28/05/2009 - 14:27

State starts proceedings against Apache

28/05/2009 - 14:27

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The state government will prosecute oil and gas producer Apache Corporation for failing to maintain and repair a gas pipeline at its Varanus Island facility that exploded last year.

The state government will prosecute oil and gas producer Apache Corporation for failing to maintain and repair a gas pipeline at its Varanus Island facility that exploded last year.

The proceedings come days after the Federal Court ruled in Apache's favour to block the Department of Mines and Petroleum (DMP) from giving information it had obtained from an investigation into the explosion to a federal-state inquiry.

The court found that sharing the information was not permissable under the State Act.

The Varanus Island blast in June last year cut the state's gas supply by one-third and wreaked havoc on the state's industries.

Mines and Petroleum Minister Norman Moore today said the government had started proceedings to prosecute Apache Corporation's wholly owned subsidiary Apache Northwest and its co-licensees Kuwait's Kufpec Australia Pty Ltd and Tap Oil's Harriet joint venture arm, Tap Oil Harriet Pty Ltd.

A charge filed in the Federal Court yesterday alleged the three companies did not maintain the pipeline in good condition and repair as required under the petroleum pipelines act, Mr Moore said.

"It is alleged that the 12-inch sales gas pipeline was corroded in the area of the pipeline rupture which occurred at the pipeline beach crossing on Varanus Island on June 3 last year," Mr Moore said in a statement.

Mr Moore said the charge followed further investigation by the DMP after the release of the initial investigation report by the National Offshore Petroleum Safety Authority (NOPSA) last year.

NOPSA's October report found that Apache may have committed offences under two pipeline acts.

The report said the explosion was the result of ineffective anti-corrosion coating, insufficient protection of a transition zone of the beach section of the pipeline, and not enough inspection and monitoring of the 17-year-old pipeline.

The DPM investigation is expected to be completed next month while the inquiry is being finalised.

An Apache spokesperson told WA Business News that the company will be vigorously defending the charges and added that "the explosion was an unfortunate and unforeseeable event".

The three companies face maximum penalties of $50,000 each if found to be at fault.

Repairs at the Varanus Island facility is currently in its final phase with production at over 90 per cent of the pre-incident rate, the spokesperson said.

Full production is expected to be reached within the next few weeks.

 

 

 

 

The announcement is below:

 

Mines and Petroleum Minister Norman Moore today announced the State Government had started proceedings to prosecute Apache Northwest and its co-licensees in relation to the Varanus Island incident.

Mr Moore said the charge filed in the Federal court yesterday alleged that Apache NW and the co-licensees did not maintain the pipeline in good condition and repair as required by s.38(b) of the Petroleum Pipelines Act 1969.

It is alleged that the 12-inch sales gas pipeline was corroded in the area of the pipeline rupture which occurred at the pipeline beach crossing on Varanus Island on June 3 last year.

The Minister said the charge followed further investigations by the Department of Mines and Petroleum after the release of the initial investigation report by the National Offshore Petroleum Safety Authority (NOPSA) in October last year.

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