Oil company to pay up in rare Native Title ruling

An oil and gas explorer will have to pay court costs of more than $200,000 for what has been described as “unreasonable conduct” in relation to a Native Title claim.

After a loss in the Full Court of the Federal Court, Sydney-based, ASX-listed Oil Basins Ltd will have to pay a legal bill of more than $160,000 for the Nyikina Mangala People’s legal representation by the Kimberley Land Council.

The company told the ASX on Monday it also expected to have to pay another $90,000 in costs.

In a judgement handed down on July 6, the Full Court of the Federal Court dismissed an appeal by the company.

Lawyers for Oil Basins Ltd had unsuccessfully argued that the company should not have to pay the costs because the Nykina Mangala People were represented by a KLC lawyer and did not incur legal costs engaging the land council.

But three judges of the Federal Court disagreed. Justices Anthony North, John Dowsett and Steven Rares ordered that Oil Basins’ appeal be dismissed, clearing the way for the explorer to pay a bill of $161,248.

Oil Basins Ltd company secretary Carl Dumbrell could not be reached for comment, but in a statement to the Stock Exchange on Monday, the company addressed the court loss.

In its June Quarterly Activities report, it said the company expected that money held with its lawyers would now be required to pay the legal costs.

“The company expects that monies held in controlled monies account with its solicitors will now be required to be paid to parties awarded costs against OBL in previous Niyikina Mangala proceedings,” it said.

“The company also expects that an additional approximately $90,000 which has been awarded in costs against OBL in the Nyikina Mangala proceedings will be taxed and will become payable.”

For the year to June 30, Oil Basins posted a net cash loss of $745,572 on its operating activities, but with borrowings and share issues had net cash from financial activities of $781,700.

Its cash and cash equivalents at the end of the year were $58,436.

The petroleum exploration permit understood to have given rise to the court action — the Derby Block in WA’s north — was sold to its joint venture partners Rey Resources last month.

Oil Basins said the site was no longer financially viable to it because of its distance from Perth, lack of infrastructure and environmental and Native Title issues.

NIT understands an order for costs in Native Title consent determination is rare.

The dispute dates back to late 2012 when Oil Basins applied to be joined as a respondent in an application for Native Title by the Nyikina Mangala people.

In 2013 the company challenged the connection of Nyikina Mangala traditional owners to their lands, despite the WA government having already accepted the connection.

The actions forced the start of trial proceedings before the company changed its mind.

In 2014 the Federal Court ordered that Oil Basins pay the Nyikina Mangala peoples costs because of its “unreasonable conduct”.

The ruling of the Full Court of the Federal Court last week dismissed the third consecutive appeal by the company against the original order.

“The judgement sends a clear message to companies that wish to question, hold up or thwart Native Title processes that they can face severe monetary consequences,” KLC chief executive officer Nolan Hunter said Tuesday.

“For the Nyikina Mangala people, we hope they will feel vindicated by this ruling and that this long-running matter can finally be resolved.”

The Nyikina Mangala people applied in 1998 to be recognised as the Native Title holders of their traditional country. Their consent determination was handed down in May 2014.

Oil Basins Ltd has until August 3 to appeal the most recent decision.

Wendy Caccetta

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