The Federal Court of Australia has dismissed a legal challenge brought by the Australasian Centre for Corporate Responsibility (ACCR) against Santos, finding the oil and gas company did not engage in misleading or deceptive conduct. The court awarded costs to Santos.

Details of the Legal Challenge

The ACCR commenced proceedings in August 2021, alleging Santos made misleading statements in its 2020 Annual Report, 2021 Climate Change Report, and a 2020 Investor Day presentation. The specific claims challenged included Santos's assertions that natural gas is a "clean fuel," that it could produce "zero emissions hydrogen," and that its 2040 Net Zero Roadmap was a "credible" and "doable" plan to achieve net zero Scope 1 and 2 emissions.

Santos's Response and Climate Actions

Santos welcomed the decision, reiterating its commitment to transparent and compliant reporting. The company stated its climate transition action plan has evolved since the 2020 roadmap's publication. It highlighted the Moomba carbon capture and storage (CCS) project, which became operational in September 2024, as a key deliverable. Santos described Moomba CCS as one of the world's largest and lowest-cost CCS projects, with a capacity to store up to 1.7 million tonnes of CO2 equivalent annually, equating to significant real emissions reductions.

ACCR's Perspective on the Ruling

Despite the loss, the ACCR's co-chief executive, Brynn O'Brien, characterized the case as a landmark that paved the way for challenging corporate net-zero claims globally. O'Brien stated that evidence presented during the trial exposed "reverse-engineering of emissions numbers" within Santos to meet executive demands, which she argued should reinforce investor concerns about corporate leadership and culture.

Investor Support and Next Steps

Contrasting the ACCR's concerns, over 85% of voted shares supported Santos's climate transition action plan at the company's 2025 AGM during a 'Say on Climate' vote. The detailed reasons for Justice Brigitte Markovic's ruling are scheduled to be released on 23 February, following a review by Santos and its legal advisors for potential redactions of commercially sensitive information.