of the spill.
Mr Nicholls said aerial and water surveys revealed 95 per cent of the condensate evaporated within 24 hours of the spill and the remainder evaporated over the next few days.
Whistleblower testimony tabled in federal parliament in early 2023 claimed the spill caused the deaths of dolphins and other marine life.
The testimony, tabled by independent Senator David Pocock, also claimed Santos had covered up the impact of the spill.
Santos has continually denied the claims and a report at the time found the environmental impact to be “negligible”.
In a statement provided to the ABC, a Santos spokesperson said the company “deeply regrets the spill” and that previous surveys on the line revealed “no damage or deterioration”.
The spokesperson confirmed the line had been “maintained in accordance with the prescribed service life of the line”.
DEMIRS resource and environmental compliance executive director Tyler Sujdovic said enforcing compliance was a key priority of the department.
“Operating subsea pipelines in a ‘proper and workmanlike manner’ is a fundamental principle widely understood and applied by operators in the oil and gas industry,” he said.
“Companies must ensure all workers, including contractors, have the required training and access to up-to-date written procedures to manage petroleum effectively.”
Mr Sudjovic said the department would continue to ensure petroleum activities were undertaken in a safe way.
Fine ‘completely inadequate’
The Conservation Council of WA has labelled the fine as “inadequate” and warned it would do little to prevent further cases.
The council’s fossil fuels programs manager Anna Champan said the costs would not be “enough to deter oil spill”.
“That’s less than 40 cents per litre of oil spilled,” she said.
“So the fine is completely inadequate.”
