Industry News

An impending and material cut to the Northern Territory gas supply is exacerbating the looming East Coast gas crisis.

Production at the Blacktip gas field, offshore in northern Australia, has fallen faster than expected, raising fears about energy security both within the NT and further afield.

Gas from Blacktip, which is owned by Italian multinational Eni, is used to generate electricity for Top End users, with any excess piped to East Coast markets. Production peaked in 2019 at about 100 million cubic feet per day and has declined ever since.

It fell by about 50 per cent last year – a trend that has worryingly continued into 2023.

The stark cut in production resulted in a two-month shutdown last year of the northern gas pipeline between the NT and the East Coast gas grid, the only pipeline link.

And the situation does not look like it will be improving at Blacktip any time soon. The NT Power and Water Corporation recently advised Incitec Pivot about potential gas reserves issues at the Blacktip gas field, with a cut to forecast supply under the parties’ gas supply agreement from this month.

The cut in Blacktip production adds to both State and national concerns in relation to energy security, as the only other gas production in the NT comes from Central Petroleum’s Amadeus basin gas fields.

However, this does pave the way for new sources of production, with the NT Government likely to be highly-supportive of any new gas supply projects – amenable to a potential saviour, if you like. The Beetaloo Basin, within the Greater McArthur Basin and said to host some 500 trillion cubic feet of in-place gas resources, appears to be a standout option.

Holding the biggest tenement position across the Beetaloo-McArthur Basins is Empire Energy Group, which is maturing its portfolio of onshore, long-life oil and gas opportunities. Already an early mover in the Beetaloo, Empire’s path to first gas production is now on an accelerated schedule amid the looming East Coast gas shortage.

There have previously been questions around whether there was a big enough domestic market to warrant development of the scale of Empire’s greeneld, unconventional gas project. But with the production drop from the Blacktip eld and long-term gas supply issues, success at the project could clearly help bolster future domestic supply.

Empire Energy Group managing director Alex Underwood said: “The production issues at the Blacktip Gas Field that provides energy for electricity generation for the people of the NT, power for NT mining operations and industrial activities as far as Mount Isa and the East Coast, underscore the critical importance of gas for our households and economy. Empire is rapidly progressing towards pilot production from the Beetaloo, aiming to be producing sales gas by early 2025. This will provide the NT with energy it needs, putting downwards pressure on power bills and enabling economic growth.”

Beetaloo’s in-place gas resources are from entirely within the middle Velkerri B layer of the Mesoproterozoic Roper Group – where Empire is targeting. While only a handful of horizontal wells have been drilled to date, Velkerri B is the most prospective of the stacked, organic-rich shales of the Roper Group.

It is where both the Santos-Tamboran and Origin-Falcon joint ventures made big steps with lateral wells across the basin.

Amid accelerating urgency for new gas supply options, Empire substantially increased the contingent resources of its wholly-owned EP187 permit late last month to what it says is now a “nationally signicant resource”. An independent review lifted the estimated 2C contingent resource by 270 per cent to a sizable 1739 petajoules.

The material upgrades in contingent resources to LNG scale help make the case to accelerate towards an early gas development option.

Empire further solidified its potential to step in and help fill the supply shortage by recently confirming critical commercial flow rates from its Carpentaria-2H gas well, its first horizontal well into the Beetaloo sub-basin. It pulled up an impressive 323 terajoules, or 281 million standard cubic feet (mmscf), over 127 days. That equated to a normalized rate of 2.75 terajoules (2.4 mmscf) each day per 1000m.

The impressive flow rates have already elicited the attention of multiple parties, who have expressed strong interest in buying Empire’s Beetaloo gas in both the pilot phase and full development phase.

With a recent green light from the NT government to move into production, along with adequate capital resources, Empire is now progressing towards development drilling and – more importantly – cash flow. A final investment decision on an initial gas project is due by the year’s end ahead of the anticipated first gas production in 2025. 

Source: Business News via Empire Energy Group

Snippet of article can be viewed here

Top End Energy Limited (Top End or the Company) (ASX:TEE) is pleased to announce that the exploration agreement for Exploration Permit (EP) 258 (the Permit) in the McArthur Basin, Northern Territory, has now been executed. The execution of the agreement paves the way for the formal grant of the Permit.

HIGHLIGHTS

• Execution of the Exploration Agreement between the Company and the native title holders of EP 258

• Critical step for achieving grant of the Permit, which would represent the first EP to be granted in the Northern Territory since 2015

• Grant of the Permit expected in the coming weeks

EXPLORATION AGREEMENT WITH NATIVE TITLE HOLDERS

The Company announced in April 2023 that the Northern Land Council (NLC) had received instructions from the native title holders of EP 258 for the Top End (Default PBC/CLA) Aboriginal Corporation (Top End PBC) to enter into the agreement which governs the terms and conditions for exploration on the Permit (the Exploration Agreement).

The Top End PBC is the native title body corporate acting as the agent for the native title holders. Pursuant to the NLC’s internal processes, the Exploration Agreement has now been executed by the Top End PBC and the Company.

Execution of the Exploration Agreement has been a critical path item to achieving grant and, subject to final approval from the Northern Territory Government, we expect formal grant to occur in the coming weeks. 

To view full ASX announcement, click here.

Highlights

• The Northern Territory Government has provided Tamboran exclusivity over 170-hectares (420- acres) on the Middle Arm Sustainable Development Precinct (Middle Arm) for a proposed LNG development, Northern Territory LNG (NTLNG). NTLNG is expected to be supported by low reservoir CO2 gas from the Beetaloo Basin.

• The Middle Arm acreage has been allocated on a “Do Not Deal” basis for twelve-months, allowing Tamboran to progress a Concept Select phase for a proposed NTLNG development.

• The site under exclusivity is expected to host a Liquefied Natural Gas (LNG) development with an initial capacity of 6.6 million tonnes of LNG per annum (MTPA), with the potential for expansion, subject to completion of the Concept Select study, successful Beetaloo appraisal drilling and flow testing, and Government approvals.

• NTLNG represents the first fully integrated onshore LNG development in Northern Australia where upstream, midstream and downstream production and processing are based in the Northern Territory.

• Tamboran is targeting first LNG production by 2030, with a near-term commitment to ensure Australia’s Northern Territory and East Coast gas markets are well supplied.

• FEED studies remain ongoing for the proposed 100 million standard cubic feet per day (mmscfd) domestic pilot development, with volumes contracted to Origin Energy for 10-years.

To view full release, please click here

The Northern Territory Government has today taken the next big step towards developing the Middle Arm Sustainable Development Precinct as a new clean energy, investment and jobs powerhouse.

Powered by renewables and lower-emissions energy, the precinct is being developed to attract industries that reflect what the Territory’s future economy will look like – including hydrogen, carbon capture, natural gas, advanced manufacturing and minerals processing.

To give interested companies certainty as they develop projects at Middle Arm, the Territory Government has issued ‘not to deal’ commitments to five proponents over specific parcels of land at the precinct.

These commitments mean that their preferred sites in Middle Arm will be set aside for up to 12 months to provide each proponent confidence and certainty to continue developing their proposals. The proponents are:

·       TEH2, 100% owned by Total Eren – renewable energy: a global independent power producer, is proposing to develop a green hydrogen production facility using solar energy with the capability of producing more than 80,000 tonnes of renewables-based hydrogen per annum for domestic and export potential.

·       Fortescue Future Industries (FFI) – renewable energy: the global green energy company, is proposing to develop a green hydrogen hub, comprised of green hydrogen and green ammonia production and export facilities.

·       Tivan – critical minerals: is proposing to produce vanadium oxides through application of innovative downstream processing technology using feedstock sourced from Tivan's Speewah and Mount Peake Projects; titanium dioxide and iron oxide also produced as by-products. Tivan is also working to facilitate an industrialisation pathway for vanadium redox flow batteries.

·       Tamboran Resources Limited – natural gas: a lower CO2 emissions liquefied natural gas (LNG) export facility.  Gas from this export facility will play an important role in the decarbonisation plans of our neighbours and trading partners in Asia and beyond.

·       Avenira – critical minerals: is proposing a lithium-ferro-phosphate (LFP) cathode manufacturing facility, which will manufacture pre cursor battery cathode materials from critical minerals, including phosphate sourced from the Wonarah Project in the Northern Territory.

Collectively, these projects represent tens of billions of dollars in capital investment, with the entire Middle Arm development creating around 20,000 jobs in the Territory.

These companies will now progress their facility designs, engineering work and pre-feasibility studies and environmental approvals.  They will be required to comply with all conditions set by the NT EPA as part of the Strategic Environmental Assessment process for the precinct which is currently underway.

The Northern Territory is positioned to be a global leader in low-emissions energy export and critical minerals processing, taking advantage of our world-class solar and energy resources, and meeting strong international market demand to facilitate energy transition globally.

Middle Arm is attracting significant interest and will enable the development of an interconnected hydrogen industry and utilise carbon capture, to accelerate low emission industry development.

A Carbon Capture Utilisation and Storage Hub as part of the Middle Arm Sustainable Development Precinct will also be developed to mitigate emissions from existing and future natural gas processing, and will accelerate low-emission industry development, including hydrogen production.

Middle Arm is one of the most exciting and significant sustainable economic developments in the nation, and it will support thousands of jobs for Territorians.

Quotes attributed to Chief Minister Natasha Fyles:

“Middle Arm is about building the Territory’s future. This is about new sources of renewable and low-emissions energy, new investment, new industries, and most importantly, new jobs for Territorians.

“I can give you 20,000 good reasons why this is important. This will create new, permanent, long-term jobs for the Territory, and that’s what matters to me. Clean energy jobs are the future, and that’s the future we’re building for the Territory.

“We’re absolutely committed to growing our economy while also transitioning to net zero emissions, and Middle Arm will play a huge part in that transition. This is what responsibly decarbonising and diversifying our economy looks like.

“We’ve always said that sustainability will be at the core of Middle Arm, and our focus on clean energy demonstrates that. An environmental strategic assessment is underway now for the entire precinct.

“A lot of nonsense gets spouted about Middle Arm, but today’s announcement shows the Territory, investors and the rest of the country just how committed my government is to making this a reality.”

Source: NT Government newsroom

INPEX CORPORATION today announced its entity INPEX Operations Australia Pty Ltd (“INPEX”) has been jointly awarded an A$ 1 million ‘Regional Hydrogen Hubs’ grant1 from the Australian Government to conduct a feasibility study into the growth potential of a clean hydrogen market in Darwin, northern Australia.

The Darwin Clean Hydrogen Hub joint study between INPEX, Santos, Xodus and Australia’s national science agency CSIRO will explore opportunities to provide clean hydrogen solutions – with domestic and international hydrogen supply chains as potential beneficiaries.

Tetsu Murayama, INPEX President Director Australia, said the company is appreciative of the Australian Government’s A$ 1-million grant, to deliver vital studies assessing the potential of a Darwin-based Hydrogen Hub.

“The INPEX-led Darwin Clean Hydrogen Hub joint study has the potential to inform future investment decisions contributing to northern Australia’s hydrogen value chain development.

“Having played an active role in the Darwin business community for many years, we are proud to be supporting the Northern Territory’s cleaner energy future through this study,” Mr Murayama said.

The joint study also directly complements the current CSIRO-led Low Emission Hub business case being conducted with INPEX, Santos, Woodside Energy, Eni, Xodus and the Northern Territory Government.

The Darwin Clean Hydrogen Hub joint study represents a forecast 18-month program focusing on:

• market demand for hydrogen and its derivatives (e.g. methanol and ammonia) as fuel in transport and power generation, and feedstock for chemicals

• renewable energy sites and infrastructure for water electrolysis to produce and deliver hydrogen and its derivatives to market

• hydrogen production from natural gas and carbon capture and storage capacity requirements

• bulk and distributed storage requirements, and,

• domestic and international hydrogen supply chains.

1 “Regional Hydrogen Hubs: Development and Design Grants” program.

INPEX seeks to develop a hydrogen business, which is one of the five net-zero businesses outlined in the company’s INPEX Vision @2022. The company plans to commercialise three or more projects globally by around 2030 and aims to produce and supply 100,000 tonnes or more of hydrogen/ammonia per year.

To view full release, click here.   

Source: INPEX

The Territory Labor Government has awarded a tender for a wind generation study, which will inform near–term deployment of wind collection technology to gather data to de-risk and fast track investment.

Global consulting company Jacobs will deliver the study from its office in Darwin, with a clear commitment to deliver local benefits and initiatives to support local employment and industry development.

The study will identify prospective locations for large-scale wind generation in the Territory and develop a wind measurement strategy. The final study is expected to be delivered later this year.

While the Territory’s solar resources are well recognised, the Territory could also have strong wind resource potential. Currently there is limited publicly available information to assist prospective proponents and investors to undertake more detailed assessments of the Territory for large-scale wind generation.

In Budget 2023, the Territory Government allocated $1.7 million to accelerate hydrogen industry development. A key priority is to better understand the Territory’s wind resource potential, and to compile and publish pre-competitive data relating to wind resources for renewable energy generation.

Large-scale renewable energy generation and storage is necessary to achieve the Northern Territory’s strategic objectives, including 50% renewable energy and a $40 billion economy by 2030, and net zero emissions by 2050.

Quotes attributable to Minister for Renewables and Energy Selena Uibo:

“The wind study will provide the information necessary to understand the potential to use wind as an alternative renewable energy resource in the Territory.

“This study could unlock new opportunities for renewable energy development in regional and remote areas of the Territory, creating new local jobs and boosting regional economic development.

“Diversification of the Territory’s renewable energy opportunities is critical to our pathway to a net zero emissions future.”

Quotes attributable to Michael Christie, Director of Operations Northern Australia at Jacobs:

“With a 40-year history in the Northern Territory, Jacobs is excited to be part of this project and to support the Territory Government’s renewable energy development.

“We bring strong experience working on wind farm projects not only in Australia, but also globally.”

“Climate change is a key element of Jacobs’ strategic focus, and we are working with a variety of government and private clients to support decarbonisation and renewable energy sources for the long term. We look forward to working in partnership with the Territory Government to identify potential wind energy opportunities".

Source: NT Government Newsroom

Australia’s oil and gas industry has launched a new public awareness campaign, Natural Gas – Keeping The Country Running, highlighting the importance of natural gas to the nation.

The national campaign will highlight the many roles natural gas plays in society – creating products critical to everyday life, delivering substantial economic benefits, supporting tens of thousands of jobs and reducing emissions to help Australia reach net zero by 2050.

Australian Petroleum Production & Exploration Association (APPEA) Chief Executive Samantha McCulloch said while most people knew gas fueled their barbecues, stoves and heaters, many were unaware of the critical role of gas in so many other aspects of their lives.

“Natural gas is keeping Australia running on the path to net zero,” Ms McCulloch said.

“This public awareness campaign will explain how gas is ensuring reliable energy for millions of Australian households and businesses while supporting renewables and emissions reductions.

“Gas is important to the Australian way of life in so many ways.

“Gas is a natural ally of renewables and is playing a growing role to keep the lights on as coal retires, backing up solar and wind as a stable and reliable source when renewables are unavailable.

“Gas supports tens of thousands of jobs in manufacturing and then there’s all the things in our homes made with the help of gas.

“If we removed gas-related products, so much of what we rely on everyday would disappear: beer bottles, the bricks that build our homes, glass in buildings, packaging and paper as well as fertilisers for agriculture.”

Natural gas facts can be found at the campaign website, futureofgas.com.au.

View the campaign video here.

Ms McCulloch said the campaign would run across all media platforms in every state of Australia.

“Gas has never had a more important role to play in our energy mix and this campaign will share the many ways in which gas is central to our economy and everyday lives,” she said.

“The Australian gas industry is committed to playing its part to ensure the best outcomes for Australia throughout the energy transformation.”

 Source: APPEA

Major EP187 contingent resources upgrade

LNG scale discovered resource delineated in EP187 

• Successful 2022 Beetaloo work program has resulted in the certification of an LNG scale resource as independently assessed by Netherland, Sewell & Associates, Inc. (“NSAI”) for Empire’s wholly owned and operated EP187

• Due to the high calorific value of the Empire’s EP187 gas, NSAI assessed sales volumes in PJ have a higher energy content than equivalent dry gas volumes.

For full ASX announcement, click here.

Atlassian co-founder Mike Cannon-Brookes and his investment partners have emerged as the owners Sun Cable after a near six-month sales process following the collapse of the company behind a vast solar energy project.

Sun Cable, which intends to construct a large solar plant in Australia’s north before shipping power to Singapore using an undersea cable, fell into administration in January after Mr Cannon-Brookes fell out with the company’s other major shareholder, Fortescue Metals chairman Andrew Forrest.

Mr Cannon-Brookes’ private investment vehicle, Grok Ventures, will acquire Sun Cable after winning a bidding process run by FTI Consulting. The investment is backed by Quinbrook Infrastructure Partners, as first flagged by The Australian Financial Review’s Street Talk column on Thursday.

Mr Cannon-Brookes said the agreement was a “big step in the right direction” for the project. “We’ve always believed in the possibilities Sun Cable presents in exporting our boundless sunshine, and what it could mean for Australia. It’s time to stretch our country’s ambition,” he said.

“We need to take big swings if we are going to be a renewable energy superpower. So swing we will.”

Grok and Quinbrook intend to spend several weeks undertaking more detailed work with Sun Cable management before outlining their development priorities for the project. Dr Forrest had intended not to proceed with the 4200-kilometre undersea transmission cable between Darwin and Singapore if he was successful in acquiring the company.

The company has been tipped to need $35 billion in project funding. The cable was the bone of contention between the two billionaires and sparked the public rift between them – as well as the administration.

Dr Forrest said he remained “unconvinced of the commercial viability of the Australia-Asia Powerlink”, adding that his company, Squadron Energy, “did not participate in the final binding bid process for Sun Cable”.

“Squadron decided the capital allocation did not align with Squadron’s strategic goals, as we are already working to deliver 30 per cent of the renewable energy required to meet the federal government’s target of 82 per cent renewables by 2030, and want to bring new green electrons into the grid as soon as possible,” Dr Forrest said. “We have decided to focus on the existing 20GW pipeline of assets as a much faster way to achieve those goals and take Australia closer to a carbon-free future.”

Dr Forrest added: “As an interested shareholder we look forward to better understanding the details of the deal.”

Grok had already scored an early win during the administration, putting forward a successful proposal to provide Sun Cable with $65 million in interim funding while the sales process played out.

FTI was advised by Moelis during the sale process.

David Scaysbrook, the managing director of Quinbrook, said: “With construction well under way on the largest solar-plus-storage projects ever undertaken in the US and the UK, [the fund] is well positioned to assist Grok to complete the development of what promises to be not only one of the largest renewables projects in Australia, but a project of global significance.”

Moelis, alongside Macquarie, had already been working with Sun Cable to find its $30 billion project funding. It had raised $210 million in March 2022 to keep it rolling through 2023, but a high cash burn meant it was forced to consider raising more money, creating disagreement between Mr Cannon-Brookes and Dr Forrest about how to proceed. Others who had invested last year included MYOB founder Craig Winkler, NextDC chief executive Craig Scroggie and Beyond Zero Emissions boss Eytan Lenko.

FTI said that, based on the pre-administration claims that are outstanding, the transaction is expected to allow for unsecured creditors of Sun Cable to be paid in full. The completion of the transaction is subject to the satisfaction of customary conditions and administrative matters.

Source: Australian Financial Review

Key points:

• Mike Cannon-Brookes and Andrew Forrest initially partnered on the solar farm plan

• Mr Cannon-Brookes's Grok Ventures wants to send much of its power to Singapore

• Mr Forrest's Squadron Energy says it's "unconvinced" that plan is viable 

Billionaire Mike Cannon-Brookes has claimed control of the controversial Sun Cable solar export project, winning a bidding war after falling out with his former project partner, Andrew Forrest.

The pair, who are among Australia's richest men, have been in a closed door bidding process to wrest control of what's been promoted as "the world's largest solar energy infrastructure network". 

Andrew Forrest's entity Squadron Energy said it made an initial offer for the Northern Territory project, but then withdrew from the final bidding process. 

Sun Cable's administrators said the company had now entered into a sale agreement with a consortium connected to Mr Cannon-Brookes's Grok Ventures.

The consortium also includes infrastructure investor Quinbrook.

Under their control, the project will pursue its original goal of exporting solar power from the outback of Australia to the island nation of Singapore. 

Mr Forrest said his company was "unconvinced of the commercial viability" of sending the power to Asia.

But, in a statement, Mr Cannon-Brookes said the outcome was "a big step in the right direction":

"We've always believed in the possibilities Sun Cable presents in exporting our boundless sunshine, and what it could mean for Australia. It's time to stretch our country's ambition. We need to take big swings if we are going to be a renewable energy superpower. So swing we will."

A joint statement from Grok and Quinbrook said Sun Cable had "the potential to be a nation-building project for Australia, generating and transmitting critical clean energy to Singapore and [supplying] renewable energy to new Northern Territory industries".

Sun Cable was put up for sale earlier this year, after a split between the two men, who were its biggest backers when it required an initial investment of $30 billion. 

The men had different visions over what to do with the 20-gigawatts of power the solar farm was expected to generate in the middle of the outback.

On Friday, Mr Forrest congratulated Mr Cannon-Brookes, and issued a statement saying:

"While Squadron Energy did not participate in the final binding bid process for Sun Cable, we are delighted that other investors like Grok are playing a role in tackling global warming, by replacing fossil fuel investment with green energy projects.

"Squadron decided the capital allocation did not align with Squadron's strategic goals, as we are already working to deliver 30 per cent of the renewable energy required to meet the federal government's target of 82% renewables by 2030 and want to bring new green electrons into the grid as soon as possible."

Harnessing the sun to help power Singapore

Sun Cable was formed in 2018 by a team of people based in Singapore and Australia, including current chief executive David Griffin.

In 2019, it revealed a plan to transform Australia, one of the world's biggest miners, into an exporter of renewable energy.

Sun Cable wanted to build a solar farm in outback Northern Territory, which would be large enough to be seen from space, with much of the renewable power it generated to be sent to Singapore.

To do this, Sun Cable wanted to install a large battery network and run a 4,200 kilometre undersea transmission line from a spot near Darwin to the gas-dependent island nation.

Initially, Mr Cannon-Brookes and Mr Forrest appeared to be united on the project's goal to export solar power to Singapore. But the partnership fractured earlier this year.

In a statement early this month, the Energy Market Authority of Singapore (EMA) told ABC News it was in "discussions" with Sun Cable and couldn't discuss them as they were commercially sensitive.

"No agreement has been signed with Sun Cable," a spokesperson said. "And EMA has not made any financial contribution to the project."

Final environmental approvals for the solar farm also haven't been given, and traditional owners need to be consulted about the 12,000 hectares of panels to be erected.

Why did two of Australia's richest men fall out over Sun Cable?

Earlier this year, Mr Forrest's private investment arm Squadron indicated it no longer supported Sun Cable's goal to export solar to Singapore, and would prefer to use the energy it generated for local projects, such as making hydrogen.

Mr Forrest has been a vocal proponent of hydrogen, including for generating so-called green steel.

After the split emerged, Sun Cable was put into administration and up for sale.

As well as Mr Cannon-Brookes's Grok Ventures and Mr Forrest's Squadron, the ABC understands there were several other entities bidding for control of the project.

Final bids closed on May 23.

What does this mean for local supply of solar?

Much of the focus on Sun Cable to date has been on its plan to export power to Singapore to supply up to 15 per cent of the island nation's energy needs.

However, it also planned to supply a chunk of solar energy to the Northern Territory, provisionally reported as around 800 megawatts.

Critical minerals company Tivan signed a non-binding deal with Sun Cable earlier this year, while it was still in administration, to take some of its solar energy in Darwin.

Tivan wants to mine critical minerals in Australia and process some of them at a development precinct proposed by the NT Government at a site in Middle Arm.

Tivan's executive chair Grant Wilson said it hoped to take 200-300MW of solar energy from Sun Cable to power its proposed Middle Arm site.

"We're happy to work with either party," Mr Wilson said ahead of the announcement, but added the deal may need to be re-negotiated if there was a change of management or board structure.

Mr Wilson said if Friday's decision meant they could not access Sun Cable's solar power, they would seek to get renewable energy elsewhere to offset production, and even floated the idea of accessing electricity from beleaguered NT solar farms not yet connected to the grid.

"It's a decision for Sun Cable. We just want to see the project go ahead," he said.

"Because Sun Cable is such a mega project, they're able to offer the lowest price [for the solar] because of the economies of scale."

Source: ABC News