Australia’s second-largest independent oil firm, Santos, is facing a lawsuit from the Australasian Centre for Corporate Responsibility (ACCR), accused of misleading consumers about its decarbonization goals. This case marks a significant moment in the ongoing battle against greenwashing in the oil and gas industry.
The ACCR, a shareholder activist group, purchased shares in high-emission companies to push them toward achieving targets outlined in the Paris Climate Agreement. This lawsuit is the first of its kind in Australia and could set a precedent for future legal actions against oil and gas companies globally.
The trial, which began Monday and is set to last 13 days, stems from a 2021 complaint alleging that Santos misrepresented its plans to reduce emissions by 26% to 30% by 2030 and achieve net-zero emissions by 2040. The ACCR claims these statements are misleading and violate Australian corporate and consumer laws.
ACCR lawyer Noel Hutley stated, “We’ll be submitting that Santos lacked reasonable grounds for making these statements,” asserting that the company’s climate strategy was merely speculative rather than a comprehensive plan for decarbonization. The ACCR has also cited instances where Santos referred to natural gas as a “clean fuel” and labeled blue hydrogen—produced using fossil fuels—as “clean” and “zero emissions.”
Santos has claimed that its net-zero ambitions rely heavily on carbon capture and storage (CCS) technology, which it aims to deploy while expanding oil and gas production. However, the ACCR contends that Santos has not adequately disclosed critical assumptions and qualifications related to its CCS processes. Dan Goucher, ACCR’s Director of Climate and Environment, emphasized the difficulty investors face in distinguishing between genuine and misleading claims from companies.
Santos, valued at approximately $22 billion, operates in Australia, the U.S., Papua New Guinea, and Timor-Leste. The outcome of this trial is being closely monitored by global activist groups, who hope it will compel oil and gas companies to enhance transparency regarding their environmental impacts and climate efforts. The ACCR seeks a court ruling to prevent Santos from engaging in deceptive practices in the future and to mandate corrective disclosures regarding the environmental impact of its operations.
This lawsuit follows similar actions in other regions. Earlier this year, California Attorney General Rob Bonta filed an amended complaint against major oil and gas companies, including BP, Chevron, and ExxonMobil, alleging deceptive practices and greenwashing. Bonta accused these firms of using terms like “clean” and “green” to mislead consumers about the environmental friendliness of their products.
In Italy, oil major Eni faced legal action last year for allegedly knowing about climate risks as early as the 1970s while continuing to promote fossil fuel production. Environmental groups accused Eni of lobbying for increased fossil fuel production despite its awareness of potential climate crises.
A wave of lawsuits targeting oil and gas companies is emerging worldwide, as environmental organizations and activists push for accountability. They are demanding clear restrictions on misleading language and urging companies to develop viable decarbonization strategies with transparent policies and measurable targets for achieving climate goals.
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