Federal Court of Australia

Wilderness Society Ltd v National Offshore Petroleum Safety and Environmental Management Authority [2026] FCA 1082

ORDERS

THE COURT ORDERS THAT:

1.    The application for review be dismissed.

2.    The applicant is to pay the first respondent and second respondent the costs of this application, to be agreed or assessed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

ABRAHAM J:

1    The Wilderness Society Ltd (TWS) is an Australian not-for-profit environmental advocacy organisation that is registered with the Australian Charities and Not-for-profits Commission. TWS seeks an order setting aside the decision made by a delegate of the Chief Executive Officer of the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) on 8 May 2025, to accept the Reindeer Wellhead Platform and Gas Supply Pipeline Operations and Cessation of Production Environment Plan (Reindeer EP) submitted by Santos WA Northwest Pty Ltd (Santos). NOPSEMA is the first respondent, and Santos is the second respondent.

2    The decision to accept the Reindeer EP was made under reg 33 of the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2023 (Cth) (the Regulations). Regulation 33(1)(a) and (7)(a) relevantly provide that, subject to reg 16, NOPSEMA must accept an environment plan if it is reasonably satisfied that it meets the environment plan acceptance criteria. Pursuant to reg 16(1)(a), NOPSEMA must not accept an environment plan under reg 33 for a petroleum activity under a petroleum title, unless NOPSEMA is reasonably satisfied that the titleholder is compliant with s 571(2) of the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (Cth) (the Act) “in relation to the petroleum activity”.

3    There is a sole ground of judicial review (as amended on 27 November 2025):

The First Respondent [NOPSEMA] misconstrued s 571(2) of the [Act] as not requiring a financial assurance to deal with decommissioning costs, expenses and liabilities and therefore could not have been reasonably satisfied that the Second Respondent [Santos] is compliant with s 571(2) of the [Act] in relation to the petroleum activity, as required by regs 16 and 33 of the [Regulations]. In those circumstances, the First Respondent’s [NOPSEMA’s] decision to accept the Reindeer EP is infected by jurisdictional error and an error under s 5(1)(b), (c) (d), (e) (read with (2)(b)) and/or (f) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act).

4    The issue for determination is therefore whether NOPSEMA erred in failing to construe s 571(2) of the Act as requiring financial assurance for decommissioning costs, expenses and liabilities, in forming the state of reasonable satisfaction required by reg 16(1) of the Regulations in relation to the Reinder EP.

5    For the reasons below, TWS has not established the ground of review. The application is to be dismissed with costs.

Factual background

6    Santos and Santos (BOL) Pty Ltd (Santos BOL) are the “titleholders” (within s 571(5) of the Act) of a “petroleum production licence” granted on 27 October 2009 (WA-41-L), and a “pipeline licence” granted on 16 October 2009 (WA-18-PL). The areas covered by these licences are in the Barrow Sub-basin on the North West Shelf, offshore of Western Australia. WA-18-PL runs to the Commonwealth-State boundary. Relevantly, under these licences Santos operates in Commonwealth waters: the Reindeer wellhead platform (located around 80km northwest of Dampier) and three associated wells within WA-41-L; and the 43km long offshore section of the Devil Creek Gas Supply Pipeline which is the subject of WA-18-PL.

7    On 13 September 2024, Santos and Santos BOL first submitted the Reindeer EP “to enable [them] to undertake the petroleum activity described in the [environment plan]”. On 24 April 2025, Santos submitted the version of the Reindeer EP that was accepted by NOPSEMA in the decision that is the subject of this judicial review, incorporating revisions made in response to NOPSEMA’s requests for information.

8    As Santos submitted, the activity is described in the Reindeer EP under the heading ‘Scope of this Environment Plan’ as follows:

•    Operations phase:

•    Presence of infrastructure on title

•    Operation of the wellhead platform, wells and DC supply pipeline

•    Transporting unprocessed condensate from the Reindeer field to [Devils Creek Gas Plan]

•    Vessel based activities associated with operations; and

•    IMMR [inspection, maintenance, monitoring and repair] activities described below may also be undertaken during the operations phase.

•    CoP [cessation of production] (preservation) phase:

•    Commences when the facility reaches end of field life and is shut in and depressurised

•    The facilities are cleaned and flushed to remove hydrocarbons and contaminants

•    The facilities are then preserved using treated seawater or inert gas such as nitrogen

•    The Reindeer facilities will remain in preservation phase until a decision is made to either repurpose the facilities or decommission all, or part of the facilities; and

•    IMMR activities described below may also be undertaken during the preservation phase to maintain the

•    integrity of the facilities.

•    [IMMR] may be undertaken during the operations phase or CoP phase and includes activities such as:

•    Subsea and DC supply pipeline integrity and corrosion management

•    Flushing and cleaning of infrastructure and DC supply pipeline

•    Subsea, pipeline and seafloor imaging surveys

•    Subsea, pipeline and seafloor visual and sampling surveys

•    Plant inspection, maintenance and modifications

•    Well intervention, temporary abandonment or suspension

•    Bird deterrence on the WHP.

9    In respect to the timeline of the petroleum activities in the Reindeer EP and the steps to be taken after those activities conclude, Santos described in submissions:

[30]    Regarding the timeline for the Reindeer Petroleum Activities, the Reindeer EP provides that the operations phase is expected to continue until mid-2025, at which time the CoP (preservation phase) would commence (at [2.3]). The Reindeer facilities are “expected to be in preservation phase for a minimum of 36 months while decisions are made on whether the facilities will be decommissioned or repurposed” (at [2.10]).

[31]    As to the steps that are to occur after the activities the subject of the Reindeer EP, the EP states:

a.    Santos is “currently assessing two re purposing options for the Reindeer facility, reuse of the DC supply pipeline for CCS or use of the Reindeer facility and [Devil Creek Gas Plant] for processing hydrocarbons from the Corvus field” (at [2.12]). In support of the potential reuse for CCS, Santos had obtained a permit to undertake evaluation and appraisal work for the potential storage of carbon dioxide at the Reindeer field, submitted an Application for Declaration of an Identified Greenhouse Gas Storage Formation, and signed a Memorandum of Understanding with a proponent to develop a carbon sequestration project (at [2.12], [2.12.1]). Regulatory approvals would be required for any CCS project, such as an EP for those specific activities (Table 2-7, row 1). The “estimated dates for CCS final investment decision (FID) readiness” is “2026” with “execution in 2029” if CCS proceeded (at [2.12.1]).

b.    In parallel, Santos is progressing plans for “decommissioning … as a distinct project” (at [2.12.3]). Decommissioning activities are to be the subject of a subsequent EP in 2028-2029, including by way of “stakeholder consultation with relevant persons” for those activities (Table 2-8, row 4; [2.13], [2.13.1], [2.13.6]). If CCS does not proceed, “offshore decommissioning execution” will occur, “in accordance with an accepted decommissioning environment plan”, in approximately 2030-2031 (Table 2-8, row 5). The “decommissioning EP” would address, amongst other things, “detailed plans of the proposed subsea decommissioning activities” and “proposed decommissioning methodology”, and “an evaluation of the feasibility of all options” (at [2.13.6]).

10    By its financial assurance confirmation signed 14 January 2025, Santos confirmed that it had calculated financial assurance for the activities under the Reindeer EP, and that the titleholders had provided NOPSEMA with financial assurance declarations for “all titles which authorise the petroleum activities included in this environment plan”.

11    On 8 May 2025, a delegate of the chief executive officer of NOPSEMA made the decision to accept the Reindeer EP under reg 33 of the Regulations. On 4 July 2025, the delegate published a statement of reasons for their decision. At [14] the delegate stated:

In accordance with regs 16 and 34, I must not accept an EP unless I am reasonably satisfied that the titleholder is compliant with subsection 571(2) of the [Act] in relation to the petroleum activity, and the compliance is in a form that is acceptable to me. On review of the titleholder’s financial assurance declaration and confirmation forms, I was reasonably satisfied that the titleholder was compliant with s 571(2), and the financial assurance declaration and confirmation forms were acceptable. I therefore considered that the requirement in reg 16 was met.

12    On 7 July 2025, an employee of TWS sent an email to NOPSEMA asking whether it undertook an assessment of financial assurance to meet decommissioning costs when assessing the Reindeer EP. An employee of NOPSEMA responded that same day:

The financial assurance assessment has been undertaken in accordance with the scope limitations outlined in the Environment plan decision making guideline.pdf, and with reference to the Financial Assurance for petroleum titles policy.pdf and the guideline for Financial Assurance for Petroleum Titles 2024-10-17.pdf. The assessment does not, therefore, extend to the evaluation of financial assurance provisions intended to address decommissioning liabilities.

Statutory regime

13    As Santos described, the object of the Act is to provide an effective regulatory framework for petroleum exploration and recovery, and the injection and storage of greenhouse gas substances, in “offshore areas”: s 3. These offshore areas are essentially in Commonwealth waters: see ss 4 and 7 of the Act. The Act erects a system for regulating offshore activities, being: exploration for petroleum; recovery of petroleum; construction and operation of infrastructure facilities relating to petroleum or greenhouse gas substances; construction and operation of pipelines for conveying petroleum or greenhouse gas substances; exploration for potential greenhouse gas storage formations; and injection and storage of greenhouse gas substances: s 4. An aspect of that system is the grant of certain “titles”, in the form of permits, leases, licences or authorities: s 4.

14    Relevantly, a petroleum production licence authorises the licensee to: recover petroleum in the licence area or another area to which the licensee has lawful access for that purpose; explore for petroleum in the licence area; and carry on such operations, and execute such works, in the licence area as are necessary for those purposes: s 161(1) of the Act. A pipeline licence authorises the licensee to: construct, in the offshore area specified in the licence and according to the licence specifications, a pipeline, pumping stations, tank stations and valve stations; operate the pipeline and stations; and carry on such operations, execute such works and do all such other things in the offshore area as are necessary for, or incidental to, the construction or operation of that infrastructure: s 211(1) of the Act.

15    The object of the Regulations made under s 781 of the Act is to ensure that any petroleum activity or greenhouse gas activity in an offshore area is carried out in a manner: consistent with the principles set out in s 3A of the Environment Protection and Biodiversity Conservation Act 1999 (Cth); and by which the environmental impacts and risks of the activity will be reduced to as low as reasonably practicable and of an acceptable level: reg 4 of the Regulations.

16    Petroleum activity is defined in reg 5 to mean operations or works in an offshore area undertaken for the purpose of: exercising a right conferred on a petroleum titleholder under the Act by a petroleum title; or discharging an obligation imposed on a petroleum titleholder by the Act or a legislative instrument under the Act.

17    To undertake any “activity under the title”, a titleholder must have an environment plan “in force for the activity”, or it commits a strict liability offence: reg 17(1) of the Regulations. Before commencing an activity under a title, the titleholder must submit an environment plan for the activity to NOPSEMA: reg 26(1). “Activity” means “petroleum activity” or “greenhouse gas activity” and, where the context permits, includes “a reference to a proposed activity or any stage of an activity”: reg 5. If NOPSEMA gives its approval, an environment plan may relate to “one or more stages of an activity”: reg 26(7)(a), or to “more than one activity”: reg 26(7)(c). A titleholder must then submit a revised environment plan for an activity under the title every 5 years (reg 41(1)), or earlier where the titleholder proposes to change the activity, or commence a new activity or new stage of an activity: regs 38 and 39.

18    The required content of an environment plan for an activity is addressed in reg 21:

21    Environmental assessment

Description of the activity

(1)    The environment plan must contain a comprehensive description of the activity including the following:

(a)    the location or locations of the activity;

(b)    general details of the construction and layout of any facility that is used in undertaking the activity;

(c)    an outline of the operational details of the activity (for example, seismic surveys, exploration drilling or production) and proposed timetables for undertaking the activity;

(d)    any additional information relevant to consideration of environmental impacts and risks of the activity.

Note:    An environment plan will not be capable of being accepted by NOPSEMA if an activity or part of the activity, other than arrangements for environmental monitoring or for responding to an emergency, will be undertaken in any part of a declared World Heritage property (see section 34).

Description of the environment

(2)    The environment plan must:

(a)    describe the existing environment that may be affected by the activity; and

(b)    include details of the relevant values and sensitivities (if any) of that environment.

Note:    The definition of environment in section 5 includes its social, economic and cultural features.

(3)    Without limiting paragraph (2)(b), relevant values and sensitivities may include any of the following:

(a)    the world heritage values of a declared World Heritage property;

(b)    the National Heritage values of a National Heritage place;

(c)    the ecological character of a declared Ramsar wetland;

(d)    the presence of a listed threatened species or listed threatened ecological community;

(e)    the presence of a listed migratory species;

(f)    any values and sensitivities that exist in, or in relation to, part or all of:

(i)    a Commonwealth marine area; or

(ii)    Commonwealth land.

Requirements

(4)    The environment plan must:

(a)    describe the requirements, including legislative requirements, that apply to the activity and are relevant to the environmental management of the activity; and

(b)    demonstrate how those requirements will be met.

Evaluation of environmental impacts and risks

(5)    The environment plan must include:

(a)    details of the environmental impacts and risks of the activity; and

(b)    an evaluation of all the environmental impacts and risks, appropriate to the nature and scale of each impact or risk; and

(c)    details of the control measures that will be used to reduce the impacts and risks of the activity to as low as reasonably practicable and an acceptable level.

(6)    To avoid doubt, the evaluation mentioned in paragraph (5)(b) must evaluate all of the environmental impacts and risks arising directly or indirectly from:

(a)    all operations of the activity; and

(b)    any potential emergency conditions, whether resulting from an accident or any other cause.

Environmental performance outcomes and standards

(7)    The environment plan must:

(a)    set environmental performance standards for the control measures identified under paragraph (5)(c); and

(b)    set out the environmental performance outcomes for the activity against which the performance of the titleholder in protecting the environment is to be measured; and

(c)    include measurement criteria that the titleholder will use to determine whether each environmental performance outcome and environmental performance standard is being met.

19    Where NOPSEMA has provisionally decided that a proposed environment plan addresses all necessary regulations, it must publish the environment plan and certain other details on its website: regs 27 - 28. Then, “subject to [reg] 16”, NOPSEMA must decide to accept the environment plan if it is “reasonably satisfied that the environment plan meets the environment plan acceptance criteria” in reg 34: reg 33(1) and (7).

20    Regulation 16(1) states:

16    Demonstration of financial assurance prior condition for acceptance of environment plan

(1)    For the purposes of paragraphs 571(3)(a) and (b) of the Act, NOPSEMA must not accept an environment plan, under section 33 of this instrument, for a petroleum activity under a petroleum title unless NOPSEMA is reasonably satisfied that:

(a)    the titleholder is compliant with subsection 571(2) of the Act in relation to the petroleum activity; and

(b)    the compliance is in a form that is acceptable to NOPSEMA.

Note:    Failure by a petroleum titleholder to maintain compliance with subsection 571(2) of the Act, in a form acceptable to NOPSEMA, is a ground for withdrawing the acceptance of an environment plan: see paragraph 43(1)(e) of this instrument.

21    Regulation 16(1) establishes a jurisdictional fact that there has been compliance by the titleholder to NOPSEMA’s reasonable satisfaction: see e.g. Tipakalippa v NOPSEMA (No 2) [2022] FCA 1121; (2022) 406 ALR 41 at [268]; Wei v Minister for Immigration and Border Protection [2015] HCA 51; (2015) 257 CLR 22 at [33].

22    Section 571 of the Act is as follows:

571    Financial assurance—petroleum titles

Scope

(1)    This section applies in relation to a petroleum activity carried out in relation to any of the following titles:

(a)    a petroleum exploration permit;

(b)    a petroleum retention lease;

(c)    a petroleum production licence;

(d)    an infrastructure licence;

(e)    a pipeline licence;

(f)    a petroleum special prospecting authority;

(g)    a petroleum access authority.

Titleholder duty to maintain financial assurance

(2)    The titleholder must, at all times while the title is in force, maintain financial assurance sufficient to give the titleholder the capacity to meet costs, expenses and liabilities arising in connection with, or as a result of:

(a)    the carrying out of the petroleum activity; or

(b)    the doing of any other thing for the purposes of the petroleum activity; or

(c)    complying (or failing to comply) with a requirement under this Act, or a legislative instrument under this Act, in relation to the petroleum activity.

Examples:    This subsection covers costs, expenses and liabilities arising in connection with, or as a result of, the following (without limitation):

(a)    complying with the titleholder’s duty under section 572C (which relates to the escape of petroleum);

(b)    a debt due to the Commonwealth, NOPSEMA, a State or the Northern Territory under section 572D, 572E or 572F (which relate to an escape of petroleum), including a debt due to an agency or authority on behalf of the State or the Northern Territory;

(c)    complying with a direction under section 574 or 586 relating to the remediation of damage to the seabed or subsoil arising in connection with a petroleum activity.

(3)    The following may be provided for by regulation:

(a)    compliance with subsection (2) in relation to a petroleum activity to be demonstrated as a prior condition of acceptance of an environment plan for the activity;

(b)    such compliance to be in a form acceptable to NOPSEMA;

(c)    a failure to maintain such compliance, in a form acceptable to NOPSEMA, to be grounds for the withdrawal of acceptance of an environment plan for the activity.

Form of financial assurance

(4)    The forms of financial assurance for a title that may be maintained for the purposes of this section include (without limitation) any of the following, or any combination of the following:

(a)    insurance;

(b)    self-insurance;

(c)    a bond;

(d)    the deposit of an amount as security with a financial institution;

(e)    an indemnity or other surety;

(f)    a letter of credit from a financial institution;

(g)    a mortgage.

(5)    In this section:

environment plan for a petroleum activity means an environment plan for the activity under prescribed regulations, or a prescribed provision of regulations, made under this Act.

financial institution has its ordinary meaning, and (to avoid doubt) includes:

(a)    an authorised deposit-taking institution within the meaning of the Banking Act 1959; and

(b)    a financial institution of a foreign country.

petroleum activity has the meaning given by prescribed regulations, or a prescribed provision of regulations, made under this Act.

self-insurance: for a petroleum activity in relation to a title, the titleholder maintains financial assurance in the form of

self-insurance to the extent that the titleholder ensures that financial resources are available at all times while the title is in force to meet costs, expenses and liabilities in relation to the activity arising as mentioned in subsection (2).

titleholder, for a title in relation to which this section applies, means the registered holder of the title.

23    TWS emphasised the Act imposes or contemplates the imposition of obligations relevant to decommissioning on titleholders in ss 270(3), 572(3), 574-574A and 586-587A. At this stage it suffices to refer to s 572, as it is the provision on which most reliance was placed by TWS. Relevantly, s 572 provides:

572    Maintenance and removal of property etc. by title holder

….

Maintenance of property etc.

(2)    A titleholder must maintain in good condition and repair all structures that are, and all equipment and other property that is:

(a)    in the title area; and

(b)    used in connection with the operations authorised by the permit, lease, licence or authority.

Removal of property etc.

(3)    A titleholder must remove from the title area all structures that are, and all equipment and other property that is, neither used nor to be used in connection with the operations:

(a)    in which the titleholder is or will be engaged; and

(b)    that are authorised by the permit, lease, licence or authority.

24    It is also appropriate to refer to s 572(7):

(7)    This section has effect subject to:

(a)    any other provision of this Act; and

(b)    the regulations; and

(c)    a direction given by NOPSEMA or the responsible Commonwealth Minister under:

(i)    Chapter 3; or

(ii)    this Chapter; and

(d)    any other law.

Submissions

25    This application, as articulated in TWS’s submissions in chief, is based on the construction of the relevant Act and Regulations. To restate TWS’s argument succinctly:

In making the Decision, NOPSEMA misconstrued s 571(2) of the [Act] as not requiring a financial assurance to deal with decommissioning costs. NOPSEMA therefore could not have been “reasonably satisfied” that Santos is compliant with s 571(2) of the Act in relation to the petroleum activity, as required by [regs] 16 and 33 of the [Regulations]. In those circumstances, the Decision is infected by jurisdictional error and an error under s 5(1)(b), (c), (d), (e) (read with (2)(b)) and/or (f) of the [ADJR Act] and should be set aside.

26    TWS submitted that the delegate formed his state of satisfaction “[o]n review of the titleholder’s financial assurance declaration and confirmation forms”: paragraph [18] of the delegate’s reasons. It submitted the financial assurance was calculated in accordance with the Australian Energy Producers’ 2024 Method for Estimating Levels of Financial Assurance (AEP method), which was said to be confined to estimating the cost of responding to an accidental oil spill event and does not include decommissioning.

27    TWS also relied on the email sent by an employee of NOPSEMA on 7 July 2025, recited at [12] above. TWS submitted an inference can be drawn that NOPSEMA construed the financial assurance obligation in s 571(2) of the Act as only extending to extraordinary costs, expenses and liabilities “that may arise from a worst-case petroleum incident”, such as those that may arise from an oil spill, and not extending to “ordinary operating costs or compliance costs of the titleholder in meeting its obligations under the [Act] and regulations”. This is based on the language used in certain parts of the guidelines and policies linked in the email: e.g. p 1 of NOPSEMA, Financial Assurance for Petroleum Titles Policy (N-04730-PL1780) and pp 2-3 of NOPSEMA, Financial Assurance for Petroleum Titles Guideline (N-04730-GL1381). TWS submitted that therefore NOPSEMA proceeded to make its decision that it was reasonably satisfied Santos was compliant with s 571(2) on the basis the financial assurance obligation did not extend to decommissioning costs. Based on that inference, TWS submitted:

The question that distils from NOPSEMA’s construction of s 571(2) is whether the financial assurance obligation is confined to “extraordinary” costs, expenses and liabilities “that may arise from a petroleum incident relating to the activities of the titleholder”, such as those that may arise from an oil spill, or whether it extends to the costs associated with decommissioning a project.

28    Thereafter, TWS’s submission focussed on its construction of s 571(2), in particular relying on the phrases “in connection with” and “as a result of” within the provision to submit the financial assurance obligation imposed is broad, and includes decommissioning costs. That is said to be because, inter alia, s 571(2)(c) imposes a requirement to maintain financial assurance in respect to obligations imposed by the Act. TWS submitted that the reference in s 571(2)(c) to these obligations is sufficiently broad to include those relevant to decommissioning in ss 270(3), 572(3), 574-574A and 586-587A.

29    In their submissions, the respondents focussed on whether NOPSEMA erred in failing to construe s 571(2) of the Act as requiring financial assurance for decommissioning costs in forming the state of satisfaction that reg 16(1) required in relation to the Reindeer EP. The respondents took issue with TWS’s submission relying on the email, and the AEP method. In essence, the respondents contended these provisions focus on the particular activity the subject of the environment plan, that NOPSEMA determined that the Reindeer EP did not seek approval for a decommissioning activity, and on that basis decommissioning costs were not required to be the subject of a financial assurance.

30    In its written submission in reply, TWS submitted inter alia, that the respondents’ position is predicated on the proposition that the Reindeer EP does not cover decommissioning activities, which is incorrect as the environment plan does include such activities. TWS submitted that on the respondents’ construction of the statutory regime, the financial assurance obligation would be “triggered” for decommissioning costs if those activities were included in the Reindeer EP. Accordingly, even on the respondents’ construction of s 571(2) of the Act and reg 16 of the Regulations, NOPSEMA needed to be reasonably satisfied Santos had financial assurance for the costs associated with carrying out the decommissioning activities in the Reindeer EP.

31    The respondents submitted that position – that the Reindeer EP does in fact include and cover decommissioning activities – is a new case advanced by TWS for the first time in reply and it should not be entertained. In any event, the respondents submitted this is a misinterpretation of their case. I return to this issue below.

Preliminary observations

32    There are two preliminary observations to be made.

33    First, TWS’s reliance on the 7 July 2025 email recited above at [12] is misplaced. The email was not sent by the delegate, and did not purport to supplement NOPSEMA’s reasons for accepting the Reindeer EP. It does not form part of NOPSEMA’s reasons. It follows that TWS’s focus on the reason given in that email as founding an error in the construction of s 571(2) does not advance its case.

34    Second, there are findings by NOPSEMA which TWS has not challenged which are of significance. First, at paragraph [19] of the delegate’s reasons, he concluded that decommissioning is “not part of the scope of this [environment plan], but will be covered under a subsequent decommissioning [environment plan]”. Second, and taking that conclusion into account, the delegate determined at paragraphs [68] – [71] that the Reindeer EP complied with the titleholders’ obligations in s 572(2) and (3), provisions of the Act which, as explained above, TWS relies heavily on. TWS’s ground of review does not challenge the correctness of the delegate’s characterisation of the Reindeer EP as not covering decommissioning, or the conclusion that Santos met the obligations in s 572(2) and (3) in respect of the activity addressed by the Reindeer EP. I address the significance of these unchallenged findings below.

New case

35    It is appropriate at the outset to address whether TWS has advanced a new case in reply. I accept the respondents’ submission that TWS introduced a new case in its written submission in reply, that the Reindeer EP does in fact include decommissioning activities. For the reasons that follow, TWS cannot rely on this case, which in any event does not assist it.

36    First, as the respondents submitted, the delegate expressly stated in his reasons for accepting the Reindeer EP at [19]:

Decommissioning is not part of the scope of this [environment plan], but will be covered under a subsequent decommissioning [environment plan] ….

37    As explained above, TWS did not submit that finding was erroneous in its further amended originating application, written submissions in chief, or reply. Despite the fact the originating application has been amended, no challenge to NOPSEMA’s conclusion was added. TWS cannot advance its new argument that decommissioning fell within the scope of the Reindeer EP, without challenging the correctness of that conclusion.

38    Second, this case falls outside the scope of TWS’s originating application and was not ventilated in its submissions in chief. It is inconsistent with the case in chief, the affidavit accompanying the originating application, and representations TWS’s legal representatives made to the respondents about the nature and scope of its judicial review challenge.

39    To put it starkly, TWS’s submissions in chief stated that while decommissioning is raised as a potential future option in the Reindeer EP, “the execution of decommissioning or repurposing activities are expressly excluded from the scope of the Reindeer EP”: AS [4]. The submissions thereafter are framed on that premise: e.g. AS [17] and [40]. The position that decommissioning was not part of the Reindeer EP is also consistent with its pre-litigation approach. In the consultation process for the Reindeer EP, TWS raised an objection that the environment plan did not include decommissioning. That is also reflected in TWS’s email correspondence with NOPSEMA after the Reindeer EP was accepted: see e.g. [12]. That is, its position was that the Reindeer EP did not, but ought to, include decommissioning activities.

40    To make this new submission, TWS changed its approach to defining the concept of decommissioning. The Act uses, but does not define, the term “decommissioning”. In its submissions in chief, TWS used concepts such as “decommissioning a project”, language which, in context, tends to convey the stage where a project reaches the end of its useful life. That is consistent with TWS’s submission at AS [34]:

While decommissioning is an inevitable phase of a petroleum activity, it is a separate one that substantially occurs once operations have ceased. The once-off costs associated with that phase are not “operating” costs.

41    In contrast, in reply, TWS appeared to contend that any removal of equipment or property from the title area is properly characterised as “decommissioning”. It can be accepted there has been a change in TWS’s approach to defining decommissioning activities. The respondents submitted the new definition conflates planning for future decommissioning and pre-decommissioning activities, with decommissioning itself. They submitted these are logically and chronologically distinct activities. Ordinarily planning is required to be undertaken prior to decommissioning, and one can plan for a future activity without it being presently extant.

42    Third, this new case is said by TWS to be in the alternative, as a response to Santos’ and NOPSEMA’s case. That is, even on the respondents’ case as to the construction of s 571(2) and reg 16, the Reindeer EP relates to decommissioning and therefore financial assurance for that is required. As will be apparent from the discussion below, this submission fundamentally misconceives the respondents’ case. For now, it suffices to say that the respondents submitted that s 571(2) and reg 16 are directed to the petroleum activity for which NOPSEMA approval is sought. That is, its case is not based on an assessment of the environment plan at large, unrestrained by the characterisation of the petroleum activity for which approval was sought. The unchallenged characterisation by NOPSEMA is that the Reindeer EP did not seek approval for a decommissioning activity.

43    As apparent from its terms recited above at [18], reg 21 specifies the contents of an environment plan in relation to the activity for which approval is sought. The Reindeer EP did not address those requirements in relation to decommissioning, which is apparent from NOPSEMA’s characterisation of the environment plan in its reasons. TWS did not challenge this characterisation. It may be accepted that decommissioning is referred to in the Reindeer EP, as is evident in the extract set out at [8] above. But, given the content of the plan addresses the requirements of reg 21 in relation to other activities, it is plain Santos was not seeking approval for that in this environment plan. Indeed, the plan stated that decommissioning will be addressed in a subsequent environment plan. NOPSEMA accepted this to be the case in its reasons for accepting the Reindeer EP. The Reindeer EP included these references to address the NOPSEMA guidance material regarding decommissioning: see paragraph [68] of the delegate’s reasons. The delegate described these sections as identifying planning for decommissioning at paragraphs [19] and [68] of his reasons. Those references to decommissioning are best described as acts that are preparatory for decommissioning that might take place at a later time. That decommissioning comes within the definition of petroleum activity does not alter that. It is not the activity for which approval was sought by the Reindeer EP. TWS’s submission does not address the respondents’ case. As such, TWS’s new case does not assist it in establishing error.

44    It follows that TWS cannot rely on its new case, which in any event does not assist it.

Consideration

45    TWS’s case in chief is one solely based on the construction of the Act. It is appropriate to begin by considering the construction of the relevant provisions in the scheme.

46    Recently, the High Court in Palmanova Pty Ltd v Commonwealth of Australia [2025] HCA 35; (2025) 424 ALR 768 at [4], described statutory construction as (citations omitted):

The construction of a statutory provision begins and ends with the statutory text understood in context and in light of the statutory purpose – being what the provision is designed to achieve in fact – insofar as that purpose is discernible from the statutory text and context. In the construction of a provision of a Commonwealth statute, the meaning that would best achieve the statutory purpose so discerned is to be preferred to each alternative meaning.

47    The Court explained that context is to be understood in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means, one may discern the statute was intended to remedy: at [5]-[6]. The use of extrinsic material in the construction is “guided but not governed by a non-exhaustive list of categories of material statutorily recognised to have potential to illuminate the statutory context”, citing s 15AB of the Acts Interpretation Act 1901 (Cth) (Acts Interpretation Act).

48    The principles relating to the interpretation of primary legislation are equally applicable to the interpretation of subordinate legislation: Disorganized Developments Pty Ltd v South Australia [2023] HCA 22; (2023) 280 CLR 515 at [14]-[15].

49    I agree with NOPSEMA that this is a case in which it is “useful to read together [the] regulations and the Act with which they were made, in order to identify the nature of a legislative scheme which they comprise”: Master Education Services Pty Ltd v Ketchell [2008] HCA 38; (2008) 236 CLR 101 at [19]. As NOPSEMA submitted, the operation of s 571 of the Act depends on the Regulations made under s 571(3) because those give the meaning of petroleum activity and environment plan: s 571(5). Therefore regard may be had to the Regulations in identifying the “legislative policy” that s 571 pursues: see e.g. Deputy Commissioner of Taxation (Cth) v Ellis and Clark Ltd (1934) 52 CLR 85 at 89; Alphapharm Pty Ltd v H Lundbeck A S [2014] HCA 42; (2014) 254 CLR 247 at [39]; Fuchs Lubricants (Australasia) Pty Ltd v Quaker Chemical (Australasia) Pty Ltd [2021] FCAFC 65; (2021) 284 FCR 174 at [166].

50    In summary, the respondents submitted the requirements imposed by the Act and Regulations in relation to the submission and acceptance of an environment plan are focused on the particular petroleum activity the titleholder seeks authorisation, through the environment plan, to conduct. I agree.

51    It is helpful at this stage to recall the definition of petroleum activity, referred to above. As Santos submitted, that term encompasses a range of activities across the whole life cycle of a titleholder’s use of a petroleum title including but not limited to: conducting seismic surveys; the drilling and completion of production wells; pipeline construction and installation; operational activities such as startup and commissioning steps, routine production, export of gas, inspection, monitoring, maintenance and repair of subsea infrastructure and associated surveys; steps taken to remove property brought into the title area; and decommissioning, dismantling or removing a facility or pipeline. The titleholder may carry out various activities at different times, depending on the nature of the project.

52    As a starting point, to undertake any “activity under the title”, a titleholder must submit to NOPSEMA an environment plan for the activity: reg 26. It is uncontroversial that NOPSEMA must not accept an environment plan unless it is reasonably satisfied the titleholder is compliant with s 571(2) of the Act in relation to the petroleum activity: see regs 16 and 34.

53    Turning first to reg 16. As a prior condition of acceptance of an environment plan, NOPSEMA must be reasonably satisfied the titleholder is compliant with s 571(2) of the Act “in relation to a petroleum activity”. I accept that reg 16 is focussed on a particular petroleum activity. So much is plain from the terms of the regulation, which provide that NOPSEMA must not accept an environment plan under reg 33 for “a petroleum activity”, unless reasonably satisfied the titleholder is compliant with s 571(2) of the Act “in relation to the petroleum activity” (emphasis added). The content of the environment plan is directed to “the activity” that is the subject of the plan: reg 21. As apparent from the terms of reg 21(1), the environment plan “must contain a comprehensive description of the activity” (emphasis added). Each requirement of an environment plan referred to thereafter at reg 21(2)-(7) hinges upon and is to be assessed relative to the activity described in the environment plan. Regulation 16 requires NOPSEMA to be reasonably satisfied the titleholder has complied with s 571(2) of the Act in relation to that petroleum activity at the time the titleholder has submitted a formal application to carry out the activity, by an environment plan that outlines all the features of that activity and the environmental impacts and risks it may pose.

54    The terms of reg 16, with their focus on a particular petroleum activity, are consistent with the statutory scheme as described above. It is “designed to apply to all types of petroleum activities or [greenhouse gas] activities, large or small, important or unimportant, and then to each stage of such activities. The regulatory scheme is designed to provide for a bespoke environment plan appropriate for the nature and scale of the activity and the consequential environmental impacts and risks”: Doctors for the Environment (Australia) Incorporated v NOPSEMA (No 2) [2025] FCA 989; (2025) 312 FCR 406 at [127]. As Santos submitted, the assessment and acceptance of environment plans under the Regulations hinges upon, and is closely tailored to, the particular nature of the petroleum activity that the titleholder seeks authorisation, through the environment plan, to conduct. The scheme envisages titleholders will incrementally seek approval of different activities over the life of a petroleum title. The Regulations permit further segmentation of petroleum activities into discrete stages that may be submitted for acceptance: see reg 26(7)(a).

55    Section 571 of the Act is also activity focussed. It “applies in relation to a petroleum activity carried out in relation to” a specified title: s 571(1) (emphasis added). The obligation to maintain financial assurance in s 571(2) applies in respect of “carrying out … the petroleum activity”: s 571(2)(a) (emphasis added). Section 571(3)(a) provides that compliance with s 571(2) “in relation to a petroleum activity” must “be demonstrated as a prior condition of acceptance of an environment plan for the activity” (emphasis added). This provision focuses, like reg 16, on the particular activity that is the subject of the environment plan. As NOPSEMA submitted, s 571(2) is not an obligation that requires titleholders to maintain financial assurance at all times in respect of all activities that could possibly be carried out under the title in the future. The obligation applies “at all times while the title is in force”, but only in respect of petroleum activities that are “carried out”: s 571(1).

56    Under the statutory scheme, it is the environment plan that identifies the nature and scope of the petroleum activity that the titleholder is seeking approval to conduct at any given time. It specifies the activity in relation to which, in making a decision under reg 16, NOPSEMA must be reasonably satisfied that the titleholder is compliant with s 571(2) of the Act.

57    Turning to address TWS’s primary submissions.

58    TWS did not seriously challenge that reg 16 of the Regulations and s 571(2) of the Act are directed to a petroleum activity, but rather submitted that phrases in s 571(2), “in connection with” and “as a result of”, mean there is a broad range of costs, expenses and liabilities that prima facie arise for consideration under s 571(2). TWS accepted the precise scope of the phrases depends on the statutory context in which they appear. It submitted “in connection with” is an expression of wide connotation that merely requires a relation between one thing and another. It does not necessarily require a causal connection between the matters. In that context, TWS submitted that the disjunctive use of those phrases confirms their expansive scope, especially when read together with s 571(2)(b) and (c). Therefore, it was said the financial assurance obligation extends beyond the costs, expenses and liabilities directly connected with carrying out a petroleum activity. Rather, it extends to acts or omissions which are not part of the activity itself but are done for the purposes of the activity or form part of complying, or failing to comply, with a legislative requirement in relation to the activity. TWS’s “critical” submission is that this extends to costs, expenses and liabilities arising as a consequence of such acts or omissions.

59    TWS also focussed on the meaning of the phrase petroleum activity, which it submitted is a broad term that picks up the obligations imposed by the Act in relation to decommissioning the projects under the WA-41-L and WA-18-PL licenses. It submitted that in s 571, the phrase has the meaning given by reg 5 of the Regulations, being operations or works in an offshore area undertaken for the purpose of exercising a right conferred under the Act by a petroleum title, or discharging an obligation imposed on a petroleum titleholder by the Act or a legislative instrument under the Act. In that context, TWS submitted the Act imposes, or contemplates the imposition of, the following obligations relevant to the decommissioning of the Reindeer facilities on Santos as a registered titleholder:

(1)    Santos must remove from the title area “all structures that are, and all equipment and other property that is, neither used nor to be used in connection with the operations: (a) in which [Santos] is or will be engaged; and (b) that are authorised by the permit, lease, licence or authority”: s 572(3);

(2)    Santos is not able to surrender its titles unless it has complied with the requirement in (1) and, to the satisfaction of NOPSEMA, removed all property, plugged or closed off all wells, conserved and protected natural resources, and made good any damage to the seabed or subsoil in the surrender area: s 270(3)(b)(iii), (c)-(f);

(3)    NOPSEMA and the responsible Commonwealth Minister may give Santos a direction as to the “removal from an offshore area of structures, equipment and other items of property that: (a) have been brought into the offshore area for or in connection with exploring for, or exploiting, petroleum; and (b) are not used, or intended to be used, in connection with exploring for, or exploiting, petroleum in the offshore area”: s 782(1) item 13, and see ss 574(2) and 574A(2); and

(4)    NOPSEMA and the responsible Commonwealth Minister may give “remedial directions” in relation to the removal of property, the plugging or closing off of wells, the conservation and protection of natural resources, and the making good of damage to the seabed or subsoil: ss 586-587A.

60    TWS submitted that for the purposes of s 571, a “petroleum activity” includes operations or works in an offshore area undertaken for the purpose of discharging the obligations imposed under (1) and (2) above, and any obligation imposed pursuant to a direction in the nature of (3) and (4) above.

61    The import of TWS’s submission is that s 571(2) of the Act imposes on a titleholder a continuous obligation, while the title is in force, to “maintain financial assurance sufficient to satisfy decommissioning costs”, and every environment plan, regardless of the petroleum activity it seeks to have approved, must include a financial assurance covering decommissioning costs. That is said to arise because of the inevitability of decommissioning being required, with the obligation imposed principally by s 572.

62    I accept the phrases “in connection with” and “as a result of” can have a broad coverage. However, such phrases have been described as having “chameleon-like quality” such that each “gathers meaning from the context in which it appears and it is the context which will determine the matters to which it extends”: Commissioner of Taxation v Scully [2000] HCA 6; (2000) 201 CLR 148 at [39] and [59], quoting Technical Products Pty Ltd v State Government Insurance Office (Q) [1989] HCA 24; (1989) 167 CLR 45 at 47. As TWS acknowledged, the context in which the phrases are used is critical to their meaning. I note also that in this context Santos referred to R v Khazaal [2012] HCA 26; (2012) 246 CLR 601, emphasising [31]:

The nature and breadth of the relationships they cover will depend upon their statutory context and purpose. Generally speaking, it is not desirable, in construing relational terms, to go further than is necessary to determine their application in a particular case or class of cases. A more comprehensive approach may be confounded by subsequent cases.

63    TWS’s submission is that the costs, expenses and liabilities for which financial assurance must be provided extend to acts or omissions which are not part of the petroleum activity, but part of the titleholder complying with a legislative requirement under the Act. That proposition was said by TWS to apply regardless of the nature of the activity for which the environment plan sought approval.

64    TWS accepted its submission is that s 571 requires decommissioning costs to be assured, even when a decommissioning activity is not the subject of the environment plan. In pre-hearing correspondence between the parties, TWS described that its “case is that s 571(2) of the [Act] will always extend to decommissioning costs”, and a titleholder must maintain financial assurance for those costs, “at least with respect to … licences such as WA-41-L and WA-18-PL”.

65    Although TWS accepted in its written submission in reply that reg 16 and s 571(2) are fixed by reference to a particular petroleum activity, as apparent from the discussion below, that acceptance is not reflected in the premise of its submission (and see the discussion of the new case above).

66    The broad reach of TWS’s submission is illustrated by TWS’s response to Santos’ example of an environment plan seeking approval for a seismic survey. This activity falls within the definition of petroleum activity, and therefore requires approval from NOPSEMA. Santos submitted the consequence of TWS’s construction is that if a titleholder sought approval in an environment plan to conduct a seismic survey over part of a title area where there are production wells and a pipeline present, NOPSEMA could only authorise this if reasonably satisfied that the titleholder was capable of meeting all the costs of fully removing the wells and the pipeline from title. That is, the existence of structures on the title triggers the financial assurance obligation in s 571(2) to include the costs of decommissioning all of those structures. TWS accepted that was the consequence of its construction, but submitted this did not tell against its correctness. TWS did not adequately explain why the example of a seismic study did not undermine the correctness of its interpretation, or how that example fit within its construction. TWS maintained its submission that, including in respect of that example, s 571(2) picks up the obligation in s 572(3) in relation to decommissioning. This illustrates the breadth of its submission and the consequences that arise from its construction of the statutory scheme.

67    For the reasons below, I do not accept TWS’s submission.

68    First, as NOPSEMA submitted, the context in which the relational phrases are to be construed includes, as explained above, that s 571(3) contemplates, and the Regulations provide, for NOPSEMA to evaluate whether compliance with s 571(2) has been demonstrated in relation to the particular petroleum activity that has been described in an environment plan. TWS’s submission fails to grapple with the focus of s 571 being directed to “a petroleum activity” and “the petroleum activity”, and in reg 16(1), on NOPSEMA not accepting an environment plan for “a petroleum activity” unless it is reasonably satisfied the titleholder is compliant with s 571(2) of the Act “in relation to the petroleum activity”.

69    The chapeau to s 571(2) uses the relational connectors “arising in connection” and “as a result of”, in respect of the costs, expenses and liabilities of the particular petroleum activity that is the focus of the environment plan (emphasis added). That is: in (2)(a), of carrying out the activity; in (2)(b), of doing the activity; and, in (2)(c), complying with a requirement in relation to the activity. The relational connectors are confined to the extant carrying out, doing, or compliance with a requirement, in relation to a petroleum activity. The scope of reg 16(1)(a), which requires compliance with s 571(2), is also narrowed by the phrase “in relation to the petroleum activity”.

70    I agree with Santos’ submission that a fair reading of the Act reflects that the costs, expenses and liabilities referred to in s 571 are not at large, but are referrable to the activity or activities sought to be approved in the environment plan. That is consistent with the text of the provision considered in context.

71    Second, as illustrated by its submission in respect to the example of a seismic study, on TWS’s construction of the statutory scheme, the financial assurance requirement does not relate to the petroleum activity for which approval is sought by the environment plan. To the contrary, the nature of the petroleum activity is treated as irrelevant. The submission is inconsistent with the clear terms of s 571 and reg 16 which focus on a specified activity. TWS’s submission that the term environment plan does not appear in s 571(2) is to read the subsection of the provision in isolation. Section 571(2)(c) on which TWS relies “is in relation to the petroleum activity”, which when read in context is the activity the subject of the environment plan. Section 571(3) provides that compliance with s 571(2) “in relation to a petroleum activity to be demonstrated as a prior condition of acceptance of an environment plan for the activity” may be provided by regulation (emphasis added). It follows the identification of that activity is relevant to determining what financial assurance a titleholder is required to maintain while the title is in force. A construction untethered to that activity is inconsistent with the scheme of the Act.

72    Third, TWS’s submission is premised on the proposition that decommissioning will inevitably be required, which is not supported by the provisions it relies on, including s 572 of the Act. This section is directed to maintenance and removal of property by the titleholder. The titleholder must maintain in good condition and repair all structures that are, and all equipment and other property that is: in the title area; and used in connection with the operations authorised by the permit, lease, licence or authority: s 572(2). This creates an ongoing obligation to maintain any structure, equipment or property on title. Section 572(3) addresses removal, requiring that a titleholder must remove from the title area all structures that are, and all equipment and other property that is, neither used nor to be used in connection with the operations.

73    TWS submitted that an obligation in respect to decommissioning arises from the point when any structure, equipment or property is present in the title area, and exists until the requirement in s 572(3) is discharged following its removal. That is, the mere fact of the presence of the structure, equipment or property gives rise to the obligation in s 572(3) to provide financial assurance for decommissioning in respect of it. Section 571(2)(c) therefore requires a titleholder to maintain financial assurance sufficient to meet that liability. That is described by TWS as “a direct connection between carrying out the activity and the need to comply with the requirement in s 572(3)”. That is said by TWS to be “sufficient to be a requirement ‘in relation to’ the activity”.

74    However, the premise of the submission, that decommissioning costs are captured within s 571(2)(c) of the Act, is not established. First, the operation of s 572(3) is subject to s 572(7) of the Act, which is recited above at [24]. I note also that Santos submitted some of the matters listed under s 572(7) to which its operation is subject are of indeterminate reference. The obligation or liability said to arise based on s 572 is therefore not inevitable. That is, the obligation to decommission may not arise at all, if another outcome arises due to one of the matters under s 572(7) to which it is subject. In response to that submission, TWS argued that the likelihood of removal being required is high. However that does not equate to inevitability. Second, the removal obligations in s 572(3) are triggered when the structure, equipment, or property is not used, or not to be used in connection to an authorised activity. The obligation only crystallises on those conditions existing. The obligation does not arise simply because a petroleum activity is to occur on the title. Therefore, contrary to TWS’s submission, the mere fact of the presence of the structure cannot give rise to the obligation in s 572(3). It is difficult to understand how it is contended that s 572(3) provides a “direct connection”, particularly so where on TWS’s case the nature of the activity sought to be approved by the environment plan is irrelevant (e.g. see the example of the seismic study).

75    In the alternative, TWS submitted decommissioning falls within s 571(2)(a) or (b), because it inevitability arises “in connection with” or “as a result of” carrying out a petroleum activity that involves the presence of a structure in the title area. I do not agree. It relies on the premise there is an obligation to remove based on the presence of the structure, equipment, or property, not on the basis of arising in connection with or as a result of, or in relation to, the petroleum activity for which approval is sought in an environment plan. That construction is not supported by the provision. The submission is predicated on the presence of structures, equipment or property on the title, not the petroleum activity for which authorisation is sought. TWS’s construction treats the nature of the activity the particular environment plan seeks to have approved as irrelevant. Further, this submission relies on an interpretation of the terms contained in s 571(2)(a) and (b), not supported by the text of the provision considered in its context. As already discussed at [62], the breadth of the terms is determined by their statutory context.

76    Fourth, TWS submitted that its construction, which extends to decommissioning costs, is coherent with the statutory purpose of the provision.

77    In advancing the submission, TWS submitted, inter alia, that a licence can only be granted, or a fixed-term petroleum production licence renewed, if the Joint Authority (being the responsible State or Commonwealth Minister) is satisfied that the applicant has sufficient financial resources to discharge the obligations that will be imposed under the Act in relation to the licence, such as the obligation in s 572(3): see ss 171(1)(ba) and 173(4A). TWS relied on these provisions to submit the Act evinces a concern with ensuring titleholders cannot engage in petroleum activities unless they have the means to satisfy the costs associated with decommissioning following the conclusion of those activities. It submitted that the construction of s 571(2) for which it contends is entirely congruous with that statutory context and purpose. TWS submitted that its construction ensures that, once a titleholder applies to carry out petroleum activities involving the presence of infrastructure in the title area, it maintains financial assurance sufficient to meet the costs associated with decommissioning that infrastructure. However, as NOPSEMA submitted, the obligation in s 571(2) with reg 16 is distinct from, and more specific than, the provisions of the Act that require consideration of whether a titleholder (or prospective titleholder) has sufficient “financial resources” to discharge the obligations that “will” be imposed under the Act in relation to the title.

78    TWS’s submission also fails to address the text of s 571(2), given its context and purpose.

79    For example, s 571(2), as evident from its terms recited above, provides three examples, by reference to sections of the Act, of costs, expenses and liabilities which are covered. TWS submitted the caveat of “without limitation” indicates the three examples are not exhaustive of the scope of the provision, relying on Commonwealth Bank of Australia v Reeve [2012] FCAFC 21; (2012) 199 FCR 463 at [62]. So much is readily apparent from its terms. Nonetheless, the examples are part of the Act, and therefore part of the statutory context in which the section is to be interpreted: see ss 13(1) and 15AD of the Acts Interpretation Act. An example in an Act may clarify and illustrate the meaning of terms used in a particular statutory provision: Greater Shepparton City Council v Clarke [2017] VSCA 107; (2017) 56 VR 229 at [70]; KDSP v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2020] FCAFC 108; (2020) 279 FCR 1 at [289].

80    The respondents submitted the examples strongly indicate that s 571(2) is intended to cover extraordinary costs, expenses and liabilities, such as those relating to the escape of petroleum as expressly stated in example (a) and (b). TWS agreed that (a) and (b) focus upon extraordinary events, but submitted that the “damage” referred to in (c) could arise from both an extraordinary event, or as a result of activities associated with the ordinary conduct of a petroleum activity. The text of (c) relates to “complying with a direction under section 574 or 586 relating to the remediation of damage to the seabed or subsoil arising in connection with a petroleum activity”. NOPSEMA called in aid the ejusdem generis rule of construction, submitting (c) refers to damage caused by the same kind of events as in (a) and (b). Regardless of whether the process of construction is described by reference to that rule, the text of (c) must be interpreted in its context. Given its context, I agree with the respondents’ submission as to the meaning of (c). Regardless, the examples relate to costs, expenses and liabilities that are not ordinary costs. As such, they are described by NOPSEMA as relating to extraordinary costs.

81    In so far as TWS repeatedly made submissions on the basis that NOPESMA was confining the extraordinary costs, expenses and liabilities to those relating to the escape of petroleum, the submission is incorrect. NOPSEMA did not confine its submission to the escape of petroleum. Rather, example (a) and (b) were used as an illustration of the extraordinary nature of the costs, expenses and liabilities that s 571(2) is intended to cover. Further, although as TWS submitted Parliament could have been expressly stated it was limiting the costs, as NOPSEMA submitted, equally, it could have provided financial assurance is required over the life of the title for future decommissioning, which it has not done.

82    Although the examples are without limitation, their nature provides some indication of the mischief the provision is intended to address. As explained below, this is also supported by the extrinsic material relevant to the provision.

83    Fifth, contrary to TWS’s contention, I do not consider that the legislative history of s 571 supports its construction of the provision. Rather, the extrinsic material is consistent with the respondents’ construction that the section is focussed on the activity in the environment plan which is sought to be approved. TWS relied on the legislative history to argue the term petroleum activity is intended to include decommissioning activities. It also relied on it to argue s 571(2) is not confined to escape of petroleum events although, as explained above, that submission is based on a misinterpretation of NOPSEMA’s case.

84    Section 571 was introduced in 2013 in the Offshore Petroleum and Greenhouse Gas Storage Amendment (Compliance Measures No 2) Act 2013 (Cth) (2013 amendments).

85    The relevant Explanatory Memorandum, describes, inter alia, that s 571 would “provide for NOPSEMA to manage compliance via the environment plan acceptance process under the regulations”: at page 41. It also explained (at page 42) that:

Subsection 571(3) provides for the administrative mechanisms that will be put in place for NOPSEMA to oversee compliance by a titleholder with its obligation in subsection (2). Subsection (3) provides that the Environment Regulations may provide for a titleholder to be required to demonstrate sufficient financial assurance as a condition precedent to obtaining NOPSEMA’s acceptance of the environment plan for the relevant activity. The regulations may also require that the financial assurance be in a form that is acceptable to NOPSEMA. (This is to ensure, for example, that NOPSEMA is not required to accept financial assurance that is unworkably complex or piecemeal or that is too difficult to assess.) The regulations may also make a failure to maintain sufficient financial assurance in a form acceptable to NOPSEMA (essentially, the package that has been accepted by NOPSEMA) to be a ground for withdrawal of acceptance of the environment plan.

86    I accept NOPSEMA’s submission that the Explanatory Memorandum reflects that compliance with s 571(2) is an evaluative matter for NOPSEMA which is tied to the acceptance of an environment plan for the activity: see s 571(3)(a).

87    TWS also submitted the Explanatory Memorandum does not expressly state that s 571(2) is confined to “extraordinary costs, expenses and liabilities” or that it excludes decommissioning costs, expenses and liabilities. This was relied on by TWS in support of its submission that NOPSEMA determined to accept the Reindeer EP on a basis that misconstrued s 571(2).

88    Pausing there. It is difficult to understand how TWS’s submission that 571(2) extends beyond extraordinary costs, or does not exclude decommissioning costs, assists it in establishing the underlying premise of its construction. That is, that decommissioning is a requirement or obligation under the Act (within s 571(2)(c)), such that a titleholder is required to include decommissioning costs in relation to all structures on its title in its financial assurance pursuant to s 571(2), in relation to environment plans, irrespective of the petroleum activity the subject of the plan (as illustrated by the seismic study example). The submission does not assist it in establishing the obligation for those decommissioning costs or the relationship between this, and the petroleum activity the subject of the environment plan for which acceptance is sought.

89    Nonetheless, while addressing the extrinsic material, in light of the submissions made by the parties, I make the following observations.

90    The relevant Explanatory Memorandum for the 2013 amendments states:

Financial assurance

The Bill will also amend the existing insurance provisions in the Act to clarify the operation of those provisions, in order to support the application of the ‘polluter pays’ principle in the offshore petroleum regulatory regime by reinforcing that the obligation for managing operational risks rests with the titleholder. The amendments will ensure that it is compulsory for a titleholder to maintain sufficient financial assurance to ensure that it can meet the costs of any expenses or liabilities arising in connection with work done under the title, including expenses relating to the clean-up or other remediation of the effects of an escape of petroleum.

These amendments collectively implement and address the matters raised in Recommendations 95 and 96 of the Montara Report.

…

As is apparent from the Examples provided in subsection (2), financial assurance is required to deal with extraordinary costs, expenses and liabilities that a titleholder might not have the capacity to meet. It is not expected to cover ordinary expenses of a titleholder in meeting ordinary operating costs, such as the costs of compliance with title conditions.

91    The Second Reading Speech states:

The bill clarifies existing insurance provisions, ensuring that it is compulsory for a titleholder to maintain sufficient financial assurance to meet any expenses or liabilities arising in connection with work done under the title following an escape of petroleum and also with other extraordinary regulatory costs they might incur. Financial assurance is required to deal with extraordinary costs, expenses and liabilities that a titleholder might not have the capacity to meet. It is not expected to cover ordinary expenses of a titleholder in meeting ordinary operating costs, such as the costs of compliance with title conditions.

The polluter pays and financial assurance amendments collectively implement and address the matters raised in recommendations 95 and 96 of the report of the Montara Commission of Inquiry. ….

92    As is readily apparent in these extrinsic materials, s 571 was introduced together with the “polluter pays” provisions in Part 6.1A of the Act. They are to implement and address the matters raised in Recommendations 95 and 96 of the Montara Commission of Inquiry (Commonwealth of Australia, June 2010):

Recommendation 95

The regulatory framework should provide that in respect of all activities in Commonwealth waters:

a.    there are powers to require companies involved in an incident causing significant environmental damage to undertake actions to remediate the damage to a standard determined by the regulatory authorities

b.    the nature of the Scientific Monitoring and the remediation required should be determined by environmental regulatory agencies rather than the companies involved;

c.    the costs of all Scientific Monitoring and remediation should be fully borne by the companies involved, whether the remediation is undertaken by the companies or another party to the standard determined by the regulatory authorities; and

d.    penalties should be payable for pollution on a no fault basis.

The EPBC Act should be amended to include the powers in a, b, c and d above. These powers should be applicable to both prospective and existing operations in Commonwealth waters.

Recommendation 96

The obligation of companies involved in an incident to meet the full costs of monitoring and remediation should be made a condition of approval of proposals under the EPBC Act and OPGGS Act. Suitable arrangements (insurance or otherwise) need to be in place to ensure that companies have this capacity.

93    As NOPSEMA submitted, the extrinsic materials single out what Parliament intended to be the subject matter of s 571(2): see Bayside City Council v Telstra Corporation Ltd [2004] HCA 19; (2004) 216 CLR 595 at [42]-[43] (and see Palmanova recited above at [46] – [47] as to the use of extrinsic material). The extrinsic material is consistent with the construction of the Act as contended for by the respondents. In particular, it is consistent with the respondents’ submission as to the construction of the examples provided in s 571(2) (as discussed above). As already explained, the phrases “in connection with” and “as a result of” take meaning from their context. As NOPSEMA submitted, that context here includes the examples listed under s 571(2) and statements made in the Explanatory Memorandum and Second Reading Speech for s 571. I accept NOPSEMA’s submission that the provision, considered in context, and given its purpose, supports that it is open to it to be satisfied that a titleholder has “demonstrated” compliance with s 571(2) if the titleholder provides evidence that it has financial assurance sufficient to meet “extraordinary” costs of the kind mentioned in the Explanatory Memorandum and Second Reading Speech for s 571.

94    Finally, as explained above, NOPSEMA submitted the consequence of TWS’s submission is that decommissioning would need to be accounted for by the titleholder in terms of financial assurance when submitting an environment plan for any activity, even an activity that is not decommissioning. For example, the first environment plan for the initial phase of operation would have to provide evidence of financial assurance for decommissioning, even though decommissioning is not the subject of the initial plan and is not required to be described under reg 21 of the Regulations. Decommissioning might take place at an indefinite point in the future, when environmental sensitivities and matters associated with decommissioning are not yet clearly known. The financial assurance would then need to be replicated each time an environment plan is submitted for the purpose of the next phase of the project, because at the ultimate end stage, decommissioning may need to occur. That requires long range, speculative, and duplicative work. I agree that is an unlikely construction.

95    While TWS accepted there are uncertainties involved in estimating the quantum of decommissioning costs at an early stage in a project, it submitted this does not render an obligation to maintain financial assurance for decommissioning costs after completion of the relevant petroleum activity unworkable or unable to be demonstrated. For example, TWS submitted it may be equally difficult to speculate on how much it will cost to clean up an oil spill before it has not occurred, however a titleholder is required to give financial assurance for this.

96    However, the Reindeer EP illustrates the impracticality of the submission. As already mentioned, TWS has not challenged NOPSEMA’s finding that this environment plan does not address decommissioning. Further, the triggering condition in s 572(3) of the Act had not arisen at the stage of this environment plan being submitted. Nonetheless there is reference in the Reindeer EP to preparation for the end of life of the project, which includes two concrete proposals as to possible future repurposing of the facilities in question. As Santos submitted, TWS’s submission is that the statutory scheme requires a titleholder to first cost out and then assure the costs of steps it does not presently intend to take, is not authorised to take, and may never take place as there are lawful options available to the titleholder that may result in different outcomes on the title. In the case of the Reindeer EP, Santos submitted a decision may be made to repurpose or decommission all or part of the facilities, illustrating the challenges of quantifying and providing financial assurance at an early stage in the project. To the extent that TWS submitted titleholders, including Santos, estimate decommissioning costs for their financial statements, those estimates are made for a different purpose.

97    Santos referred to Santos NA Barossa Pty Ltd v Tipakalippa [2022] FCAFC 193; (2022) 296 FCR 124 at [89] where the Court in respect to reg 11A from a different set of Regulations made under the Act, determined:

Regulation 11A, like most statutory consultation provisions, imposes an obligation that must be capable of practicable and reasonable discharge by the person upon whom it is imposed.

(emphasis added)

98    Santos relied on the emphasised passage to submit, in effect, the construction sought by TWS would impose an obligation which is not practical or reasonable. The procedures and the economics to fulfil the obligation imposed by the Regulation must be practicable. That may be accepted. That tends against reading the statutory scheme as imposing the obligation for which TWS contends.

99    For the reasons above, the text of s 571(2) of the Act, considered in context, and given its purpose, does not support TWS’s submission. It does not support the contention that decommissioning costs fall within s 571(2) for every environment plan if the titleholder has structures, equipment or property in the title area, for the purposes of NOPSEMA considering whether, pursuant to reg 16, it is satisfied of the conditions to accept the environment plan (regardless of the petroleum activity sought to be accepted).

100    Rather, s 571(2) together with reg 16 focus on the petroleum activity the subject of the environment plan for which acceptance by NOPSEMA is sought. That is, NOPSEMA is required to consider whether an environment plan is compliant with s 571(2) of the Act in relation to the petroleum activity the subject of the plan.

101    Returning to this application.

102    It will be recalled that TWS in its sole ground of review alleges NOPSEMA misconstrued s 571(2) as not requiring a financial assurance to deal with decommissioning costs, expenses and liabilities, and therefore could not have been reasonably satisfied Santos was compliant with s 571(2) as required by reg 16. That is, TWS submitted the reason NOPSEMA did not require Santos to give a financial assurance in relation to decommissioning costs was because of a view that s 571(2) extends only to “extraordinary” costs, expenses and liabilities. I do not agree.

103    Given the construction of s 571(2) and reg 16 as addressed above, and NOPSEMA’s reasons, the better view is that the delegate considered that decommissioning was not an activity the subject of the Reindeer EP, and therefore did not need to be assessed in reaching the state of reasonable satisfaction required by reg 16.

104    As apparent from its reasons, NOPESMA concluded that the scope of the activity the subject of the Reindeer EP did not include decommissioning activities. That finding was not challenged. I accept the respondents’ submission that in making the decision under review, the delegate was only required to consider whether Santos was compliant with s 571(2) of the Act “in relation to the petroleum activity” the subject of the Reindeer EP. Decommissioning was not a petroleum activity that was the subject of the Reindeer EP. TWS has not established that decommissioning costs were costs “arising in connection with, or as a result of”, any of the matters prescribed in s 571(2)(a)-(c) in relation to the petroleum activity the subject of the Reindeer EP. Decommissioning costs did not fall within the financial assurance provisions for the purposes of deciding whether to accept the Reindeer EP.

Conclusion

105    TWS has not established that NOPSEMA failed to consider decommissioning costs in considering whether it was satisfied that Santos was compliant with s 571(2), on the basis of a misconstruction of s 571(2) of the Act.

106    Accordingly, the ground of review is not established. The application is dismissed with costs.

Associate:

Dated:    7 August 2026