Proving Disruption - What Santos v Fluor Decided

Santos v Fluor [2025] QSC 184 has been widely discussed since the Queensland Supreme Court handed down its judgment in August 2025, and not always accurately.

It is frequently described as a delay methodology case. It is not, primarily. It is a disruption case and the distinction matters, because disruption and delay are proven in genuinely different ways.

What was in dispute

The case arose from the Gladstone LNG project, where Santos engaged Fluor under a cost-reimbursable EPC contract between 2011 and 2014. Santos sought recovery of more than $1.4 billion it said had been overpaid to Fluor. The dispute was referred to three referees, who delivered a final report in 2023 substantially in Santos's favour. Fluor challenged the report on grounds including apprehended bias and a denial of procedural fairness, arguing the referees had not addressed every one of the hundreds of submissions put to them.

Justice Freeburn rejected that argument directly, and the reasoning is worth understanding because it applies well beyond this case:

“The purpose of the referees’ reasons was not to resolve every clash between the parties. The purpose was to indicate to the parties why the various decisions were made by the referees and to allow the parties to exercise such appeal rights, or other rights, as may be available to them.”

In other words, a decision-maker does not have to address every submission to have given a party a fair hearing. They have to explain why they decided what they decided. That is a materially lower bar than the one Fluor was asking the Court to apply, and it is the same standard a delay or disruption expert's report is ultimately judged against.

The disruption claim that actually succeeded

Buried inside the broader judgment is a more technically interesting finding for anyone working in delay and disruption: how Santos proved a disruption claim relating to wellpad construction, and why the Court accepted it.

Santos's claim was not for the cost of accelerating the works. It was a disruption claim — for the cost of work performed inefficiently because Fluor had to increase its workforce to recover from an earlier disturbance to the wellpad sequence.

“Fluor increased its workforce to complete the wellpads on time. The need was brought about by the earlier disruption to the wellpad work. The increase in manpower was accompanied by an increase in the costs of supervisors and foremen… All categories of costs were incurred as a consequence of the need to increase the workforce.”

This was not a productivity model built from theoretical loss-of-efficiency curves. It was a factual account: here is the disruption event, here is the manpower ramp-up that followed it, here are the cost records that show what that ramp-up cost. The Court accepted the analysis because the chain from cause to cost was shown, not assumed.

On the underlying principle of whether speeding up work actually costs more, the Court was equally direct:

“Although there is a widespread assumption that, when work is speeded up, it will lead to increased cost, whether that is so is not a matter of assumption; it is a matter of fact, which is to be proved in each particular case.”

Why the distinction matters

Delay analysis asks a sequencing question: did this event affect the critical path, and by how much time? Disruption analysis asks a productivity question: did this event make the work itself less efficient to perform, and what did that inefficiency cost? They are sometimes argued together, and they are too often analysed as if they were the same exercise. Santos v Fluor is a useful reminder that they are not.

A delay claim succeeds or fails on the programme and the critical path. A disruption claim succeeds or fails on cost records, resourcing data and a credible factual account of why the inefficiency happened. Santos won its disruption claim because it built that factual account from manpower and cost records, not because it ran a more sophisticated model than Fluor's experts did.

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For anyone instructing an expert on a disruption claim, the lesson from Santos v Fluor is not about choosing the right software or the most defensible productivity curve. It is about whether you can show, with records, the specific sequence: disruption event, resourcing response, cost incurred. Where that chain exists in the contemporaneous record, the claim has a foundation. Where it has to be reconstructed from assumption, it does not — no matter how elegant the model built around it.

At Accura Consulting, our team of experts work with clients to create a tailored solution to problems. If you have an issue and want expert support, get in touch.

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