Federal Court judgement exposes glaring gap in fossil fuel clean up laws leaving taxpayers and marine life vulnerable

The Federal Court has today found that Australia's offshore oil and gas regulator, NOPSEMA, was not legally required to be satisfied that Santos had the financial capacity to clean up its ageing Reindeer gas field. The decision concerned NOPSEMA's acceptance of Santos' Environment Plan on 8 May 2025 for the non-producing Reindeer offshore field off Karratha, Western Australia. 

The Wilderness Society, who brought the case against NOPSEMA and Santos, says the outcome of this litigation exposes an alarming deficiency in Australian oil and gas laws, leaving taxpayers and the marine environment exposed to the risk of fossil fuel corporations being unable or unwilling to fund the clean up of their projects at the end of operations.

Fern Cadman, Fossil Fuel Industry Campaign Manager for the Wilderness Society, said, “Today’s decision sends a stark message about our broken oil and gas laws. It's gobsmacking that oil and gas companies can install massive offshore industrial infrastructure without first proving they have the funds set aside to clean it up.”

“This creates a major risk that the marine environment will be left to carry a toxic legacy, while taxpayers ultimately risk footing the estimated $60 billion offshore oil and gas clean up bill bearing down on Australia.”

The gravity of today’s decision is put into perspective by the high profile insolvencies last month of two oil and gas companies off the coast of Dongara, WA, leaving behind an estimated $200 million clean up bill without an owner capable of paying. 

These recent examples follow the notorious Northern Endeavour insolvency, which left the Australian Government coordinating a multi-billion dollar clean up task for a field previously owned by Woodside. 

Ms Cadman says “Oil and gas companies have exploited Australia’s resources for decades, making enormous profits, paying minimal tax, and doing untold damage to the marine environment and the climate. 

“Without assurances that they will clean up the industrial legacy of toxic infrastructure they’ve spent decades proliferating throughout Australia’s beautiful oceans, we are concerned that taxpayers and the marine environment will be exposed to environmental and economic risk.”

In light of today’s decision and the recent Pilot and Triangle insolvencies, the Wilderness Society is calling on the Federal government to urgently reform Australia’s offshore petroleum laws to ensure the fossil fuel industry’s global pattern of cutting and running from clean up responsibilities can’t continue to repeat in Australia. 

“The Albanese Labor government must act to close this glaring omission in our petroleum laws by legislating rock solid requirements for end of life clean up. Oil and gas corporations must be required to pay upfront clean-up bonds before they are allowed anywhere near the exploitation of Australian oceans for profit.”

“Renters have to pay bonds before they move in, not when they give notice to leave. Workers set aside funds for retirement during employment, not on the brink of it ending. It’s well past time for Australian law to unequivocally require oil and gas money to clean up after themselves, with funds secured ahead of time.” 

David Hertzberg, Principal Lawyer at Equity Generation Lawyers, said:

“Today’s decision addresses an important aspect of Australia’s offshore petroleum law - the extent to which NOPSEMA needs to be satisfied that operators have financial assurance for decommissioning costs. 

“We will carefully consider the Court’s reasons for its decision. Our client remains concerned that, without a robust financial assurance framework, there is a real risk that companies will not be able to meet obligations to remove infrastructure and rehabilitate the marine environment.”

The full judgement is available here.

For interviews with Fern Cadman, Fossil Fuel Industry Campaigner for the Wilderness Society, please contact Rhiannon Cunningham, media adviser for the Wilderness Society on [email protected] or 0419 992 760