Acciona in East Rockingham project dispute

Acciona and the owners of the $511 million East Rockingham Waste to Energy plant have returned to court over alleged unpaid bonds.

The project’s owners, an alliance that includes Masdar Tribe Energy and John Laing, sued Acciona in the Federal Court of Australia’s Western Australian registry, alleging the Spanish multinational has failed to pay replacement bonds.

Speaking before Federal Court judge Michael Feutrill today, barrister Kanaga Dharmananda, on behalf of the East Rockingham project owners, objected to giving Acciona a long time to lodge its statement.

“It’s an important project because it’s technically complicated and rare that the project is built in this part of the world,” Mr Dharmananda said.

“There’s an urgency to Acciona’s failure to provide the replacement bonds.”

Acciona lawyer Tom Porter told the court his client was in the middle of engaging a senior counsel to the case but was waiting to clear an issue.

This is not the first legal dispute between Acciona and the East Rockingham plant owners.

In 2023, the plant owners alleged Acciona and Hitachi Zosen have breached the contract and engaged in unconscionable conduct by locking out workers from the project site.

“This is not new. This dispute has been brewing,” Justice Feutrill said in court.

The East Rockingham Waste to Energy plant is slated to open this year but has been hit by delays since construction started in 2010.

The project’s owners, through a consortium, awarded an engineering and construction contract to Acciona in 2020.

Once up and running, the East Rockingham plant has been projected to process 300,000 tonnes of residual waste a year.

Acciona engaged Swiss technology provider Hitachi Zosen as partner on the contract.

Mr Dharmananda told the court Hitachi Zosen, as the fourth and fifth defendants in the matter, have already provided their part of the bond.

“The fourth and fifth respondents have the unfortunate position to being tied hand in hand with Acciona,” he said.

“They’ve been dragged along because of the conduct of Acciona.”

Speaking to the court, Mr Porter said while the matter involved bank bonds, it was just a commercial breach case.

“The applicant both wants the bank bond and to be entitled to immediately call (for) it. They just want to hold on to it,” he said.

In court, Mr Dharmananda flagged an unconscionability issue, claiming Acciona extracted legitimate leverage in the process.

“We don’t see this as a simple commercial breach case. It’s a continuing breach of some significance,” he said.

“The failure to provide the replacement back guarantee is a breach of the declaration.”

The parties are set to appear again before the Federal Court on April 19.