The Northern Territory Government has removed the moratorium on hydraulic fracturing, following an extensive, independent and robust 18-month inquiry which found the risks associated with unconventional gas development can be mitigated to acceptable levels or removed entirely.
The Australian Petroleum Production and Exploration Association (APPEA) welcomed the news, which would enable the creation of thousands of jobs in the Territory, billions of dollars of government revenue and the delivery of much-needed energy supply for the NT and the nation.
The government has accepted the key finding of the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory that any risks associated with onshore gas development and hydraulic fracturing can be managed by effective regulation.
APPEA NT Director, Matthew Doman, welcomed the government’s decision to support development of the NT’s abundant gas resources.
But he warned the manner and timeframe in which it implemented the inquiry’s 135 recommendations would be critical in determining the commercial viability of the industry.
In particular, the government has accepted that 30 of the recommendations must be brought into effect before exploration activity can resume.
“If they are to be implemented, they must be addressed within the next six months to ensure the industry can be on the ground exploring in the 2019 dry season,” Mr Doman said.
“Businesses, contractors and workers in the Territory are counting on the quick ramp up of the gas industry to get the Territory moving again. Explorers are ready to resume their activities as soon as the government gives the green light.
“As soon we can get back to work, we will again employ local people, engage local companies and resume royalty payments to host Traditional Owners. Our exploration activity will build our knowledge of the gas resources, groundwater and the environment that contains them, and enable informed decisions about future development.
“APPEA’s member companies stand ready to invest billions of dollars in new projects in the Territory. We are determined to do this in a safe and sustainable manner, and to generate real benefits for all Territorians.”
APPEA Chief Executive, Dr Malcolm Roberts, said states opposed to onshore gas development should be reconsidering their positions.
“As we look to Friday’s COAG Energy Council meeting, the Territory Government has sent an important message to other jurisdictions about the energy security, emissions reduction and economic benefits of natural gas. It is time for those other jurisdictions to hear that message,” Dr Roberts said.
Jemena has also welcomed the announcement and intends to progress its plans to extend and expand the $800 million Northern Gas Pipeline (NGP).
This work is expected to create around 4000 jobs across northern Australia, with early estimates placing the cost of the project at around $3 – $4 billion.
Jemena’s Managing Director, Paul Adams, commended the Territory Government’s decision, noting it had commissioned a thorough review into unconventional gas development that included broad and frequent consultation with the community.
“The Territory has great potential as the future heartland of Australia’s gas industry. Today’s decision paves the way towards a well-regulated industry that benefits the people of the Territory while helping to bring much needed additional gas to where it is needed most,” Mr Adams said.
“This is good news for locals who can expect to benefit from additional jobs and training opportunities in the gas industry, as well as Territory businesses who will benefit directly from contracts on upcoming projects. A thriving gas industry will also benefit the whole community as the indirect benefits flow to the broader Territory economy.
“This decision now gives us the certainty we need to move forward, and we encourage the Territory Government to maintain pace and move to swiftly implement the inquiry’s recommendations.
“Provided sufficient and appropriate gas is proven and will be available for transportation, our ambition is to commence preliminary works on the extension and expansion of the Northern Gas Pipeline in 2019.”
Mr Adams said the NGP will be completed in late 2018. It will initially transport around 90 terajoules of gas, with the extension and expansion of the Northern Gas Pipeline having the potential to bring around 700 terajoules of gas – enough gas to meet the average daily domestic gas needs of Brisbane, Sydney and Adelaide – to market.