Gas producer Santos faces new climate claim in landmark greenwashing case

Activists launching one of the world’s first legal challenges over corporate greenwashing have expanded a case against gas producer Santos Ltd., raising new allegations about the company’s climate plans.

A lawsuit filed against the oil and gas producer is the first time a major company has been challenged over the detail of emissions reduction targets, according to the Australasian Center for Corporate Responsibility, the activist shareholder group that launched the action last year.

Details gleaned during the legal discovery process, which gave the ACCR access to additional internal Santos documents, have raised new questions about the company’s promises to use carbon capture technology and blending natural gas with hydrogen to meet climate targets, said group chief executive Brynn O,” Brien said in a statement.

Santos declined to comment.

Adelaide-based Santos has pledged to cut Scope 1 and 2 pollution by 30% by 2030 and eliminate such emissions by 2040, according to a March climate change report. The ACCR case, filed in the Federal Court of Australia, concerns a previous briefing and documents outlining the company’s strategy.

Those proposals relied heavily on unproven carbon capture technology and overestimated the potential for reducing emissions by blending hydrogen into the natural gas grid, according to the ACCR. “Documents produced by Santos reinforced our concerns that these plans lacked sufficient detail to bring to market,” O’Brien said.

The case is being watched closely as a major test of greenwashing – dubious claims made by companies or institutions about their planned climate actions or environmental responsibility. Activists are increasingly trying to hold big polluters to account in an attempt to mitigate the worst impacts of global warming. Last year, Royal Dutch Shell Plc was ordered by a Dutch court to cut emissions more than twice as fast as originally planned.

Accurate information about what actions companies plan to take to reduce emissions is crucial, said Zoe Bush, senior counsel at the Office of Environmental Defenders, which acts for the ACCR, in the statement. Misleading details could “leave investors vulnerable to significant losses and potentially unfairly distract the market from companies that act responsibly,” she said.

Australia is the most contentious nation after the United States as activists try to force change in the major fossil fuel producer, widely seen as a laggard on climate issues. So far, results have been mixed. While some companies have settled lawsuits over misdisclosure of risk, the Federal Court this year overturned a ruling that Canberra has a duty to protect its young people from climate change, saying it was a matter of high public policy and not a matter of the courts.

–With the help of James Fernyhough.

Photograph: The operations of Santos Ltd. are seen in Moomba, South Australia. Photo credit: Bloomberg

Copyright 2022 Bloomberg.

The most important insurance news, delivered to your inbox every working day.

Receive the trusted insurance industry newsletter

Comments are closed.