Industry News

Santos and its joint venture partners in the Barossa Gas Project today announced they will invest up to A$10 million in Northern Territory coastal Aboriginal communities and homelands as the development phase of the project progresses.

Investments will be aimed at improving community and homeland infrastructure and services as well as programs that enable Aboriginal people to maintain cultural practices and carry out cultural obligations, care for their country and establish pathways to skilled, well-paying, secure jobs and business opportunities.

In addition, the Barossa Gas Project joint venture partners announced they are supportive of establishing a fund from commencement of production (targeted for 2025), for the life of the project, to share the benefits of the project with Northern Territory coastal Aboriginal communities and homelands. The fund would aim to deliver intergenerational progress for Aboriginal Territorians and build a better future for the next generation.

The fund would invest over the long term in community and homeland infrastructure, cultural activities and services that improve health, education, housing, community resilience and economic outcomes for Aboriginal people in the Northern Territory. It would also invest in programs that enable Aboriginal people to maintain cultural practices and carry out cultural obligations, care for their country and build capacity to establish new pathways to skilled, well-paying, secure jobs and business opportunities for Aboriginal Territorians.

Santos, as operator of the Barossa joint venture, has been engaging with Aboriginal leaders from the Tiwi Islands, East Arnhem, West Arnhem, Darwin-Daly-Wagait and Victoria River District regions during 2023. It is intended that Aboriginal people will have a real voice in establishing governance arrangements and the investment mandate for the fund, and in selecting priority projects for funding.

Santos Chief Executive Officer and Managing Director Kevin Gallagher said the Barossa joint venture partners are committed to real and practical action to help close the gap on Aboriginal disadvantage in the Northern Territory.

Mr Gallagher said, “Training, education and good jobs are a universal foundation for human progress. They are the building blocks for individual social and economic empowerment, and just as importantly, for stronger, more resilient families and communities. Achieving better employment outcomes for Aboriginal Territorians[1] depends on investments such as Barossa gas and Darwin LNG (DLNG) life extension to provide new job, business and other opportunities.

“The Barossa gas and DLNG life extension projects are already training and employing Aboriginal Territorians, and we plan to do much more, including through Santos and DLNG’s recent announcement of a new jobs program with KAEFER, our valued partner providing scaffolding, mechanical and fabric maintenance services for the DLNG plant.

“This program has already been a resounding success with over 90 applicants to date. Fifteen Aboriginal trainees and apprentices will start with KAEFER at the end of February with a second group to commence in the May/June period later this year.

“Sharing the benefits of projects like Barossa is a meaningful step we can take towards closing the gap,” Mr Gallagher said.

The details are intended to be finalised in consultation with Aboriginal leaders and other stakeholders prior to the commencement of production. Benefits can only be shared as the Barossa development progresses, which is subject to regulatory approvals.

Quotes attributable to Minister for Mining, Mark Monaghan:

“The Territory Labor Government fully supports the Barossa Gas project, and deeply understands investment into remote areas underpins greater outcomes for the wider community.

“Santos is bridging the gap between private companies and traditional owners by creating positive, long lasting change through a new community benefit fund which will open more doors to access better health care, education and infrastructure.”

Quotes attributable to Minister for Environment, Kate Worden:

“This funding commitment from Santos shows the role the resource industry has in creating stronger communities and providing a career path for indigenous Territorians.

“This is an example of how the resources sector can work with remote communities to improve outcomes for those communities and make a lasting impact through training and infrastructure.”

[1] In 2021 only 31 per cent of Aboriginal people aged 15 to 64 years of age were employed in the NT, unemployment stood at 8 per cent and 61 per cent were not in the labour force at all. Employment outcomes have declined over the last 15 years or more. (https://www.aihw.gov.au/reports/australias-welfare/indigenous-employment)

Source: Santos

To view the full media release, click here.

Power and Water has joined the celebration to mark the first large-scale solar generator on the Darwin-Katherine electricity network to achieve commercial dispatch of energy at 100% of the plant’s capacity.

This important milestone for the Northern Territory electricity market and the Territory’s progress towards a 50% renewable energy future follows effective collaboration between Defence and Power and Water to bring the RAAF Darwin solar generator online safely.

As the Network Owner and System Operator, Power and Water has a responsibility to ensure that new connections to the electricity network meet the standards and guidelines that maintain a reliable electricity supply to customers.

‘Safety is a core value for Power and Water. For us, that’s the safety of our people and our customers – and it’s also the safety and reliability of the services that we deliver to Territorians,’ Power and Water Chief Executive Officer Djuna Pollard said.

In addition to the RAAF Darwin solar system, there are 5 large scale solar generators connected to the Darwin-Katherine electricity network. The proponents are at varying stages of testing and commissioning before they can reach full commercial dispatch.

Power and Water continues to support proponents to progress their projects towards commercial operation, including negotiating conditions for partial dispatch - where network conditions for stability and security can be managed - prior to achieving full commercial dispatch.

‘We are pleased to be working closely with Defence on other renewables projects, as well as a number of other large scale solar generator projects in the Northern Territory, and look forward to continuing this collaborative relationship,’ Ms Pollard said.

Ends.

Contact: Media unit

Phone: 0401 117 599

Source: PowerWater

Falcon Oil & Gas Ltd. (TSXV: FO, AIM: FOG) is pleased to announce the commencement of the 30-day initial production (IP30) testing at the Shenandoah South 1H (“SS1H”) well in EP117, operated by Falcon Oil & Gas Australia Limited’s joint venture partner, Tamboran B2 Pty Limited.

Full details of the press release can be found on our main website homepage, under the Investor Centre section selecting Press Releases or clicking on the following link -> SS1H IP30 Commencement

Source: Falcon Oil & Gas Ltd

Charles Darwin University (CDU) has produced hydrogen in the Northern Territory for the first time.

The University and the Northern Territory has today taken a step forward in the goal to establish a hydrogen generation industry. 

CDU will use the unique facility to develop skilled workers who are crucial for a successful renewable energy and green hydrogen industry in the Northern Territory. The facility will also serve as an innovation platform for industry through testing new hydrogen and other renewable technologies.

The hydrogen electrolyser and fuel cell system play an important role in a sustainable and efficient energy cycle for hydrogen production and utilisation.

The electrolyser, through electrolysis, splits water into hydrogen and oxygen gases. The generated hydrogen is stored for future use. The fuel cell combines hydrogen with oxygen from the air to produce electricity with no harmful emissions CDU’s interconnected system offers a green energy solution. 

Pro Vice-Chancellor of the Faculty of Science and Technology and Director of the Energy Resources Institute, Professor Suresh Thennadil said this equipment upgrade is key in enabling exploration into hydrogen. 

“The installation of a containerised hydrogen electrolyser and fuel cell system, significantly enhances our ability to study hydrogen production and its feasibility as an energy source for fuelling the grid,” Professor Thennadil said. 

“This will also enable us to better understand the challenges and intricacies associated with incorporating hydrogen as an additional energy source as well as the durability of electrolysers and other components under local climatic conditions.

“This upgrade provides a unique and flexible platform to study renewable energy systems, particularly small regional and remote grids, which are common throughout the NT."

CDU collaborated with Pacific Energy, a specialist in designing and building power generating assets, to design, install and commission a containerised system that houses the electrolyser and fuel cell. 

The system has been installed at CDU’s Renewable Energy Microgrid Hub for Applied Research and Training (REMHART) facility in East Arm to further research and training. A transportable containerised system offers potential benefits for use in remote communities.

The REMHART facility aims to foster collaborative research with various industries, and government, to find innovative solutions to the challenges associated with the design, deployment, and operation of renewable energy systems.

The Northern Territory Government has a strategy in place to be an Australian centre for hydrogen technology research, production and use. 

Deputy Vice-Chancellor Research and Innovation Professor Steve Rogers said the unique state-of-the-art facility is the corner stone in supporting the Government’s vision for a renewable energy future. 

“It is important to us that renewable energy industries flourish in the NT, we achieve our decarbonisation goals, and we address the energy security of remote communities,” Professor Rogers said. 

“Our REMHART facility aims to pioneer the development of affordable, reliable, and eco-friendly power systems by providing a dedicated space to create and test new technologies.

“This represents a practical stride towards sustainable energy solutions in the NT."

The REMHART facility was established and enhanced with $2 million of funding from the Commonwealth Government through the Strategic University Reform Fund (SURF) program. 

Federal Member for Solomon Luke Gosling OAM MP said by 2050, Australia’s hydrogen industry could generate $50 billion in additional GDP and create more than 16,000 jobs in regional Australia – including here in Darwin.

“The Northern Territory has the resources, technical skills and track record with international partners to seize this opportunity and become a global hydrogen powerhouse,” Mr Gosling said. 

“Commonwealth investment in projects like the Hydrogen Electrolyser and Fuel Cell System ensure we don’t get left behind as the rest of the world continues to move forward.”

During the testing phase, the system has produced hydrogen with the fuel cell producing 5kW of electrical output. 

Pacific Energy’s Chief Executive Officer Jamie Cullen said the company was pleased to collaborate with CDU to deliver this hydrogen production and storage system (H2 SPS) which would play a critical role in developing the energy industry’s understanding of hydrogen as a renewable energy source.

“At Pacific Energy, we are keenly focused on transitioning Australia, and the world, to a clean energy future. That’s why we’re excited to be a part of projects like this one, which will help us overcome some of the challenges we currently face when integrating hydrogen into the renewables mix,” Mr Cullen said.

“We’re incredibly proud to work with Charles Darwin University to deliver our first H2 SPS to them, which we designed and manufactured locally at our facilities in Darwin and Perth, and we’re looking forward to seeing how it supports the university in its important hydrogen studies.”

Source: Charles Darwin University 

To view the media release by Pacific Energy, click here.

Robust sales revenue, production and free cash flow

• Sales revenue of US$1.5 billion in the fourth quarter.
• Fourth quarter production of 23.4 mmboe was slightly higher than the prior quarter primarily due to increased sales gas production. FY production of 92.2 mmboe pre-PSC (91.7 mmboe post-PSC) is at the top end of full year guidance.
• Bayu-Undan continuing to produce with gas being delivered into the Australian domestic market until end of field life.
• Strong free cash flow from operations of over $500 million in the fourth quarter and $2.1 billion for the full year. Free Cash Flow Breakeven Price of less than $28/bbl unhedged for the year.
• Net debt of $4.3 billion and gearing at 18.4 per cent excluding operating leases at 31 December 2023 (21.8 per cent when included).

Development projects progressing well

• The Barossa Gas Project is now 66.4 per cent complete. Following approval of the revised Drilling and Completions Environment Plan on 15 December 2023, drilling has now recommenced.
• The Federal Court discharged the injunction preventing pipelaying along part of the Barossa Gas Export Pipeline route on 15 January 2024. One-third of the pipeline has been installed to date.
• The Darwin Pipeline Duplication Project received Northern Territory Environmental Approval on 22 December 2023. The pipeline will transport Barossa gas to Darwin LNG and free up the existing Bayu-Undan pipeline to transport Barossa reservoir CO2 for carbon capture and storage in depleted reservoirs at Bayu-Undan.
• The Pikka Project was 37.4 per cent complete at 31 December 2023, progressing on time and on budget. Rig operations were completed on five wells and work is under way on the sixth well. Two wells have been stimulated with one successfully flowed back and one currently undergoing flow back operations. Flow back results are in accordance with prognosis.
• In PNG, the first of two Angore wells was successfully drilled and production liner run to well total depth. Reservoir characteristics align with pre-drill expectations.

Santos Energy Solutions is tapping into strong regional demand for CCS

• The Moomba CCS Project is 80 per cent complete with first injection on track for mid-2024. Moomba CCS is targeting injection costs of ~US$24 per tonne lifecycle breakeven, putting it at the lower end of the global CCS cost curve. Depending on available CO2 volumes, Moomba CCS could store up to 1.7 million tonnes of CO2 per year, equivalent to 10 per cent of the annual average emissions reduction rate needed to meet Australia’s 2030 and 2050 emissions targets.
• Flow testing on all four injection wells for Moomba CCS has been successfully completed.
• An MOU was signed with two major Japanese energy companies JX and Eneos to evaluate the potential to capture, transport and sequester emissions from Japan, which could support the expansion of Moomba CCS, with Phase 2 potentially storing third party CO2 from customers and hard-to-abate industrial sources.
• Bayu-Undan CCS project FEED is 85.5 per cent complete. Legislation passed the Australia Parliament to enable cross-border transfer of CO2 to and from Australia.
• Four additional nature-based projects registered by Santos and its partners to qualify for generation of emissions reduction units in both voluntary and compliance markets globally.  Along with our PNG Markham Valley project, Santos nature-based portfolio now has the potential to generate over 10 million tonnes of emissions reduction.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said the strong underlying business performance, combined with a disciplined focus on operational excellence, delivered a strong fourth quarter finish for 2023.

“The fourth quarter brought free cash flow for the full year to $2.1 billion, an outstanding achievement in what has been a challenging year. It positions us well to deliver shareholder returns, backfill and sustain our existing business, complete our major projects, Barossa and Pikka, progress our decarbonisation plans and grow our Santos Energy Solutions business,” Mr Gallagher said.

“I am very pleased to see that the Barossa pipelaying and drilling activities are now fully under way with first gas still expected in 2025. Given the challenges of the past two years, we have updated our cost and schedule guidance for the project. The team has done a great job in keeping Barossa close to the original schedule and managing the costs of delay.

“Our Moomba CCS project is on track for first injection this year and I believe it will be a game-changer for decarbonising Santos and also provide decarbonisation opportunities for other companies and hard-to-abate sectors.

“Our operational focus for 2024 is the execution of the Barossa, Pikka and Moomba CCS projects whilst maintaining a strong balance sheet.

“As previously announced Santos is in early-stage discussions to evaluate the merits of a potential merger with Woodside. The parties have agreed to exchange information to assess the benefits for our shareholders. Santos continues to consider alternative options to accelerate value for shareholders. There is no certainty that any transaction will eventuate from these discussions.” Mr Gallagher said.

Source: Santos

To view the full fourth quarter report, click here.

The underlying business of Armour Energy Group owned by its operating subsidiaries, has emerged from administration and is now in a position to continue developing its high-quality portfolio of Australian energy assets under the ownership of privately-owned ADZ Energy Pty Ltd (ADZ Energy).

Armour Energy Group was placed into voluntary administration and receivership on 10 November 2023. Following a meeting of creditors held by McGrathNicol’s Mark Holland, Damian Pasfield and Jonathan Henry on 19 January 2024, the ownership of Armour Energy Group’s underlying business transitioned to ADZ Energy on 22 January 2024.

ADZ Energy has a clean and strong balance sheet, a supportive new shareholder in ADZ Holding Group and a clear path to development of its extensive portfolio of exploration and production assets.

ADZ Energy will remain focused on accelerating gas and liquids production from its Kincora Gas Project in Queensland, which provides much-needed energy for the east coast domestic market. The Group’s portfolio includes high-quality oil and gas prospects across multiple basins with a range of project maturity that will realise near-term value accretion and mid- to long-term transformational growth across its Northern Territory1, Victoria and South Australia jurisdictions.

The management team, led by Chief Executive Christian Lange, will remain in place and continue to be headquartered in Brisbane.

Mr Lange said the Company’s focus remained on safe and environmentally responsible development.

“Under new ownership, ADZ Energy has a bright future as a fast growing and dynamic explorer and energy producer focused on being a proud contributor to the communities in which we operate,” Mr Lange said.

“ADZ Energy Group and the management team thank all our stakeholders, including our talented and dedicated employees and the customers and suppliers that partner with our business, for their patience and support during the administration period. Together, we will continue to keep downward pressure on domestic energy prices and support Australian manufacturing and employment.”

KordaMentha’s Richard Tucker and Robert Hutson retired as Receivers and Managers on 22 January 2024. McGrathNicol will now proceed to wind up residual Armour Energy Group corporate entities.

¹ Pending completion occurring under the Asset Sale Agreements between ADZ Holding and Armour Energy Limited (in liquidation) and McArthur NT Pty Ltd (in liquidation) in relation to the NT tenements.

Source: ADZ Energy 

To view full media release, click here.

Highights

• Empire acquired the Roslind Park Gas Plant (“RPGP”) from AGL Limited for $2.5 million in cash, significantly accelerating the path to Carpentaria Pilot Project production and reducing the capital expenditure required to commence gas sales 

• R&D Tax Offset for FY2022 of $15.6 million in cash received. Proceeds applied to debt reduction and working capital including FID expenses

• Carpentaria Pilot Project is progressing towards a final investment decision (“FID”) 

• A key Northern Territory gas field continues to produce below contracted volumes leaving the Northern Territory domestic market short of gas 

• Ms. Karen Green appointed as an independent Non-Executive Director and Chair of the Audit & Risk Committee effective 17 November 2023 

• Cash at the end of the Quarter was $17.3 million

Source: Empire Energy Group

Follow the links below to view the full ASX announcements:

Quarterly Activities Report as at 31 December 2023: Activities Report

Quarterly Cashflow Report as at 31 December 2023: Cashflow Report

The hydrocarbon, helium and hydrogen exploration and production company lodged its Environmental Management Plan for the EP 145 project in Australia.

This EMP is pending approval and Mosman Oil and Gas awaits certification required for a seismic exploration programme later in 2024.

“I am pleased these two milestones in the exploration and Farmin Agreement process have been reached,” Mosman chief executive officer Andy Carroll said.

“This keeps us on track to acquire seismic in 2024 and then drill in 2025 to test the helium, hydrogen and hydrocarbon potential in this area.”

Mosman has lodged the Environmental Management Plan (EMP) with the Northern Territory Government. Approval of the EMP and re-issue of the Aboriginal Areas Protection Authority (AAPA) Certificate are the two remaining approvals required prior to the acquisition of 2D seismic, scheduled for 2024.

Completion of the Farmin Agreement announced in October 2023 is subject to government approval of the proposed change of operator and transfer of interest.

The farminee, Greenvale, has advised that it has received the Stamp Duty assessment and paid the amount due.

The next step is Ministerial approval, which is expected to proceed now that stamp duty has been paid.

Mosman is not in control of the timing of Ministerial approval, but based on progress so far anticipates completion to occur in the near future.

Source: Energy Today

The Santos Darwin Pipeline Duplication Project has been given environmental approval following an assessment by the independent NT Environment Protection Authority (NT EPA).

The Environment Protection Act 2019 requires an environmental impact assessment and separate environmental approval for all projects that have the potential to have a significant impact on the environment.

Santos is developing the Barossa Gas Export Pipeline to bring gas from the Barossa reservoir in the Timor Sea, to Darwin. The NT EPA assessed the Santos Darwin Pipeline Duplication Project, which is the section of the pipeline in Northern Territory waters.

The pipeline duplicates a section of the existing Bayu-Undan pipeline, which is proposed to stay in place to provide Santos with the option of repurposing it to transport CO₂ to the depleted Bayu-Undan reservoir for sequestration.

The NT EPA considered potential significant impacts from the project including on the marine environment, culture and heritage and from greenhouse gas emissions.

The environmental approval includes conditions to ensure potential environmental impacts are managed to an acceptable level.

The Barossa Gas project is worth $6.4 billion dollars to the NT economy and will create 600 local jobs through construction, and hundreds more over the next two decades.

The environmental approval can be viewed on the Department of Environment, Parks and Water Security website: https://depws.nt.gov.au/environment-information/environmental-assessment-and-approvals/environmental-approvals

Quotes attributable to Minister for Environment, Climate Change and Water Security, Kate Worden:

“The Santos Darwin Pipeline Duplication project has been through a rigorous environmental assessment by the NT EPA. I have applied the NT EPA’s recommended conditions and granted the environmental approval.

“The Territory Government has supported this project from the beginning. Gas will play a critical role in supporting our transition to renewables, ensuring ongoing energy security for Territorians as we head towards net zero.”

Quotes attributable to Minister for Mining Mark Monaghan:

“The Northern Territory is in a strong position to become a global leader in low-emissions energy exports.

“Our Government congratulates Santos on the Federal court ruling and for being granted NT EPA approval, we look forward to seeing this project and industry as a whole progress.

“The $6 billion Barossa Gas project is significant for the Territory’s economy and secures hundreds of local jobs for the next two decades, all while being pivotal in the world’s transition to a cleaner, greener future.”

Source: Northern Territory Government Newsroom

Santos welcomes the decision of the Federal Court of Australia today in the case of Munkara v Santos NA Barossa Pty Ltd (No.3).

The decision was in favour of Santos, with the Court dismissing the application and discharging the injunction that prevented pipelay activities south of the kilometre 86 (KP86) point along the Barossa Gas Export Pipeline.

As per the ruling and in accordance with the Environment Plan in force for the activity, Santos will continue pipelaying activity for the Barossa Gas Project (Barossa).

More information on the Barossa Gas Project can be found here.

Ends.

Source: Santos

To view the ASX announcement, click here.