The Australasian Centre for Corporate Responsibility (ACCR) commenced proceedings last year, alleging Santos had engaged in misleading or deceptive conduct in the 2020 annual report on "clean energy" and its route to net zero emissions.
"The litigation discovery process has revealed further instances where we contend that Santos has engaged in greenwashing," Brynn O'Brien, head of the shareholder organisation, said on Thursday.
"We allege that Santos misled investors and the public about its plan to achieve 'net zero' by 2040 and to produce 'zero-emissions' blue hydrogen," she said.
Santos has been contacted for comment.
Ms O'Brien said investors rely on company disclosures and have a right to complete, open and honest information relating to a company they are investing in or considering as a viable option.
Acting on behalf of ACCR, the Environmental Defenders Office (EDO) has filed to expand the case to include alleged greenwashing in Santos' 2020 investor day briefing and 2021 Climate Change Report.
To remain viable, gas companies are increasingly pinning their hopes on carbon capture and storage (CCS) technologies and blue hydrogen derived from fossil fuels and CCS, EDO senior lawyer Zoe Bush said.
Many investors and key trading partners prefer green hydrogen, which is produced from electrolysis - splitting hydrogen from oxygen in water - using renewable electricity with zero direct emissions.
"It is critical that companies are transparent about the greenhouse gas emissions associated with these processes, and their risks and uncertainties," Ms Bush said.
Santos last week posted a record result for the six months to June 30 on increased demand and rising prices during the global energy shock.
The company also announced a final investment decision has been taken to proceed with the Pikka oil project in Alaska, which it said would be "net zero from first production" using carbon offsets and CCS.
10°C