Santos, the operator of GLNG, had a $55 million claim dismissed in the Supreme Court of Queensland.
Santos, the operator of GLNG, had a $55 million claim dismissed in the Supreme Court of Queensland.

Santos' $55 million suit dismissed for email discrepancy

SIGNING off an email as "authorised signatory" instead of "general manager" could have earned Santos $55million for a payment relating to the construction of GLNG gas fields.

Santos' claim that $55million was owing under a performance security signed by French investment banking group BNP Paribas was dismissed by a Queensland Supreme Court judge this week.

The claim was in relation to an unconditional bond relating to Flour Australia's work as a contractor for the construction of Santos' $25billion Curtis Island venture GLNG.

Flour completed the development of coal seam gas fields and hubs in the Surat Basin to feed the LNG exporting site.

Judge David Jackson ruled against Santos and told the energy giant to pay court costs for the defendant, BNP, because the company's demand for $55million was not done as per agreed in the terms of the unconditional bond.

In the Annex A letter, identified as a template for bank guarantee repayments, it is signed by "an authorised signatory of Santos limited".

"... Whereas the demand (sent by Santos) was merely signed by a person over the name Rob Simpson who was described as the General Manager Development," Judge Jackson said.

"The position description did not represent anything about Mr Simpson's authority per se.

"It follows, in my view, that the demand did not constitute a notice in writing purporting to be signed by an authorised representative of (BNP)."

The performance security in this case was considered an unconditional bond, which is used in construction contracts to pay money on demand to a stated maximum amount.



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