The urea fertiliser firm told told shareholders that references to NeuRizer products being “carbon neutral fertiliser” or “a carbon neutral product” in any of its communications to the stock exchange “are to be disregarded entirely”.

The admission, which also asks shareholders to disregard references to “zero carbon” or “net zero carbon”, follows a Conservation Council South Australia-led greenwashing complaint, which sparked an investigation into the company by the Australian Securities and Investment Commission (ASIC).

The ongoing investigation, which is yet to decide whether NeuRizer engaged in greenwashing, is looking at statements made by the company, formerly called Leigh Creek Energy.

Conservation Council South Australia (CCSA) lodged its complaint in mid-2023, and asked the corporate regulator whether NeuRizer and its planned underground coal gasification facility and fertiliser factory were breaching the Corporations Act 2001 or Australian Consumer Law.

It was particularly concerned about claims by the ASX-listed company on its website and in its 2022 Climate Related Financial Disclosure Report that the fertiliser it plans to produce will be “carbon neutral”.

NeuRizer is planning on operating an underground coal gasification facility and fertiliser factory on the site of an open-cut coal mine that was decommissioned in 2015.

NeuRizer is one of South Australia’s top companies. In 2022, it jumped 23 places in InDaily’s annual countdown of the state’s top 100 companies – the South Australian Business Index – moving from 67th place to 44th. In 2023, the company fell 38 places to 82^nd.

CCSA acting CEO Hugo Hopton said the “false claims of carbon neutrality were a key element of the company’s sale pitch to investors”.

“NeuRizer’s statement to the stock exchange this month confirms what we suspected – NeuRizer had been misleading investors,” the acting CEO claimed.

“We made the complaint to ASIC because we were concerned investors and regulators were being misled about the climate impacts of this dirty project, and that NeuRizer would use those false claims to finance the project.”

NeuRizer executive chairman Daniel Justyn Peters has previously rejected the Conservation Council’s claims and welcomed the investigation, saying the complaint was factually incorrect, misleading and was part of the Council’s “ideological opposition to gas, coal and a range of other endeavours”.

“We find the allegation that we are ‘greenwashing’ made by the Environmental Defenders Office on behalf of the Conservation Council of SA, both offensive and factually incorrect,” he said.

CCSA made its complaint via the Environmental Defenders Office (EDO), which is currently pursuing two separate court cases against Adelaide oil and gas giant Santos and energy company Woodside alleging the companies engaged in greenwashing.

The EDO was also behind a failed legal bid to halt the progress of Santos’ $5 billion gas pipeline project in the Timor Sea. That failure led to the instigation of a federal government review into the EDO following allegations it coached witnesses and confected evidence in the Santos legal bout.

Speaking to InDaily, EDO managing lawyer Kristy Ruddock said she was happy to see NeuRizer back down on its carbon neutral claims, but said the ASIC investigation was ongoing.

“We’ll find out whether ASIC is going to fine NeuRizer. ASIC has fined a number of companies, they have taken three cases to court [for greenwashing] but all in the superannuation space,” she said.

After ASIC’s first-ever greenwashing case against superannuation fund Mercer, the company agreed to pay a nearly $12 million fine that remains subject to court approval.

The watchdog also issued an infringement notice against Future Super Investment Services in May last year, following legal action taken alleging the super fund misled customers by overstating the positive environmental impact of the fund.

In March this year, ASIC won its first greenwashing civil penalty action against investments services firm Vanguard. The Federal Court found the company contravened the law by making misleading claims about certain environmental, social and governance (ESG) exclusionary screens applied to investments in one of its index funds. That matter has been listed for a further hearing in August at which the Court will consider the appropriate penalty to impose for the conduct.

Ruddock said regulators “should be continuing to do more”.

“They’ve obviously set environmental claims as the priority. We’d like to see them do more cases,” she said.

“There’s more to be done in this space, and across the spectrum: not just the litigation but the investigations.

“Even just the investigations can lead to better outcomes. We would say that NeuRizer is a case in point; no matter what happens with the end of the ASIC investigation the fact that they have been investigated led to this change, so that is really important.”

It comes as NeuRizer is trading at a low share price of $0.002 per share. The role of managing director at NeuRizer was also “made redundant” in January, forcing the departure of Phil Staveley. The executive chairman, Daniel Justyn Peters, took on Staveley’s responsibilities.

“So much has been achieved in his time as MD and there are too many examples to list here,” Peters said of Staveley in January.

“Most importantly these achievements were made during very stressful times. The changing relationship between China and Australia directly impacted on our progress.

“The changing attitude to both fossil fuels and gas has also created significant challenges.”

Since then, NeuRizer revealed its latest interim financial report showing a $799,131 loss in the first half to 31 December, which was mostly expenditure incurred primarily for exploration of its urea project.