Tipakalippa had sued the regulator, alleging his Munupi clan had not been properly consulted before it approved Santos’ plan to drill up to eight gas wells about 120 kilometres north of the islands.

Santos had appealed against an earlier court ruling that found NOPSEMA had approved Santos’ environmental plan without checking if it had carried out adequate consultation with all relevant parties, as required by law.

At a week-long hearing in August, including hearing evidence on-country, Tipakalippa’s lawyers from the Environmental Defenders Office (EDO), argued that this inadequate consultation rendered the approval of the drilling invalid.

Santos suspended drilling at its $6.2 billion Barossa gas project after the September court decision but work continued on other aspects of the project.

Santos said on Friday it did not expect losing the appeal would have a material effect on the cost and schedule of its project.

Loading

Greens spokesperson for resources and Yamatji-Noongar woman and Senator Dorinda Cox congratulated Tipakalippa and the Munupi traditional owners.

“Today we have seen cultural giants defeat a billion-dollar company,” Cox said.

“The fact that Santos didn’t consider the Munupi people relevant is appalling and I’m happy to hear the court has upheld its decision.”

Santos and its partners – JERA of Japan and Korean group SK – committed to the Barossa gas project in early 2021. Much of the gas from Barossa to be exported from 2025 will go to Japan and Korea which are increasingly concerned about energy security since Europe raced to replace gas from Russia after the invasion of Ukraine.

They planned to drill the gas field and build a floating gas processing plant and a 260-kilometre pipeline to connect with an existing pipeline to Darwin.

Friday’s decision has raised the prospect of more appeals against already accepted environment plans that cover the entire offshore oil and gas industry in Commonwealth waters by groups that believe they were not properly consulted.

In particular, Woodside’s $17.6 billion Scarborough gas project under construction is facing opposition from Indigenous groups in WA’s Pilbara region.

Samantha McCulloch, chief executive of oil and gas lobby group APPEA, said Australia had a reputation as a safe place for international investors and called on the federal government to reform the regulatory process and provide certainty for approvals.

Resources minister Madeleine King, who independent regulator NOPSEMA reports to, said the Albanese government would consider the implications of the decision.

In October Prime Minister Albanese said Australia would remain a “steady and reliable supplier” of energy to Japan.

However, any action by the government to address the concerns of oil and gas producers could be politically difficult if they are seen to impinge on the right of Indigenous people while the prime minister is fighting to secure support for the Indigenous voice to parliament.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.