New green challenge to Santos’ Narrabri gas project
The controversial Narrabri gas project being built in the north west of NSW faces a fresh legal challenge from environmentalists.
The controversial Narrabri gas project being built by Santos in the north west of NSW faces a fresh hurdle, with an appeal launched against the Independent Planning Commission’s approval of the development, just days after Woodside Petroleum was hit with its own legal challenge.
Judicial review proceedings have been lodged in the NSW Land and Environment Court by community group Mullaley Gas and Pipeline Accord, represented by the Environmental Defenders Office.
The case says the IPC failed to consider the environmental impact of a gas pipeline which has yet to be approved and did not properly consider Narrabri emissions and their impact on climate change.
“Our client will therefore ask the court to find that the approval for the Narrabri Gas Project is invalid,” EDO director of legal strategy Elaine Johnson said on Wednesday.
Santos won approval for Narrabri from the IPC on October 1 and is now undertaking a 12-18 month appraisal program to assess gas resources at the project, touted as providing half the state‘s gas needs.
“Santos respects the law of the land and it would therefore be inappropriate for us to comment on a matter that is before the courts,” a Santos spokesman said.
Among the concerns raised by critics of the proposed gas project was the potential for the Gunnedah Basin and surrounding aquifers to be poisoned due to underground drilling, putting in danger both local farms and the region’s agricultural products.
Activist group Lock The Gate Alliance said the Gomeroi Traditional Owners fighting the Narrabri coal seam gas field would ramp up the battle to protect their lands and water resources following the IPC decision.
The South Australian energy producer has now received both federal and state approvals for Narrabri and has started a two-year appraisal process costing $US90m ($122m), drilling 10 gas wells ahead of a final investment decision in the first half of 2023.
It would then move to a $US650m first phase development spread over three years, reflecting a staged investment plan and less than a third of the original $3.6bn capital cost previously slated for the overall project.
Before it gives Narrabri the green light, Santos said it wanted to appraise the supplies before it officially records gas on a proven and probable basis, known as 2P reserves in the industry.
Santos chief executive Kevin Gallagher said it the company learnt lessons from its GLNG project in Queensland, which has endured issues over its reserves position. Gas is now expected to start flowing from Narrabri in the first half of 2025.
The legal stoush is the second major challenge to a gas project launched in Australia this week after the Conservation Council of Western Australia started a case against Woodside Petroleum’s Burrup Hub plans in the Supreme Court on Monday.
Woodside plans to send gas from the $16bn Scarborough project offshore WA to expand its Pluto LNG plant and develop the giant Browse gas field to help fill the NW Shelf facility.
The Conservation Council, also represented by the EDO, alleges WA government approvals were given in contravention of the Environmental Protection Act, which requires Environmental Impact Assessment for any developments that would have a significant impact on the environment.
Woodside on Monday said it planned to “vigorously defend” its position.
NSW Deputy Premier John Barilaro announced plans in November for a new Narrabri manufacturing precinct, creating 1500 jobs, and echoing elements of the Morrison government’s gas-led recovery plans for the east coast.
Multinational Perdaman, Australia’s largest brickmaker Brickworks and retailer Weston Energy which supplies gas to big users in the state have already indicated plans for $2bn of investment should Narrabri proceed.
NSW Premier Gladys Berejiklian has indicated the state will tap LNG imports if Narrabri fails to move ahead, to meet a federal government deal to supply an extra 70 petajoules of gas into the east coast domestic market.
Still, with no drilling at Narrabri undertaken in the last six years, analysts said there would be intense interest in the appraisal phase.
Disruptive protests and separate environmental approvals for a new $500m pipeline planned by APA Group to transport Narrabri gas to customers also loom as potential hurdles.
Santos in September accepted 134 conditions imposed on the project by the NSW Independent Planning Commission with strict conditions on clearing limits and rehabilitation of rural land.
Attention will now turn to the cost and timing of gas supplies, with critics of Narrabri questioning whether it will reduce prices.
Narrabri gas will need to be sold for $8 to $10 a gigajoule to achieve a return on investment assuming well performance as well as capital and operating costs similar to Queensland coal seam gas fields, JP Morgan said.
More Coverage
