As Asia scrambles for gas, another Australian gas export plant is out of action, and the WA Government monitors the situation to ensure sufficient fuel for the state.
The troubled $6 billion flagship will be out of action "for a number of weeks," just as Santos' customers are desperate for gas to replace supply from the Middle East.
Regulator shuts Wandoo oil field off WA after spill
Canadian firm Vermilion judged the chance of the December spill as "rare" - the same probability it claims for seven planned exploration wells that could affect anywhere along the Pilbara coast.
Following a minor oil spill in December, the offshore environment regulator has shut down the Wandoo oil field, 80km off the Pilbara coast, until the Canadian owner, Vermillion, can demonstrate it is safe.
Regulator NOPSEMA called out "systemic failures" in Vermilion's management of Wandoo, including inadequate inspection and maintenance, and repeated instances of not complying with Wandoo's approved environment plan.
NOPSEMA's current assessment is that the hydrocarbon release was small with minimal environmenal impact, according to the regulator's spokesman. However, it is the fourth minor spill since 2021.
Vermillion wants to drill seven more wells
The condemnation of the $2.5 billion company's ability to operate Wandoo safely comes as it is seeking environmental approval to drill up to seven exploration wells starting in 2026 or 2027, in the search for more oil.
Vermilion claims in its environment plan for the drilling under assessment by NOPSEMA to be committed to meeting all regulatory requirements and to maintain a strong health, safety, and environmental risk management system.
It has not met either of these benchmarks with its current management of Wandoo, according to NOPSEMA's direction.
NOPSEMA identified problems with Vermilion's management of Wandoo during inspections in October 2025 and after the December 11, 2025, oil spill.
"These issues reflect recurring themes from earlier inspections and show that corrective actions and assurance processes have not fully addressed the underlying causes," the February 6 NOPSEMA direction published on Friday said.
Vermilion's website seeking consultation on its Australian plans
The NOPSEMA direction said the systemic weaknesses it identified may have contributed to the oil spill.
Vermilion has operated the wholly owned Wandoo field since 2005.
Wells reach out as far as three kilometres from two platforms: the unmanned Wandoo A and the crewed Wandoo B.
NOPSEMA has ordered Vermilion not to export any oil from Wandoo until it can demonstrate that it has implemented measures to make the existing system safe.
Wandoo produces about 5000 barrels of oil a day. Image: Vermilion.
Vermilion then has to have a completely new export system from the pipeline end manifold (PLEM) to the floating export hose in place by December 2027.
A NOPSEMA spokesman said its direction to stop oil exports will be in place until it is satisfied Vermilion has reduced the risk to the environment to as low as reasonably practicable.
"The General Direction also requires independent third-party reviews, corrective actions to strengthen environmental and integrity management systems, and a transition to a fully replaced oil export system by the end of 2027," he said.
"NOPSEMA will continue to closely monitor the titleholder’s compliance ... and will take further regulatory action if required."
Vermilion had a NOPSEMA direction issued three years ago over concerns that its inadequate maintenance of pipework on the platforms could lead to oil or gas escaping, resulting in a fire or explosion.
"Rare" oil spill risk has happened
Vermilion's proposed exploration drilling poses the risk of oil spills that could result in "behavioural changes and sub-lethal and lethal effects" to marine life in a "Hydrocarbon Area" (green in map) that covers almost the entire coast of WA's vast Pilbara region.
The map shows the area where an oil spill could impact. No one oil spill would affect the entire area Image: Wandoo exploration environment plan
The analysis in Vermilion's environment plan also defines a much larger area of the environment that might be affected (EMBA - pink on the map).
In this area, that stretches from Broome to Geraldton, the environment could be affected, but the impact may not be adverse.
The Canadian company determined that the probability of an oil spill from an uncontrolled well during exploration drilling was "rare".
This is the same probability that Vermilion's environment plan for its current Wandoo operations ranked the risk of an oil spill from the export system that occurred in December 2025.
Vermilion estimates Wandoo oil production can continue until 2030. If the exploration is not approved or is unsuccessful, the company will have to commence the expensive job of removing all infrastructure from the ocean.
Boiling Cold has asked NOPSEMA for details about the December oil spill.
Vermilion has been contacted for comment.
Boiling Cold's coverage of WA's oil and gas sector is free for all to read, maximising impact and accountability.
I need your backing to keep covering this powerful and influential industry.
I worked in oil & gas in commercial and engineering roles for 20 years. Since 2016, I have written for The West Australian, WAtoday, The Guardian and Boiling Cold, winning five WA Media Awards.
No profit, falling production, inadequate maintenance, a safety plan in limbo and a big clean-up if exploration fails: challenges aplenty at the Canadian company's only offshore facility.
Plans by Santos, which negligently caused an oil spill off WA four years ago, to drill seven exploration wells off the Pilbara coast have drawn fire from an environmental group.
