The Santos Ltd (ASX: STO) share price is dipping into the red today.
Shares in the S&P/ASX 200 Index (ASX: XJO) oil and gas stock closed yesterday trading for $7.20. In morning trade on Thursday, shares are swapping hands for $7.18 apiece, down 0.3%.
For some context, the ASX 200 is down 0.2% at this same time.
This comes as Santos responds to yesterday's federal court ruling on the stalled construction of the pipeline for its $5.8 billion offshore Barossa gas project, located in the Timor Sea.
How did the ASX 200 energy stock respond?
On 2 November, we reported on the latest headwinds facing the Santos share price.
This came after the federal court suspended work on the Barossa pipeline until it could hear arguments from three Tiwi Island elders. They want the project scrapped, claiming the undersea construction work could destroy ancient, culturally sensitive sites.
Environmental Defenders Office lawyer Fiona Button, representing one of the plaintiffs, Simon Munkara, sought a full injunction from the court in October.
Yesterday the court made an initial ruling on the project, which is meant to supply Santos' LNG plant in Darwin.
Santos replied that it "notes the decision of the Federal Court of Australia today ruling pipelay activities can commence on an 86 kilometre section of pipeline for the Barossa Gas Export Pipeline".
The pipeline, however, is 262 kilometres long.
And Santos said, "As per the ruling, no activity will occur south of kilometre point 86."
Not until the court makes its final decision, in either case. That hearing is now set to commence on 4 December.
Santos said it "intends to vigorously defend those proceedings".
The ASX 200 energy company reiterated that it is committed to delivering the Barossa Gas Project, and it is still targeting production in the first half of 2025.
According to Santos:
With the Barossa Project set to supply the Darwin LNG plant for years to come, it is important for local jobs, as well as opportunities for traditional owners, exports, and relationships with investors and gas customers in Asia, that this project continues.
Justice Natalie Charlesworth noted that any work Santos does might prove "futile" if the remainder of the pipeline construction is blocked.
Indeed, should the final ruling go against the company, it could have a material impact on the Santos share price.
According to Charlesworth (quoted by The Australian Financial Review), "To my mind whether Santos should proceed with the works north of the defined point in the face of the present uncertainty is a decision for Santos to make."
Tiwi elder Molly Munkara sounded elated by the court ruling, saying, "I was calling out to ancestors all this week asking to protect our waterways, marine life, Sea Country. I asked for them to stop Santos, and they listened."
Australian Energy Producers CEO Samantha McCulloch had a different reaction.
"The economic and energy security of Australia and its valued international partners is being damaged," she said of the latest legal wrangling.
Santos share price snapshot
The Santos share price has gained 2% so far in 2023.