News

SHELL Australia told Energy News this morning it is still working to restore production at its massive Prelude FLNG project, but is unable to provide a time frame on when it expected the facility to resume at full capacity.

A Shell spokesperson confirmed to Energy News that the facility remained shuttered this morning, but stressed the company but said it was doing what it could to bring produce back 

"Our focus is on the safe and stable restoration of production," the spokesperson said.

"Work continues to restore full operations on Prelude."  

Shell took the decision to shut the vessel down in February, standing down half of its crew. 

 The facility's backup power generation had failed and there were issues with toilet facilities, among others. 

Since it began operations last June, the Prelude has sent 15 cargoes, shipping a record three cargoes in December. At full capacity it can send four a month, but has not hit this milestone yet. 

Energy News understands no customers are currently affected by the lack of LNG supply from Prelude. 

Shell also made the decision to delay any final investment decision on the development of its Crux field some 30km from the Prelude which is slated as backfill for the giant U$15 billion FLNG vessel due to the oil price crash, the spokesperson said.

Source: Energy News Bulletin

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Minister Paul Kirby's Office

In a significant boost for the NT economy and prospects for local jobs, the Territory Labor Government has granted final approval to Core Lithium Ltd to commence development of its new lithium mine in the Top End.

The Finniss Lithium Project is a proposed open cut lithium mine located along the Cox Peninsula Road, approximately 35km west of Berry Springs. 

It is the first ever lithium mine to be approved outside of Western Australia, and is the first new mine of significant scale to be approved in the NT since 2013.

The project estimates approximately two million tonnes of lithium-bearing ore will be mined over the predicted three to four year life of the mine, and will provide around 200 jobs to local Territorians.  With the mine only an hour’s drive from Darwin and 35km from Berry Springs, the entire workforce will drive to and from the site each day and no camp will be required.

Lithium is considered a critical mineral that is strategic to the global economy, particularly for new and emerging technologies such as batteries, electric vehicles, mobile phones, high-definition screen displays, solar panels, medical equipment and military technology.

The development of the Finniss Lithium Project has the potential to position the NT as a strategically important jurisdiction for the production, processing and manufacturing of critical minerals to the global market. 

Access to the power station, rail and gas facilities, and one hour via sealed road to a local workforce and the Darwin Port position the project to efficiently supply key Asian lithium markets, and provide scope for further processing potential within Darwin itself.

Minister for Primary Industry and Resources, Paul Kirby, has approved the project’s Mining Management Plan (MMP) and issued an Authorisation to Core Lithium Ltd to commence development of the project.

 

Quotes from Minister for Primary Industry and Resources, Paul Kirby:

“The Territory Labor Government knows that local jobs and economic recovery have never been more important.  The resources sector is going to play a huge role in our recovery from the COVID-19 crisis, and the milestone achieved by the Finniss Lithium Project is very good news for Territorians.

“The first three years of this project are expected to inject over half a billion dollars into the NT economy and create around 200 jobs for Territorians within an hour of Darwin.

“We will get through this crisis, and the Territory Labor Government is working hard to kick-start our economic recovery, including creating local jobs for Territorians.”

 

Quotes from Core Lithium’s Managing Director, Stephen Biggins:

"The Finniss Lithium Project will create more than 200 direct full-time jobs in the Northern Territory, with potential to inject more than half a billion dollars during its first three years of operation into the local economy.

"Core Lithium would like to thank the Minister for Primary Industry and Resources, Paul Kirby and Northern Territory Government for their engagement during the MMP approval process. By working together with the Territory Government the Finniss Lithium Project opens the door for the Territory to be a key supplier of high-quality lithium for batteries to power the growing global electric vehicle market.

 “The Territory has the opportunity to play a crucial role in supporting the world's response to reducing emissions and managing climate change risk.”

 

Media Contact:  Tom Ryan 0436 951 084

Office Michael Gunner Chief Minister

The Territory Labor Government will establish a $5 million Worker & Wellbeing Fund to support local workers struggling with the economic effects of the COVID-19 crisis.  

The impact of the COVID-19 crisis has meant difficult and uncertain times for many Territorians. 

The Territory Labor Government is working round the clock to save lives, save jobs and reduce the economic impacts wherever possible. We have implemented strict border and quarantine rules, a Jobs, Rescue and Recovery Package, and a Small Business Survival Fund.  

And we’re going to keep doing more to protect Territorians – whatever it takes.

The Fund will focus on Territorians who are experiencing unemployment, reduced income or who are affected within their workplace because of the COVID-19 crisis.

The Worker & Wellbeing Fund will help make sure Territorians doing it tough get access to the services they need, such as financial counselling, relationship counselling or general wellbeing support.

Additionally, the Fund will assist Territorians navigate the Centrelink system or look for a new job. This can be a difficult and daunting experience, particularly right now. For many, it may be the first time they have needed to access these services.

An advisory group chaired by Wendy Morton, former Executive Director of NTCOSS, with representation from business, community and unions has been established. This group will be tasked with providing advice on how to target the right resources to the right people, as well as identifying where there are gaps in the availability of services.

The Worker & Wellbeing Fund’s main goals are to:

• Help people access the range of wellbeing and other counselling or support services that are available
• Help people navigate the welfare system and access income and any other financial support available
• Help workers who have lost their job find new employment opportunities fast –such as guiding people to job matching services like the Territory Jobs Hub
• Assisting Territorians who require access to accommodation and other essentials

This funding is to meet new and emerging gaps and will be available for people who were not already receiving Centrelink benefits such as Newstart or Youth Allowance prior to the COVID-19 economic downturn. It will also be complementary to any initiatives announced by the Australian Government.

Details about the operation of the fund will be made available on 3 April 2020.

Quotes from Chief Minister Michael Gunner: 

“This is a once-in-a-century crisis that’s hurting a lot of Territorians in different ways.

“I want to do everything possible to assist Territorians – whether it’s supporting small businesses, helping people look for new jobs, or providing easy access to support services for people who are being put through the ringer.

“We like to say we’re ‘Territory Tough’ up here. But there’s nothing wrong with getting help when you need it. A lot of people are in the same boat and the Worker & Wellbeing Fund will assist people to access the support they need. 

“We’re all in this together, we’ve all got to look out for each other.

“We will continue to work for Territorians and get us all through this difficult time. If we stick together, we’ll come out the other side stronger.”

Quotes from Minister for Territory Families, Dale Wakefield:

“We want Territorians to feel supported during this time. This program will provide information about where to go for help, assistance to access the relevant support and provide additional resources for individuals and for wellbeing services such as counselling.

“Asking for help, or a listening ear is important during this unprecedented time. Whether you’re a worker, self-employed or a visa holder - this package is for anyone who is living in the Territory and has been affected by COVID-19.

“We are bringing together the best advice the union movement, business and community sector can offer to guide government on how to help people address their own unique circumstances.”

 

 

OPERATOR Origin Energy and its Irish joint venture partner Falcon Oil & Gas have hit the brakes on development of the highly anticipated Beetaloo Sub-basin shale Kyalla project in the Northern Territory due to concerns over an outbreak of coronavirus.

Overnight, Falcon (30%) told shareholders that all work on the Kyalla 117 N2-1H ST2 well had ceased and workers at the field had been reduced to a skeleton crew. 

The Kyalla well successfully reached a total depth of 3809 metres, including a 1579 lateral section, just last month. 

Water bore installation and preparation for a fraccing program was well underway. 

The Northern Territory is currently under remote community lockdowns as coronavirus cases swelled from eight to 12. 

The government introduced new emergency powers restricting access to remote communities which came into effect last night to prevent an outbreak of COVID-19 in far-to-reach regional areas.

In light of these new restrictions Origin and Falcon's employees and contractors are not able to travel to and from the Kyalla site. 

The venture hopes the delay will only be for a few months and plan to resume work on the well in the "latter half" of this year. 

The company said it would seek Northern Territorian workers to undertake minor civil and preparatory work throughout the interim period. 

Citing the unprecedented circumstances, Falcon CEO Philip O'Quigley said the company would act quickly to protect local communities. 

"While the joint venture is committed to the Beetaloo project and results to date are encouraging, the focus at this time must be on the health and safety of people," O'Quigley said. 

Kyalla has been labelled an exciting ‘well to watch' for many analysts up until this point. 

The targeted Middle Velkerri B Shale Pool holds an estimated 2C gas resource of 6.6 trillion cubic feet. 

According to consultancy EnergyQuest the Velkerri and Kyalla formations are analogous to the Marcellus shale of the US, one of the most productive, low cost, shales in North America. 

Initial evaluation of the vertical section found three source rock reservoir sections identified within the Kyalla Shale Formation, with a thickness measuring almost 900m.

The three sections are known as the Lower, Middle and Upper Kyalla reservoirs. Gross thickness of each interval is between 75m-125m.

When drilling, Origin noted that all three sections exhibited "elevated gas shows with relatively high C3, C4, and C5".

The big-budget Kyalla 117 N2 is the first of two wells the joint venture will drill targeting the Kyalla shale liquids gas play in exploration permits EP117, EP76, and EP98.

Source: Energy News Bulletin

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THE Chief Minister has launched a furious attack on anti-fracking campaigners for ‘spreading lies’ about FIFO workers and clogging government phone lines in the middle of the coronavirus crisis.

THE Chief Minister has launched a furious attack on anti-fracking campaigners for “spreading lies” about FIFO workers and clogging up government phone lines in the middle of the coronavirus crisis.

East-coast activist group GetUp! started a campaign this week claiming companies like Origin Energy were flouting quarantine measures in the NT and putting the lives of remote community residents at risk.

The campaign claimed fracking has been deemed “essential” in the Territory but the NT Government said this is not true.

Instead, a spokesman from Origin said they had temporarily paused fracking activities at Beetaloo Basin due to the pandemic and scaled back to only having 45 employees on site.

But a spokesman from GetUp! said its concerns about FIFO workers were legitimate.

“Northern Lands Council and Central Lands Council have stated that they are being approached by remote communities concerned about FIFO workers on their community,” he said.

“They’ve seen these workers coming in and out of their shops.”

The Chief Minister said it made him “sick” that GetUp! was trying to “exploit people’s fear in the middle of a national crisis” for political purposes.

“To deliberately lie and scare remote communities like this is despicable and unforgivable,” he said.

“I’ve got people working round the clock to help people who have been left on the scrapheap.

“I don’t need them distracted by these bullshit scare campaigns run by a bunch of Twitter trolls.

“Our phone lines are running off the hook with people worried about their business or their job.

“We’ve got people who don’t know where their next meal is coming from.

“And because of bloody GetUp, our phone lines are clogged up with something that is based on a lie.

“They sit in their fancy office in Sydney and come up with this crap, and they have no idea about the damage they are doing to people over here.

“My message is simple: Piss off. Stop diverting our resources away from saving lives to stopping your lies.”

Source: NT News - Read more here

Office Chief Minister Michael Gunner

The Territory Labor Government’s $50 million Small Business Survival Fund will help local Territory businesses survive the unprecedented economic impacts of COVID-19.

Coronavirus is hitting Territorians hard and this government is doing everything it can to soften the blow.

This fund is specifically targeted at supporting industries such as retail, hospitality, tourism, and entertainment businesses, including beauty parlours and gyms, who are bearing the brunt of this national crisis. 

More than 1000 Territory businesses will be supported through this fund who employed around 10,000 Territorians prior to the restrictions.

The fund will provide payments based on business size and full time equivalent (FTE) employee numbers.

From today, eligible businesses will be able to apply for two payments:

• An Immediate Survival Payment of between $2000 and $50,000 to help offset the immediate costs pressures on businesses
• A Rapid Adaption Payment of between $1000 and $5000 to assist businesses make the necessary changes it chooses to help adapt to the new operating environment 

Immediate Survival Payment

An initial lump sum payment directed to businesses to help offset immediate cost pressures and provide time to plan.

• $2000 for business with 1 FTE/sole traders
• $5000 for businesses with 2 to 5 FTE employees
• $20,000 for businesses with 6 to 19 FTE employees
• $50,000 for businesses with more than 20 FTE employees

Business will provide a certified financial/payroll statement identifying number of employees pre-shutdown.

Assessment of eligibility criteria includes demonstrating the impact of the restrictions on the business, including reduction in turnover, impact of fixed costs and employment reduction. 

Rapid Adaption Payment

• A payment of up to $1000 for sole traders and up to $5000 for other eligible businesses to offset costs incurred in adapting current business model to suit restrictions.
• Application based, paid direct to business.
• Paid on provision of appropriate invoice. Buy local provisions will be highlighted to businesses.
• Expenditure to occur post announcement and applications close 1 May 2020.
• After this time businesses have full access to Improvement and Immediate Works grants under the Jobs Rescue and Recovery package.

This is the first stage of the Small Business Survival Fund. The Business Advisory Group is continuing to meet and will provide advice for the next stage of the package.

Businesses can complete an application form on business.nt.gov.au/recovery from 5pm today and will be assessed using the following criteria; that they:

• are a legal entity and hold a valid Australian Business Number (ABN) as at 23 March 2020, and
• are operating in the Northern Territory, and
• is a Territory Enterprise, and
• have a significant permanent presence in the Northern Territory, and
• employ Northern Territory residents (sole traders are included), and
• usually operate in one of the industry sectors affected by the social gathering restrictions announced on 22 March 2020 and 24 March 2020, and
• have been directly financially affected by the social gathering restrictions. 

The Department will also actively reach out to directly affected businesses to discuss their suitability for support from this Fund, as well as the other support that is now available from both the Territory Government and the Federal Government.

The Small Business Survival Fund is in addition to the Jobs Rescue and Recovery Package and the Tourism Resilience Package announced previously.

The Territory Government is investing nearly $120 million so far in response to the coronavirus. And we will continue to scale up to save jobs. 

Quotes from Chief Minister, Michael Gunner

“My only focus right now is saving lives and saving jobs. I’ll do whatever it takes to protect Territorians.

“The Territory Government is investing nearly $120 million so far in response to the deep economic impacts of the coronavirus crisis. And we will continue to scale up to save jobs.

“When you spend a dollar in the Territory, you save a Territory job – and in times like these we need our community to band together to keep our small, local businesses open, and as many locals as possible working.”

AUSTRALIA’s energy market operator (AEMO) has released its annual Gas Statement of Opportunities report for 2020, warning that pipeline capacity and maturing gas fields could pose a significant risk unless further action is taken to ensure energy security.

The country remains hungry for energy despite being the top exporter of LNG, and today's AEMO Gas Statement of Opportunities report found Australia already has enough gas to satisfy demand until 2025, but only if LNG cargoes are redirected as needed.

The GSOO only looks at the eastern states and does not take in Western Australia, which accounts for two thirds of Australian LNG exports and is well supplied with gas thanks to its 15% domestic gas reservation policy. 

Current production from existing and committed gas developments should be adequate between 2023 and 2025, the report states. 

However, the glaring problem is the sheer level of gas exported from Australia as LNG.

AEMO warned unless industry curtailed its exports of LNG and redirected some of it to the domestic market, the east coast energy sector could face a lack of supply as demand continued to grow. 

More concerning, however, is that after 2025 existing and committed gas production and projects in southern Australia would not be enough to meet east coast demand. Supply will fall by roughly 35% after 2023, according to the report. 

It comes as BHP announces the end of its Minerva gas field which reached the end of its life last year. Production from Minerva ceased in September. 

Otway Basin production will also hit east coast supply, unless field development of plant modification projects proceed. 

Several other Gippsland fields are also projected to reach their end of life between mid-2023 and mid-2024. 

There is also an added concern that there will not be enough pipeline capacity to deliver gas to market from northern states. 

The lack of supply could be so bad that during winter 2024 there could be supply gaps of between 13 terajoules and 374 TJ even at peak day production, according to the ‘Central Scenario' of the report. 

AEMO warned both government and industry had a role to play going forward, and one option on the table is redirecting LNG cargoes destined for the international spot market to domestic ports. 

Plans have been flagged for four terminals; however, they are very much in the early stages of development but analysis from S&P Platts yesterday found  import terminal developers are confident to have one up and running by 2022, despite Victoria recently lifting its conventional exploration moratorium. It's believed by most analysts supply will dwindle before new resources can be commercialised.  

Last year South Korean developer EPIK appointed ANZ as its financial advisor for its Newcastle GasDock LNG project in New South Wales.

Australian Industrial Energy, backed by Andrwe Forrest, also plans one and won ‘critical infrastructure' approval for its NSW Port Kembla terminal in 2018. 

The peak body representing the oil and gas sector, the Australian Petroleum Production Exploration Association acknowledged the responsibility of the gas industry but said it was doing all it could. 

"APPEA members are taking all steps necessary to ensure the production and delivery of gas supplies continues," APPEA chief Andrew McConville said. 

"With exploration at record low levels, low oil prices and COVID-19 pandemic meaning both gas demand and gas supply face challenges, the analysis reinforces how vital it is for all governments to support developing new gas supplies as quickly and as cheaply as possible."

According to the AEMO report, supply in the major consumer states of Victoria and New South Wales over the next few years will all but evaporate as legacy gas fields decline. 

Queensland and the Northern Territory will enjoy sufficient supply due to their shale and coal seam gas resources. 

Source: Energy News  Bulletin

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COVID-19 is already damaging our economy and now more than ever it is crucial to support local industry. We can start by promoting available business opportunities.

Energy Club NT is working with ICN NT and the Northern Territory Government to support business to business growth, promote local opportunities and the further localisation of supply chains during the COVID-19 crisis.

Through ICN’s online Gateway platform, a portal has been established to connect local Territory businesses to opportunities of all sizes.

We encourage our members to submit any business opportunities or problem statements to ICN for promotion to the local business community. We further encourage our members to express interest against the ‘Any opportunities’ package of work, to be notified of opportunities and also to promote these opportunities to the broader business community.

To list an opportunity on the portal businesses will need to:

• Download and complete the ‘Opportunity Listing Template’ available in the Project Documents on the page
• Email the completed form to ntopportunities@icnnt.org.au

Once assessed, your opportunity will be listed on the page and open for expressions of interest and/or direct business contact.

ICN NT is running this initiative free of charge to support local businesses during these challenging times.

Visit the Northern Territory Opportunites portal here:  ntopportunities.icn.org.au

"We are here to support our wide demographic of energy industry members and the local business community wherever we can. Please don't hesitate to reach out if there is anything I can do to assist you and your organisation."

Sonia Harvey

CEO - Energy Club NT

Media Contact: Kevin Peters  |  ICN NT  |  08 8922 9422

The Northern Territory’s resource sector As part of measures for controlling the transmission of COVID-19, the Northern Territory Government has implemented border controls,  effective from 4pm on Tuesday 24 March 2020. These controls, applied to all access points by road, rail, air and sea, apply to all people entering and leaving the Northern Territory (NT), including employers and employees operating across the NT’s resource sectors. These controls seek to protect the health of Territorians in reducing the spread of COVID-19.

What you need to know: Resource industry operations in the NT are considered ‘critical industries’. Specialists critical to maintenance of competitive operations of critical industries are considered ‘essential travellers’ and fall into exemption categories if they: are essential to operations must undertake time-critical work must be physically present, and cannot be temporarily replaced with workers sourced from within the NT. . Cross-border transit to work sites: Interstate employees and contractors will be assessed at border control points and should carry photo identification such as a drivers’ licence. Employers should provide transiting employees an authorisation letter stating their name, working dates, transit path and work location to show to border control staff. Workers who live in the NT and work interstate must satisfy the requirements of their destination jurisdiction. . Transport and freight: Non-residential transport and freight services are exempt from the border control arrangements and will continue to come in and out of the NT. This will not impact the delivery of essential goods and services. . Application for continued operations: Resource companies should submit an application for exemption to self-quarantine to the NT Chief Health Officer for merit assessment on the grounds that this class of persons, is governed by a COVID-19 management plan, imposed by the employer of the person or class of persons, to prevent the transmission of COVID-19 to the public. Applications should include:  company transmission prevention control measures in accordance with NT Department of Health advice and the Minerals Council of Australia/Australian Petroleum Production & Exploration Association Resources Sector National COVID-19 Response Protocols evidence of strategies to reduce staff movement to essential staff only evidence of measures to support isolation and contact tracing in the event it is necessary. Applications for exemption should be submitted to doh.pcc@nt.gov.au which are being reviewed with priority. Alister Trier Chief Executive

THIS week S&P Global Ratings said Santos has a “solid buffer” to withstand the low oil price thanks to its good work building the balance sheet these past three years while it also put Woodside Petroleum on a watchlist for a possible ratings downgrade.

Santos closed higher than its peers yesterday on the ASX, seeing a 20% rise in its share price compared to an overall energy sector rise of around 5%, helped along by S&P's afternoon release. 

"The company's recently announced measures to preserve cash should support the key ratio of funds from operations (FFO) to debt at between 20% and 25%" by the year's end," S&P said. 

That forecast takes in its price assumptions of $30/bbl oil for the rest of 2020, $50/bbl oil next year and $55/bbl oil in 2022. 

After the 2015-2016 price slump that sent the oiler into the red it "emerged with a more resilient business model," it said. 

"We believe Santos' production portfolio will outperform peers in a lower oil price environment, given that about 30% of Santos' production is domestic gas linked to the consumer price index."  

In addition, about 15% of the company's oil-linked liquefied natural gas portfolio will benefit from hedging at oil prices of below US$54/bbl over the next nine months." 

It helps that the company's LNG through 2020 is 95% contracted largely to South Korea and Malaysia. 

S&P also likes that the Adelaide company will reduce free-cash flow breakeven price to $25/bbl this year, part of a suite of moves announced by Santos Monday to survive low oil demand and even lower prices. It also committed to reducing capex by 38% this year. 

"In addition, some LNG price structures provide relief against a significant oil price drop, given the existence of LNG 'S' price curves, whereby oil price-linkage flattens at currently depressed prices," S&P said. 

While many contracts are up for price reviews the "scope for change is limited by contract terms," Santos chief Kevin Gallagher said some months ago. 

Santos also committed to delaying sanction for development of its Barossa gas field, which S&P sees as prudent. 

"We believe growth projects sanctioned in the current environment would indicate a heightened risk appetite, and would likely be negative for the company's credit profile," it said.  

Meanwhile this week it placed Woodside Petroleum on CreditWatch Negative suggesting "under our current oil price assumptions, including US$30 per barrel oil in 2020, we forecast that forecast funds from operation to debt could materially breach 30% in 2020 and thereafter, should the Scarborough-Pluto integrated project proceed. 

"We may lower the rating by at least one notch if Woodside is unwilling to take effective and timely actions to preserve its financial profile amid the significantly depressed oil and LNG markets and funding requirements associated with the Scarborough-Pluto LNG project."

Source: Energy News Bulletin

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