Peter Ker Sydney Morning Herald 5 Feb 11;
THE company responsible for one of Australia's worst oil spills is being allowed to continue, and potentially expand, its operations in Australian waters.
Barely 18 months after PTTEP Australasia caused a 10-week oil spill off the north-west coast, the company is poised to proceed with a five-year plan that includes more projects in Australia.
In a decision that has concerned environmentalists, the Minister for Resources and Energy, Martin Ferguson, said changes promised by PTTEP after the Montara disaster had convinced him the company could continue to operate safely in Australian waters.
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He made the decision despite an independent report warning him that nothing more than PTTEP's "intent" to improve its performance could be assessed at this time.
The report, by consultants Noetic, said PTTEP's plans to improve its performance would "depend entirely on the quality of execution" and it recommended the government maintain close scrutiny of the company's progress in coming months.
Mr Ferguson accepted the recommendation, saying he would subject PTTEP to a "rigorous" 18-month monitoring program to ensure the improvement plans were "implemented to the letter".
The minister's approval was welcomed by PTTEP, which revealed a five-year plan last year that named Australia alongside Burma, Indonesia and Thailand as countries in which the company wanted to "expand growth" through mergers and acquisitions.
Any expansion plans by PTTEP would be subject to an extra layer of conditions and scrutiny on application, Mr Ferguson said yesterday.
"There is a clear message to the industry that your social licence to operate in Australia cannot be taken for granted.
"Yes, this industry is exceptionally important to us, from an export and employment point of view, but we also require strict adherence to the best possible standards in terms of health, safety and environment," he said.
A spokesman for the Australian Marine Conservation Society, Darren Kindleysides, said the federal government's response sent a bad signal to the resources industry.
"This sends a signal that major oil companies can continue as business as usual, even if they do cause major spills," he said.
"Montara was one of Australia's largest ever environmental disasters.
"It seems they can get away with a rap on the wrist."
Montara decision sends wrong signal: WWF
Andrea Hayward and Ed Logue AAP Sydney Morning Herald 4 Feb 11;
A decision to allow a Thai company behind Australia's worst oil spill to continue operating locally sends the wrong signal to oil companies, environmentalists say.
Resources Minister Martin Ferguson on Friday announced that Thai government-owned company PTTEP Australasia would be subject to a rigorous government monitoring program.
A commission of inquiry found PTTEP had not used sensible oilfield practices, which led to its Montara wellhead, off Western Australia's northwest coast, leaking oil and gas condensate into the Timor Sea for 10 weeks in 2009.
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Failure to comply could result in its production and exploration licences being cancelled at any time.
The decision followed an independent review of the company's action plan which it submitted to address deficiencies identified by the inquiry.
Mr Ferguson said he had not issued a show-cause notice to the company as to why it should be allowed to continue to operate because PTTEP was "on the path" to better governance and practices in the action plan.
PTTEP will have to report monthly and meet quarterly with Mr Ferguson under a binding agreement for the next 18 months.
"You should also not forget, that I ... have the option to issue a show cause following due process at any time in the future," Mr Ferguson said.
The review did not recommend PTTEP's seven exploration licences, five production licences and seven other leases in Australia be revoked.
PTTEP spokesman Chris Kalnin said the company's action plan was under constant review.
"The drilling operations of PTTEP have changed substantially since the Montara incident occurred," Mr Kalnin said.
WWF WA director Paul Gamblin said there was a real concern the signal sent to big oil companies is they could cause large environmental disasters and expect to continue business.
"There is no disincentive, there's no penalties," Mr Gamblin said.
"That's what I think many Australians will be scratching their heads about."
PTTEP footed the entire clean-up bill of about $300 million, backed by the Thai government and it faces prosecution for breaches of health, safety and regulatory breaches.
Mr Gamblin said the government's response to the environmental disaster was inadequate and the true environmental cost of the oil spill may never be known because of poor government monitoring systems before and after the spill.
The government had failed to establish a single national regulator as promised and is facing opposition from the WA government to do so, he said.
"Nothing's really changed," he said.
An additional set of conditions will be imposed on the renewal or future granting of offshore petroleum title applications to PTTEP in Australia.
Australian Greens Senator Rachel Siewert said it was unacceptable for new licences to be granted to PTTEP while there were questions about the company meeting industry standards.
"I remain concerned that there are significant safety and regulatory problems within our offshore oil and gas industry that are not limited to PTTEP," she said, adding that the Greens would push for tougher regulations.
Mr Ferguson said the entire oil industry was on notice to meet community expectations.
Australia lets Thai oil firm stay despite spill
(AFP) Google News 4 Feb 11;
SYDNEY — A Thai government-owned company behind Australia's worst oil spill was given the go-ahead to continue local operations but will be subject to a rigorous government monitoring programme.
PTT Exploration and Production's response to issues raised by the massive Montara oil spill in the Timor Sea two years ago was a key factor in renewing their licence, Australia's Energy Minister Martin Ferguson said in a statement on Friday.
"The company has cooperated fully throughout the review process and demonstrated significant changes to improve its leadership, governance and operating practices," Ferguson said.
Still, its production and exploration licences could be cancelled any time in the next 18 months if the firm fails to meet strict new standards, he said.
A wellhead at the company's Montara oilfield leaked oil and gas condensate for 10 weeks off Western Australia's northwest, in 2009.
Thousands of barrels of oil poured into the sea before it was capped, prompting conservationists to warn of an environmental catastrophe for the region's marine and bird life.
An independent report into the August 2009 incident found "widespread and systemic" shortcomings in PTTEP's procedures were a direct cause of a loss of well control.
