Australian gas giant Santos has been ordered to pay historic fines for its role in a major oil spill off Western Australia's Pilbara coastline in 2022.
The $22 billion ASX-listed company faced Karratha Magistrates Court on Monday which found the company breached WA’s Petroleum (Submerged Lands) Act 1982, handing Santos a $10,000 fine and ordering court payments of $9,700.
This 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.
On 20 March 2022, around 25,000 litres of condensate escaped from a rupture in the flexible part of a pipeline that conveyed petroleum condensate to offshore shipping tankers.
The court found that Santos’ failures as the pipeline licensee included insufficient monitoring of condensate loading operations, as well as failing to conduct an adequate investigation of the pipeline’s fitness for purpose prior to its use in 2022.
As a result, the Department of Energy, Mines, Industry Regulation and Safety (DEMIRS) required Santos to strengthen its operational controls by amending the company’s environment plan to reduce the risk of future incidents.
Santos has since reviewed practices and implemented measures to prevent the kinking of loading lines along with subsea monitoring of line positions.
In a statement DEMIRS Executive Director of Resource and Environmental Compliance Tyler Sujdovic said the department would continue to enforce compliance to ensure companies observe all regulations and adopt best practice.
“The department is committed to ensuring petroleum activities are conducted in an environmentally safe and responsible manner,” Sujdovic said.
“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.”
At the time of writing, Santos Ltd (ASX: STO) has a share price of A$6.86. The share price saw a slight decrease of 0.02 (or -0.29%). The market capitalisation is approximately $22.34 billion.
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