An Australian judge has continued a stay on the potential liquidation of Seafarms’ Project Sea Dragon until an appeal launched by the company is heard and determined in court.
The project called for the development of 10,000 hectares into what would be one of the world’s largest black tiger shrimp aquaculture projects, but it has had a tumultuous history.
One former CEO claimed the project couldn’t proceed in its current form, and in February 2023, the company faced a trading halt as Seafarms Group Limited (SFG), the parent company behind the project, placed Project Sea Dragon into voluntary administration. The company later announced in July 2023 it remained committed to the project.
In February 2024, the Australian federal court ordered the liquidation of the company after Canstruct, the contractor selected to build the first phase of the project, sued claiming Project Sea Dragon failed to pay an owed AUD 13.9 million (USD 9.2 million, EUR 8.5 million). In his ruling, Australian Court Justice Michael Derrington found the company abused the Corporations Act in Australia, finding its deed of company agreement “should accordingly be terminated, the administration should be brought to an end, and Project Sea Dragon should be wound up.”
Liquidation of Project Sea Dragon was stayed until 28 days after the 22 February ruling, and since that time, the company has been granted multiple extensions as it appeals the judgment.
“The judgment delivered by the Federal Court today was surprising. On review of the judgment, our view is that it contains significant errors in both fact and law. Those significant errors provide a sound basis for an appeal that ultimately, we believe, will be successful,” then-CEO Rod Dyer said.
On 9 May, Justice Berna Collier granted the company another stay.
"The group welcomes Her Honour's decision to grant a continuance of the stay of proceedings,” SFG CEO Peter Fraser said. “Today’s decision allows the Seafarms Group to continue engaging with international stakeholders, as well as debt and equity investors, to develop Project Sea Dragon.”
Fraser, previously Project Sea Dragon’s commercial director, took over as CEO of the company in March 2024, and SFG Board Chair Ian Trahar said at the time the company remained committed to executing the next phase of the project’s development. In its latest company update, Fraser echoed that and said Seafarms is still working on its development.
“Project Sea Dragon remains a viable project that will provide significant benefits to its local and Indigenous communities, Northern Australia, and the company,” he said. “We remain confident of the ultimate outcome being a favorable decision to Seafarms and Project Sea Dragon.”
