‘Fundamental attack’: Gas services company ran cartel, court finds

An Australian oil and gas services company ran a cartel, trying to pull suppliers into illegal contracts, a court has found.

The boss of a Queensland oil and gas services company ran a cartel as he illegally tried to rig contracts, the Federal Court has found.

Qteq executive chairman Simon Ashton tried to pull suppliers into cartel arrangements five times between 2017 and 2019, the competition watchdog said on Thursday, citing an unreleased Federal Court decision.

“Cartels are the most fundamental attack on competition in our economy and taking actions against them is a high priority for the ACCC,” Australian Competition and Consumer Commission boss Gina Cass-Gottlieb said in a statement.

The case was filed as civil rather than criminal incidents.

The Queensland gas mining company tried to manipulate supply contracts. Picture: Getty Images

A Qteq spokesperson said the company would consider an appeal.

“We are continuing to review the judgment handed down by Justice Bromwich today and will assess the options open to us following that review,” the company spokesperson said in a statement.

“The opportunity for us to appeal the decision has been deferred pending the completion of a relief hearing.

“Whilst we are disappointed with this outcome, we continue to deliver first class products and exceptional service to our clients.”

Qteq has been granted extra time to consider an appeal. Picture: NewsWire / Gaye Gerard

The competition watchdog boss said the decision should send a message.

“Today’s decision should send a strong warning to all businesses and senior managers that attempting to enter or induce collusive agreements with a competitor is illegal and will be met with strong enforcement action by the ACCC,” Ms Cass-Gottlieb said.

Qteq is based in Queensland, providing mining equipment and technology services to oil and gas companies.

The ACCC says at the time of the cartel incidents, Qteq was the market leader in the pressure gauges which go down into coal seam gas drill holes to monitor water levels.

Fines for cartel behaviour were significantly increased in 2022. Picture: Getty Images

On five occasions, Qteq and Mr Ashton were found by the Federal Court to have tried to induce suppliers to enter contracts, arrangements or understandings to not to supply particular services to large oil and gas companies, to share markets and to rig a multimillion-dollar tender.

Under civil laws, individuals found to have made cartel actions face a maximum fine of $2.5m. Companies can be fined whichever amount is higher – $50m, three times the “reasonably attributable” value of the cartel actions, or 30 per cent of the corporation’s turnover during the offence period.

Qteq has offices in Brisbane, Townsville, Toowoomba and Roma.

A court date to assess orders against Qteq and Mr Ashton will be set at a later date. The Federal Court rejected the ACCC’s allegations related to one incident.

Originally published as ‘Fundamental attack’: Gas services company ran cartel, court finds