BPH confirms Asset Energy’s decision to initiate PEP11 legal action

BPH Energy (ASX: BPH) has reported that its investee company Asset Energy is taking on the Australian and NSW governments on behalf of the PEP11 joint venture (JV).

The unlisted Asset Energy is the operator of the offshore PEP11 permit, where it is exploring the large area off the NSW coast with Bounty Oil (ASX: BUY).

Asset has filed an originating application for judicial review in the Federal Court on behalf of the JV following alleged ongoing delays to its applications to drill an offshore well.

Breach of duty

In lodging its application, Asset has declared that the Commonwealth-New South Wales Offshore Petroleum Joint Authority has breached an implied duty by allegedly failing to make a decision under the Offshore Petroleum and Greenhouse Gas Storage Act 2006 with respect to two pending applications relating to PEP11.

It has also made an official order that the Joint Authority be compelled to determine the applications within 45 days.

Asset initially applied for federal determination in late December 2019, seeking a variation and suspension of the conditions of the PEP11 permit and an extension of the term of the permit.

Application lodged

Asset sought further time to lawfully drill an exploration well in PEP11 and, if successful, to conduct post-well studies rather than a 3D seismic survey.

The National Offshore Petroleum Titles Administrator (NOPTA) accepted the first application on behalf of the Joint Authority on 23 January 2020.

In late January 2021, Asset applied for a variation and suspension of the conditions of the PEP11 permit and an extension of the term of the permit.

The application was sought to, among other things, enable Asset further time to lawfully drill an exploration well and to invoke decision-making principles set out in the April 2020 COVID-19 fact sheet: work-bid exploration permits.

NOPTA subsequently accepted the second application on 4 February 2021.

Decision set aside

On or about 26 March 2022, the joint authority formally determined to refuse the first application.

On 14 February 2023, this first application decision was set aside by Australia’s Federal Court on the ground of apprehended bias.

Between March 2023 and October 2023, Asset provided further information to NOPTA, which then made a recommendation to the joint authority with respect to both applications.

To date, neither the first application nor the second application has been determined by the joint authority according to law.

Asset alleges that – with it having been 1,656 days (inclusive) since the first application was accepted by NOPTA and 1,278 days (inclusive) since the second application – the failure by the joint authority to make a decision with respect to either or both applications constitutes a breach of its duty to consider them within a reasonable time.