A slap on the wrist – Varanus prosecution

The West Australian government has finally decided to prosecute Apache Energy over the Varanus Island explosion in 2008.  Many people are asking if the effort is worth the bother as the maximum penalty possible is a measly $A50,000.

Comparing the disruption to the state’s gas supply to the Esso-Longford explosion, which generated a Royal Commission in Victoria, it illustrates the difference in having an explosion in an isolated area, that does not kill or injure, and that allows a government to ensure domestic gas supplies.  One could argue that a major difference was also that WA did not rely solely on a single gas source.

According to one media report

Apache spokesman David Parker said it would vigorously defend the matter. “The explosion was an unfortunate and unforeseen event”.

Explosions often are unfortunate and usually unforeseen but adequate maintenance requirements of pipelines are foreseeable, just not often profitable.

Apache Energy, a subsidiary of the US energy giant Apache, has not been the most transparent and helpful corporate citizen as it has taken Federal Court action that impedes the government’s investigations.

Kevin Jones

More on the Varanus pipeline can be read by searching for “Varanus” in the search function to the right of this blog page

Categories business, government, law, pipeline, risk, standards, UncategorizedTags ,

8 thoughts on “A slap on the wrist – Varanus prosecution”

  1. Kevin,

    I wasn\’t really raising the issue of penalties as punishment. Just pointing out that the size of fines will always be insignificant amounts of money to companies of this size. Also, such major incidents cause the companies cost far exceeding the fines.

    John.

  2. Kevin,

    I wasn\’t really raising the issue of penalties as punishment. Just pointing out that the size of fines will always be insignificant amounts of money to companies of this size. Also, such major incidents cause the companies cost far exceeding the fines.

    John.

  3. Kevin,

    I wasn\’t really raising the issue of penalties as punishment. Just pointing out that the size of fines will always be insignificant amounts of money to companies of this size. Also, such major incidents cause the companies cost far exceeding the fines.

    John.

  4. John

    You raise the issue of penalties as adequate punishment. I don\’t think the line that penalties act as a deterrent on other companies remains valid.

    Profits are so huge for some companies that for penalties to be a Punishment, it may be useful to set the penalty as a percentage of one year\’s profit.

    Deterrence will only come from public exposure of any penalty. Monetary penalties can be covered nowadays through statutory liability penalties (there is an article in SafetyAtWorkBlog on this matter) so they are really no penalty.

    Australia recently understood the power of apology through our Prime Minister saying sorry to our indigenous people for their past mistreatment. Corporations know the power of apologies by issuing them early after a disaster but a court-imposed apology or public act of restitution would be more effective.

    I have been in favour for a long time of placing a small plaque in footpaths or discretely on buildings to note the death of workers on construction projects. This would be a small notice of error but one of some longevity.

  5. Hello Kevin.

    The reasoning behind WA\’s prosecution is certainly obscure.

    I\’d like to know why it wasn\’t seen as a breach of OHS law.

    Re the possible penalties – of course $50k is trivial. But don\’t forget that Esso\’s penalty was also trivial – even though it totalled $2M. The total costs of these incidents to the companies is in the hundreds of millions.

    Like you, I wonder how corrosion at a beach crossing could be unforeseeable.

    John.

  6. Hello Kevin.

    The reasoning behind WA\’s prosecution is certainly obscure.

    I\’d like to know why it wasn\’t seen as a breach of OHS law.

    Re the possible penalties – of course $50k is trivial. But don\’t forget that Esso\’s penalty was also trivial – even though it totalled $2M. The total costs of these incidents to the companies is in the hundreds of millions.

    Like you, I wonder how corrosion at a beach crossing could be unforeseeable.

    John.

  7. Hello Kevin.

    The reasoning behind WA\’s prosecution is certainly obscure.

    I\’d like to know why it wasn\’t seen as a breach of OHS law.

    Re the possible penalties – of course $50k is trivial. But don\’t forget that Esso\’s penalty was also trivial – even though it totalled $2M. The total costs of these incidents to the companies is in the hundreds of millions.

    Like you, I wonder how corrosion at a beach crossing could be unforeseeable.

    John.

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