Santos Fined $120,000
A coal seam gas (CSG) company now owned by Santos was recently convicted and fined for a safety breach during underground drilling work which resulted in a fatality.
In September 2013, in the matter of Nash v Eastern Star Gas Ltd [2013] NSWIRComm 75, the company (acquired by Santos in November 2011) was convicted and fined $120,000 for a breach of the then Occupational Health and Safety Act which arose from a 2009 incident at a work site.
A work crew installing underground pipe work was using a horizontal directional drilling machine. During the process, a pipeline became stuck. Attempts were made to retrieve the pipe by using a chain attached to an excavator to drag the pipe free.
During the process, the chain between the excavator and the pipe failed and the pipe, whilst recoiling, came into contact with one of the workers, causing fatal injuries.
Eastern Star Gas was the nominated operator of a petroleum assessment lease and a petroleum exploration licence granted pursuant to the NSW Petroleum (Onshore) Act for land near Narrabri, in NSW. These activities are managed by the Department of Trade and Investment of NSW, which also investigated the incident and commenced these prosecution proceedings.
The contractor Austerberry Directional Drilling Services Pty Ltd was also prosecuted for a breach of the then OHS Act and received a conviction and fine in the amount of $170,000 from the Industrial Court of NSW in May 2013. (See Nash v Austerberry Directional Drilling Services Pty Ltd [2013] NSWIRComm 37.)
Companies in the CSG industry must comply with safety requirements of the WHS Act which has broadened the application of the safety laws, so that the business or undertaking (PCBU) is required to ensure, as far as reasonably practicable, that the health and safety of persons are not put at risk from the work carried out.
Officers of a PCBU are also required to have an effective due diligence system in place to ensure that safety is being properly managed for the business activities of the PCBU and that a best practice safety management system is in place.
