Lawyers for the federal government are arguing the Resources Minister was not required to consider the risks of climate change under legislation related to $21 million in grants recently awarded to a gas company.

Key points:

  • Environmentalists are challenging the validity of multi-million dollar grants awarded to Imperial Oil and Gas
  • They argue Minister Keith Pitt was required to consider the risks of climate change when awarding the money
  • But the court has today heard the minister was not required to consider those risks

The $21 million was handed to Imperial Oil and Gas to fund three exploration wells in the gas-rich Beetaloo Basin, south of Darwin.

Environmentalists spent yesterday challenging the grants in the Federal Court, arguing they are invalid because Minister Keith Pitt failed to consider the risks of climate change, which they said was required.

One issue in the case is whether the minister was required to consider those risks as part of his “reasonable enquiries” when awarding the subsidies.

The minister’s lawyers have today argued the minister only needed to be satisfied his enquiries were reasonable — in other words, it is a subjective measure and not an objective one.

Tom Howe QC, acting for Mr Pitt, told the second day of hearings that broadening the necessary enquiries to include issues such as climate change would place “an extraordinary and indeed an intolerable burden of decision-making upon the minister”.

“The minister has to make enquiries and then, depending on the outcome of those, has to run different bunnies into various burrows to ascertain whether something’s relevant, according to the applicant,” he said.

Federal Resources Minister Keith Pitt wears glasses at a press conference in Darwin.

Resources Minister Keith Pitt is standing by his decision to grant the funds.(ABC News: Felicity James)

Mr Howe also said the legislative clause the environmentalists yesterday relied on to argue the grants were not a proper use of public money, referred to as section 71, relates only to the funding of policy choices and not the merits of underlying policy decisions.

“One does not apply section 71 as an ecological or environmental Trojan horse obliging ministers in all sorts of contexts to have regard to things which go to the desirability of an alternative policy choice,” he said.

Mr Howe also rejected the argument that no consideration whatsoever was paid to climate risks, because compliance with emissions reductions expectations was part of eligibility for the grant program.

“We accept there was no detailed inquiry made by the minister of any kind in response to the material he was briefed with,” Mr Howe said.

“We do resist the suggestion that climate risks played absolutely no part at all in the universe of material that was provided to the minister.”

Justice John Griffiths today took issue with the fact that a section of case law relied upon by Mr Howe was only brought to the plaintiff’s attention in the days before the hearing, despite the involvement of one of Mr Howe’s colleagues in the case. 

“My concern is one of fairness to the applicant in this case,” he said.

Justice Griffiths said the applicant would be asked whether they had enough time to consider the case and, if not, they would be asked if they wanted to add written submissions related to the ruling given the “prominence it’s now acquired in [Mr Pitt’s] case”.

The hearing will continue into the afternoon.

The ECNT has labelled their lawsuit a landmark case because of the level of scrutiny applied to government subsidies of the fossil fuel industry.

Resources Minister not required to consider climate change when awarding gas grant, lawyers argue
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