15/10/2008 - 22:00

Gas compo claims possible

15/10/2008 - 22:00

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KEY industry bodies are gearing up their preparations for proposed compensation claims following the release of the official report into the Varanus gas explosion, handed down last week by Mines and Petroleum Minister Norman Moore.

Gas compo claims possible

KEY industry bodies are gearing up their preparations for proposed compensation claims following the release of the official report into the Varanus gas explosion, handed down last week by Mines and Petroleum Minister Norman Moore.

The National Offshore Petroleum Safety Authority report criticised the operator, Apache Energy, for ineffective protection, and inadequate inspections of its pipelines, and also found the Department of Industry and Resources failed in its monitoring of the company's procedures.

Industries across the state have been greatly affected by the explosion, which cut gas supplies by a third and cost Western Australian businesses an estimated $2.4 billion.

Various representative groups are now taking steps to assess how badly their members were affected and are keen to ramp up plans for possible legal action.

Two weeks ago, Forest Industries Federation executive director, Bob Pearce, told WA Business News a joint class action was possible.

This week, Mr Pearce will speak with his members to quantify their losses and plan the next step to take.

"After consulting with my members I'll look around to see what other groups might be in a similar situation," he said.

"I've had a couple of approaches from a couple of groups and individuals as a result of the publicity, but I haven't done anything formal in terms of consulting with other people. "I saw...that the Housing Industry Association is expressing interest, and everyone is in the process of looking at the report and seeing what the government does."

HIA media and government relations director, Steven Gill, said it was the manufacturers and suppliers in his membership who were hit the hardest.

"They certainly had increased cost of production during that period," Mr Gill told WA Business News.

"Energy was costing more, there's no doubt about that, and those manufacturers and suppliers, to my knowledge, absorbed the increased costs.

"I think everyone is circling the wagons, looking at the reports, sticking the finger out to see how the wind is blowing because, certainly, it did cost them money.

"There's no doubt about that, it cost lots of money which they were unable to recoup from the building sector."

Prime Laundry general manager, Robert Dube was hit especially hard for a relatively small company, and is very keen to pursue a joint bid for compensation.

"As a collective thing we're definitely interested in being part of it," Mr Dube said.

"On an individual basis on our side there's no way we can take on the likes of Apache.

"The list (of affected industries) is endless, and we're one of the cheap ones.

"There's mining companies that lost $10-20 million so we're a small fish in a big pond."

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