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AAP
AAP
Jacob Shteyman

Santos ploughs ahead with Barossa despite drilling ban

Santos still plans to open its Barossa gas project on schedule and within budget. (David Clark/AAP PHOTOS)

Santos is pushing ahead with its contentious Barossa gas megaproject despite a court injunction banning the fossil fuel giant from drilling at the site.

A group of Tiwi Islands traditional owners won a Federal Court bid last year to throw out a drilling approval at the multimillion-dollar gas field 265km northwest of Darwin.

But in its September quarter update on Thursday Santos maintained it was on track to open Barossa on schedule and within cost guidance, with 68 per cent of the project completed.

Santos pushing ahead with Barossa project
Santos is pushing ahead with its contentious Barossa gas megaproject despite a court injunction.

Despite awaiting approvals, the company revealed its plans to begin installing underwater gas pipelines this year after an independent expert concluded there were no specific "underwater cultural heritage places" along the route.

The Tiwi community rejected this, saying they had been sideswiped by Santos' announcement it would begin laying the pipeline 6km off the coastline "right over the top of ancestral burial grounds".

"The water may have risen and moved over time, but it has never interrupted our spiritual connection to the land that is now underwater," Munupi senior cultural leader and elder Pirrawayingi Puruntatameri said.

"Regardless of who it is, we will stand up to protect our human rights to this sea country where our ancestors are buried.

"That is our most important and strongest ties to the spirit world that non-Indigenous people may not understand."

Tiwi campaign leader and human rights advocate Antonia Burke said Santos needed to be stopped.

"Santos are trampling on our human rights. No one should be investing in or supporting this destructive project." traditional owner Therese Wokay Bourke added.

Pirrawayingi Puruntatameri
Pirrawayingi Puruntatameri said the Tiwi community had been sideswiped by Santos' announcement.

Santos' announcement came despite no indication when drilling operations will be allowed to restart, with the company reportedly paying $US350 million ($A552 million) over the past year for a drill rig to sit idle off the coast of Darwin.

"Investors will be questioning Santos on how it can lose a year in the drilling schedule and still be on track," Brynn O'Brien, executive director at the Australasian Centre for Corporate Responsibility, said.

"And what gives Santos confidence that drilling will recommence this year, despite the drilling rig reportedly being needed for a separate contractual obligation?"

RBC Capital Markets analyst Gordon Ramsay said Barossa will not meet its startup target of early 2025 unless drilling re-commences and the gas export pipeline is installed before the end of 2023.

"Delivering Barossa on time and budget is becoming more of a stretch target as we get close to year-end," he said.

Santos reports quarterly sales revenue
Santos reported sales revenue of $US1.4 billion ($A2.2 billion) for the quarter.

Santos reported sales revenue of $US1.4 billion ($A2.2 billion) for the quarter.

"Santos' other major project developments - Pikka oil, Moomba CCS and Papua LNG - appear to be progressing well," Mr Ramsay said.

An increase in crude oil output at Santos' Papua New Guinean operations lifted production slightly higher than the previous quarter to 23.3 million barrels of oil equivalent.

Santos expects the first oil at its Alaskan Pikka fields in 2026 with an initial production rate of 80,000 barrels per day.

"Free cash flow of $US1.6 billion ($A2.5 billion) year-to-date positions the company well to deliver shareholder returns, backfill and sustain our existing business, while also investing in our major projects and progressing our decarbonisation plans," Santos CEO Kevin Gallagher said.

The results came ahead of news Santos is being taken to the Federal Court by Australia's energy regulator for allegedly breaching its record-keeping obligations at day-ahead auctions.

Santos said it was "disappointed" the proceedings had been brought against it and maintained the alleged breaches had no impact on supply or price in the east coast domestic gas market.

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