The Australasian Centre for Corporate Responsibility (ACCR) filed a statement of claim in the Federal Court on Wednesday outlining its argument that Santos’ annual report makes false claims about the company’s approach to addressing climate change.
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| Santos has been hit with a lawsuit over allegedly misleading and deceptive conduct related to its environmental credentials. Credit: Bloomberg |
One of the ACCR’s key claims is that Santos refers to natural gas as a “clean fuel” and it provides “clean energy”, according to a statement released by the group on Thursday.
“The annual report fails to disclose that the extraction, processing and use of natural gas releases significant quantities of carbon dioxide and methane into the atmosphere, gases which are key contributors to climate change and global warming,” the ACCR said.
The group is also taking aim at Santos’ claims to have a clear pathway towards reaching net zero emissions by 2040, an aspiration which relies on the development of carbon capture and storage technology and blue hydrogen.
“ACCR alleges that Santos failed to disclose that it has firm plans to increase its greenhouse gas emissions by developing new or existing oil and gas projects including in the Barossa, Dorado and Narrabri LNG projects,” its statement said.
“This calls into question whether Santos had reasonable grounds to assert it has a ‘clear and credible’ plan to reach net zero emissions by 2040.”
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“Investors have a right to complete, open and honest information relating to a company they are investing – or considering investing – in.
"Accurate information about how the global energy transition towards net zero emissions may impact Santos’ future financial prospects is critical to investors’ ability to assess the viability of their investment and their financial and reputational exposure,” ACCR said.
Environmental Defenders Office (EDO) solicitor Zoe Bush said the lawsuit was a “world-first” designed to “challenge the accuracy of corporate net zero emissions targets, as well as the first in Australia concerning potential greenwashing by the oil and gas industry”.
The Age and Herald have also reported this week that investors are seeking to short sell carbon heavy stocks, which could become more attractive with the rise of climate litigation.
Australian Ethical head of research Stuart Palmer said the opportunity to profit from so-called ‘green-shorting’ could grow after a number of ‘catalysts’ in the transition to clean energy are passed, including the rise of climate litigation.
A Santos spokesman said in a statement: “It would not be appropriate for Santos to comment on matters before the court.”
MST Marquee analyst Mark Samter said the ACCR’s lawsuit was ideological and simplistic and queried the activist focus on fossil fuel producers, rather than consumers.
“If you permanently banned air travel you could reduce global oil demand by around 10 per cent. If you banned the production of petrochemicals, yes you would struggle to supply many medicines, clothes and most other household goods, but you could reduce oil demand by around 15 per cent.”
Mr Samter said fossil fuel producers needed to be included in the ‘just’ transition to clean energy, rather than “trying to eradicate them off the face of the planet”.
“I would argue Santos is streets ahead of peers with its transition strategy, albeit undoubtedly risks remain around it,” he said.
Santos’ share price fell by 1.95 per cent on Thursday to close at $6.04 per share.
Links
- Australasian Centre for Corporate Responsibility
- Australasian Centre for Corporate Responsibility files landmark case against Santos in Federal Court
- Santos
- Santos 2001 Annual Report
- Global carbon tax could turbocharge ‘green shorting’, ethical funds say
- Bushfire Survivors Take Action Over NSW Climate Policy
- (Legal) Climate Change Cases Doubled Past Six Years
- (AU ABC Law Report) Climate Change Litigation
- Lethal Heating: Legal Posts
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