Santos’s $5.8bn Barossa offshore gas project has taken another step forward after the federal court dismissed a legal challenge by a group of Tiwi Islanders to the construction of a pipeline.

In a decision on Monday, Justice Natalie Charlesworth dismissed the legal action and lifted a temporary injunction that had prevented Santos from beginning construction work in an area on the pipeline route.

The judgment means Santos can push ahead with constructing the pipeline.

It follows the December decision by the petroleum regulator the National Offshore Petroleum Safety and Environmental Management Authority to approve the drilling program for the project.

An earlier drilling permit was overturned after a separate federal court case found Santos had not properly consulted Tiwi traditional owners about the proposed drilling.

Three Tiwi traditional owners, led by Simon Munkara, a member of the Jikilaruwu clan, and represented by the Environmental Defenders Office, launched the case against the pipeline last year.

They claimed Santos had not properly assessed submerged cultural heritage along the route of its Barossa export pipeline, which runs within 7km of Cape Fourcroy on Bathurst Island.

The case sought an injunction on pipeline works until Santos submitted a new environmental plan and it was assessed by Nopsema.

Charlesworth found that evidence from witnesses for the three applicants asserting the pipeline posed a risk to intangible underwater heritage, including Crocodile Man songlines and an area of significance for the rainbow serpent Ampiji, was not “broadly representative” of the beliefs of Tiwi people who would be affected by the pipeline.

Charlesworth also dismissed evidence provided in an expert report about potential impacts to underwater archaeological sites, finding there was a “negligible chance” of a significant impact to tangible cultural heritage.

In a statement to the ASX, Santos welcomed the court’s decision.

“As per the ruling and in accordance with the Environment Plan in force for the activity, Santos will continue pipe-laying activity for the Barossa Gas Project,” the company said.

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Munkara said the outcome was very disappointing.

“We brought this case to protect our sea country. I am a true believer for my country,” he said.

“We are hurting and need some time to think.”

Alex Hillman, lead analyst at the shareholder activist organisation the Australasian Centre for Corporate Responsibility (ACCR), said while the ruling cleared the way for work on the pipeline to restart, it had left “a colossal haemorrhage of shareholder money in its wake”.

“We estimate that Santos’ regulatory delays could have cost the Barossa project $800m,” he said.

“It remains to be seen whether the decision today addresses mounting investor concerns about Santos’ share price and the optimal structure for maximising shareholder value.”

Last week the federal government released a discussion paper about regulations governing consultation for offshore petroleum projects.



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