Scott Morrison's vocal opposition to a controversial offshore gas drilling project meant his later decision to formally block it was tainted by apprehended bias, a court has found.
The Federal Court on Tuesday quashed the former prime minister's December 2021 decision to block an extension of the PEP-11 project permit and remitted it to a joint federal-NSW authority.
That course of action had been requested by the two governments and permit holder Asset Energy.
Prime Minister Anthony Albanese has slammed his predecessor's decision, made after Mr Morrison secretly made himself the resources minister, as legally untenable and borne of a dishonest and incompetent administration.
Asset Energy launched a legal challenge to the PEP-11 decision last year, saying Mr Morrison breached the requirements of procedural fairness and that he was not validly appointed as the responsible minister of the joint authority.
Justice Darren Jackson made no finding as to whether Morrison secretly had himself appointed as a resources minister for the purpose of deciding the application.
But he was satisfied comments by Mr Morrison provided a proper basis to conclude that the decision was affected by apprehended bias.
Petroleum Exploration Permit 11, known as PEP-11, is a petroleum well off the NSW coast between Wollongong and Newcastle, covering about 8200 square kilometres.
Mr Morrison repeatedly voiced his opposition to the project in 2021, before and after his appointment as the second resources minister on April 15.
"(The PEP-11 permit) will go through processes, but I've made it absolutely crystal clear that's not something I support, and you can expect my view on that to be rock solid," he said in an April 21 press conference.
Justice Jackson said Mr Morrison's public comments "might lead a fair-minded observer to reasonably apprehend" that his "mind might have been closed to persuasion" when he deliberated on the matter in December 2021.
The same could be said about any deliberation after Asset Energy was given 30 days to respond to the government's intention to refuse its application, given Mr Morrison held a press conference the day of his decision and said the project "would not proceed".
"It follows that I accept the parties' joint submission that a breach of the rules of natural justice occurred in connection with the making of the decision," Justice Jackson said.
The federal government will pay Asset Energy's costs.
While decisions on offshore petroleum applications are made by a joint federal and NSW authority, the Commonwealth's decision is used to break stalemates.
The NSW government opposed the extension of PEP-11 in 2022 and reaffirmed its opposition on February 4.
