‘Deep regret’: Santos hit with $10k fine over Pilbara oil spill

Energy giant Santos has been hit with a $10,000 fine over an oil spill at its processing facility off Western Australia’s north-west after being dragged to court by the state’s workplace regulator.

The $22 billion ASX-listed company fronted Karratha Magistrates Court on Monday, pleading guilty to failing to prevent the spill as required under the Petroleum Act over the 2022 incident which was first revealed by WAtoday.

Santos supplies about one-fifth of WA’s gas needs through Varanus Island.Credit:

On March 20, 2022, a flexible pipeline on the seabed which Santos used to load a tanker moored off its facility at Varanus Island ruptured, releasing 25,000 litres of condensate.

Loading was halted shortly after dawn when condensate was observed on the ocean surface near the facility, which supplies about one-fifth of the state’s gas.

The Department of Energy Mines, Industry Regulation and Safety pursued charges in November 2024 after concluding the pipeline licensee had failed on multiple fronts, including by not sufficiently monitoring condensate loading and ensuring the infrastructure was fit for purpose.

The company was ordered to strengthen its operational controls and overhaul its environmental plan in the wake of the spill.

The rupture is believed to have been caused by repeated kinking of the flexible loading line, which compromised its integrity.

In a statement released shortly after the verdict was handed down, DEMIRS environmental compliance executive director Tyler Sujdovic said the department would continue to ensure companies observe all regulations and adopt best practice.

“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,” Sujdovic said.

“The objective is to ensure pipelines are operated safely, reliably, and professionally.

“Companies must ensure all workers, including contractors, have the required training and access to up-to-date written procedures to manage petroleum effectively when performing their assigned tasks.”

Santos has also been ordered to fork out $9700 in court costs.

Following the ruling, a Santos spokesperson insisted the company took its environmental responsibilities seriously and expressed deep regret over the incident.

“Santos takes its environmental and regulatory compliance responsibilities very seriously, and deeply regrets the spill which occurred at the Varanus Island Marine Terminal after a flexible tanker loading line (line) used for offtake operations ruptured,” the spokesperson said.

“The incident occurred about two months before that part of the line was scheduled to be replaced, and it had been maintained in accordance with the prescribed service life of the line.

“Prior to the rupture, regular surveys showed no damage or deformation of that part of the line.”

The Conservation Council of WA came out swinging over the ruling, branding the fine “completely inadequate”.

The incident was initially linked to the deaths of marine life, with photographs of a dolphin floating belly-up within 200 metres of the spill tabled by Senator David Pocock in parliament in 2023.

CCWA fossil fuels program manager Anna Chapman said the incident served as another example of the oil and gas industry getting away with trashing the environment for ‘the lowest possible price’.

“At less than 40 cents per litre of oil spilled, the fine issued to Santos today is completely inadequate given the scale of the fatal environmental vandalism they caused,” Chapman said.

“In WA, multinational gas companies pay less for pumping oil into the ocean than average West Australians pay to put petrol in their cars.

“Far from negligible, this oil spill was gross negligence from the gas industry with catastrophic and deadly impacts for WA’s precious and threatened marine life.”

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