MONTANA OIL SPILL FIRM SEEKS PERMISSION FOR MORE DRILLS

Montara oil spill firm seeks permission for more drills

• The Australian
• April 29, 2011 12:00AM

Andrew Burrell

WA Chief Reporter

Perth

THE company behind Australia's worst oil spill in 25 years has told the federal government it should be allowed to drill two new wells just north of the ill-fated Montara field because it has a record of "responsible environmental management".

Thai explorer PTTEP has applied to drill the two exploration wells in the Timor Sea in commonwealth waters, one about 600km west of Darwin and the other 765km northeast of Broome, according to documents lodged with the federal environment department.

In a section of the document that asks whether PTTEP has a "satisfactory record of responsible environmental management", PTTEP replied: "Yes".

"(PTTEP), through its responsible and proactive response to the (Montara) incident, has shown its commitment to responsible environmental management," it said.

However, PTTEP also admitted that the Montara oil spill in 2009 in Timor Sea might have been worse than previously believed.

The company said 400 barrels of oil a day had spilled into the ocean for more than 10 weeks, but the amount of oil could have been as high as 1500 barrels a day in the initial stages.

PTTEP told the government it responded quickly to the incident and co-operated with government departments.

However, the Montara Commission of Inquiry into the oil spill blamed "widespread and systematic" deficiencies in PTTEP's practices, with commissioner David Borthwick finding the company's systems were so deficient and its personnel so incompetent that Montara was "an accident waiting to happen".

Mr Borthwick labelled PTTEP's failure to properly investigate the blowout as "irresponsible and inexcusable" and accused the company of seriously misleading the national petroleum safety regulator several times.

Resources Minister Martin Ferguson has since cleared the explorer to continue its Australian operations after an independent review found it was on the path to achieving "good oilfield practice".

PTTEP is a top-10 company on the Thai stock exchange and has more than 40 oil projects around the world.

The company says in its application it wants to drill the Kingtree-1 and Ironstone-1 wells in the Timor Sea at a depth of up to 1500m below the seabed.

The wells are located about 250km south of the Indonesian coastline, which was affected by some of the spillage from the 2009 well blowout. The drilling would take place later this year for about 21 days.

The permits are administered by the Northern Territory Department of Resources, which the Montara inquiry said had adopted a "minimalist" approach to offshore oil and gas regulation.

The resources minister used the report to press the need to transfer offshore petroleum regulation to a single national body but has encountered resistance from the Western Australian government.

PTTEP said in the application that it believed the likelihood of another well blowout was "low" and that it had since strengthened its well management and safety measures since the Montara accident.

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