OIL and gas producer Santos has rejected calls by some shareholders to drop the Narrabri coal seam gas project in North West NSW and start investing in renewable energy.
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Ninety-eight shareholders, representing about 0.019 per cent of the company’s shares, are among 104 signatories to a notice sent to Santos requesting a resolution to dump the Narrabri project be put to the company’s annual general meeting (AGM) in May.
The shareholders say that they are concerned by the current financial state of Santos and the “high level of uncertainty” around the Narrabri project.
They say the Narrabri project is facing sustained community opposition and a legal challenge in the NSW Land and Environment Court over the approval of a wastewater treatment facility in the Pilliga forest.
“The Narrabri gas project threatens Santos’s reputation and now that it is the sole coal seam gas project proposed for NSW, it makes Santos look like a rogue operator,” the proposed resolution says.
“We move that the Narrabri gas project in North West NSW be withdrawn from Santos’s portfolio and Santos begin a process for investigating renewable energy investment options.”
Santos has rejected the call for the resolution to be put before shareholders.
“Santos advises that it will not be putting the proposed resolution to the AGM,” Santos said yesterday.
Santos said the proposed resolution failed to satisfy requirements under the Corporations Act.
Shareholders may propose a resolution if they hold at least 5 per cent of the votes that may be cast, or if they number at least 100.
Santos also said that a similar resolution had been rejected at the 2014 AGM by an overwhelming majority of shareholders, with 99.2 per cent of votes cast going against it.
The Narrabri gas project, which Santos says could supply up to half of the natural gas used by NSW homes, covers about 95,000 hectares in and around the Pilliga State Forest south of Narrabri.
Water extracted during the exploration and appraisal program is held in a water storage facility at the company’s Leewood property, about 24km south of Narrabri.
Santos has government approval to build a water treatment plant at the Leewood facility.
In February 2015, amid plummeting oil prices, Santos wrote down the value of the Narrabri coal seam gas project by more than $800 million, to only $500 million.
Last month, a coal seam gas protest meeting set to be held at the Narrabri Golf Club was cancelled, with activists from the North West Alliance accusing Santos of pressuring the golf club not to host the meeting.
