Serious incidents explode Santos’ claims of safe operator

News of the purchase of the Queensland Hunter Gas Pipeline (QHGP) by Santos for an undisclosed amount has put the gas producer’s safety record under scrutiny. Santos’ safety culture has been repeatedly questioned,  the most recent serious incident occurring on 5th July when dismantling a Santos oil rig off Varanus Island on the Western Australian coast. Australian Workers’ Union National Secretary Daniel Walton described the incident as one of the “most horrifically scary accidents” the union has ever seen in the WA resources industry. He told 9 NEWS “It seems to be a race to the bottom, that is, try to cut costs in every way you possibly can to save a buck or two”. 

A major pipeline fire which occurred on 1st July 2019 near Innamincka, South Australia, could be a taste of the future for up to 3,000 landowners on the 833 kilometre QHGP route which traverses agricultural, forested and floodplain land from near Hexham, New South Wales, to Wallumbilla, Queensland where it is expected to connect with pipelines taking gas for export via the Gladstone LNG terminal.

Map of Santos’ Toolachee pipeline fire location excerpted from the FOI document

News of the Toolachee pipeline explosion was first circulated on the Facebook page of the South Australia Police soon after the serious incident which caused the remote Strzelecki Track to be closed for several days. Toolachee satellite gas processing facility is situated within PPL 14 in the Cooper Basin, servicing a conventional gas field of the same name which is majority owned by Santos.

Screenshot of the since deleted South Australian Police update

Social media posts on the South Australia Police Facebook page were later removed  but the official Santos post is still visible here.

The near-miss, which came close to causing multiple fatalities, was described in the now-deleted social media posts as “not a small thing, Santos are keeping it quiet, flames were seen 80m in the air”. It was officially reported as: “Toolachee pipeline pig receiver Loss of Containment Incident (LOCI) located at Strzelecki “T” junction manifold on Della Road 1st July 2019”.

What followed was an investigation and final close-out report from the South Australian Department of Energy and Mining which reported that “no material safety or environmental damage resulted from this incident and Santos co-operated willingly and openly throughout DEM-ERD’s investigation”. Santos does not appear to have been fined or suffered any regulatory or punitive action for the near-disaster, reported by the company as a “Serious Incident”.

Dropped hammer ruptured nipple valve causing pressurised release of gas

The facts of the Toolachee incident reveal Santos was undertaking “pipeline pigging” operations on the pipeline and repairs to a leaking shut-in valve, during which a hammer fell from height onto a drain line, causing an uncontrolled gas release from the pressurised gas flow. It is indicative of poor safety practices that the hammer was not prevented from falling and that maintenance works were being conducted without the pipeline being depressurised. NWPA question whether Santos was in breach of the Australian Pipelines and Gas Association (APGA) mandatory criteria under AS/NZ 2885 The Standard or Gas and Liquid Petroleum Pipelines. The Annual report which covers this incident is available here and details five other serious incidents in the 2019 reporting year.

Excerpt from the 2019 Santos Annual Report for South Australian Cooper Basin Joint Venture
Operations

Records of the Department of Energy and Mining’s investigation obtained under Freedom of Information legislation by North West Protection Advocacy reveal that Santos failed to share critical information with the South Australian Police in a timely manner:

“Issues experienced in relation to this incident have occurred due to the lack of information sharing between SANTOS incident management and SAPOL. The incident was reported to SAPOL at approximately 1400 hours – despite numerous attempts by SAPOL forward command unable to gain information from SANTOS as to sit rep. At approximately 1730 hours SAPOL provided an update with full information as to all of the above. The failure to share information resulted in A/C (Area Command) involvement to ensure SANTOS provided update. Of note: the industry regulator were not made aware until A/C involvement. As at 1830 hours SANTOS has still not advised Safework SA – however of note no injury to staff – gas exposure only.”

Excerpt from the FOI detailing the incident

The Department had to press Santos for information and the company’s report was submitted outside the 3 month deadline on the 21st October 2019.

Damning description of Santos unsound practices and lack of safety planning was disclosed in Freedom of Information documents.

Gas pipeline safety a threat to NSW regional communities

Until now, safety concerns about the QHGP have centred around the safety record of its previous Managing Director Garbis Simonian’s other business, Weston Aluminium, which faces investigations for an industrial fire in November 2021 and a spill of 40 tonnes of molten aluminium just 8 months later in July at the Kurri Kurri plant. However, assurances made by pipeline vendor Mr Simonian that “Santos are the ones that can bring gas to market the fastest because they have a gasfield and they have experience in the construction of gas pipelines”, appear hollow and unfounded based on Santos’ track record of safety problems.

Santos claims the necessity of its purchase of the for supplying methane gas from the much-delayed Narrabri Gas Project (approved in 2020 and still awaiting commencement of Phase 1 to inform FID), there is no final route or indicative layout explaining how it will connect the 20km plus distance from the currently proposed pipeline route to the Narrabri Gas Project.

The pipeline passes through the economically significant food and fibre growing Liverpool Plains region, this region is made up of vertosol soils. These soils crack and swell, and they are also some of the best soils for food and fibre production in the state.

It is known the pipeline route passes in front of a significant explosives precursor facility at Boggabri which supplies the nearby coal mines and a range of sensitive properties including one of Boggabri Coal’s biodiversity offsets for the Leard State Forest.

Santos’ Vision Statement aiming to “Become the market leader in running the safest and lowest cost facilities and infrastructure operations – Lowest cost onshore operator in Australia” is a poor prognosis for safety on the QHGP. The Toolachee incident clearly shows that Santos’ efforts to become a low-cost operator will sacrifice safety and introduce risks of gas leaks, spills, fires and explosions for landholders and communities in the vicinity of their operations.

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