Industry News

16 February 2022

Joint media release with Minister for Industry, Energy and Emissions Reduction the Hon Angus Taylor MP and Treasurer the Hon Josh Frydenberg MP

Tight global gas markets have reinforced the importance of continued investment in Australia’s gas resources to avoid the supply shortfalls and high prices being experienced internationally. 

The Australian Competition and Consumer Commission’s (ACCC) latest Gas Inquiry Interim Report found that while domestic gas contract prices rose slightly between March and August 2021, Australia avoided the up to 230 per cent price increases seen overseas in the Asian LNG spot market.

The ACCC notes that timely investment and advancement of gas basins and infrastructure is critical to avoid an earlier than previously forecast gas supply shortfall in the south. 

Southern states are likely to be reliant on gas from the north to avoid a shortfall on certain days later this year. This is predominately due to a reduction in forecast production in the Gippsland and Cooper Basins. 

Consistent with the Government’s 2021 National Gas Infrastructure Plan, the ACCC notes that over the long term the development of basins such as the Beetaloo (NT), North Bowen (QLD), Galilee (QLD) and Gunnedah (Narrabri, NSW) would help to alleviate the shortfall. 

The report also notes that although low emissions alternatives may assist supply in the medium to longer term, technologies like hydrogen will not assist any sooner than 2030. 

Treasurer Josh Frydenberg said the ACCC acknowledged the Government’s measures to bring forward new domestic supply and to protect Australian households and businesses from the kinds of price and supply issues being experienced in other countries.

“The ongoing supply of affordable gas is crucial to helping Australia’s economy as it rebounds from the impact of the COVID pandemic,” Treasurer Frydenberg said.

Minister for Industry, Energy and Emissions Reduction Angus Taylor said domestic gas contract prices remained internationally competitive at around $6.70–$9.60 a gigajoule, while Asian LNG spot prices increased steeply over the reporting period.

“Australia has been fortunate to escape the devastating price impacts seen in Europe due to their energy crisis. Accelerating the gas-fired recovery is essential to ensure this does not happen here,” Minister Taylor said. 

“While the report notes some positive signs for infrastructure investment in expanding south-bound capacity, the Government will continue to assist industry where needed through our Future Gas Infrastructure Investment Framework.

“It is clear from the ACCC that underinvestment in the gas sector cannot continue. 

“This report is a stark warning that we cannot allow activism to slow gas projects. Without unlocking gas, we will feel the price pressures being experienced overseas.

“A Labor-Green partnership is a real threat to future gas supplies and gas prices.”

The ACCC also notes that Government-led initiatives such as the Energy Ministers’ pipeline reforms, and the voluntary Code of Conduct will help to constrain market power, improve price transparency and provide benefits for gas users. 

Minister for Resources and Water Keith Pitt said the interim report highlighted the need to further develop Australia’s vast gas resources, with the ACCC flagging a tightening east coast domestic supply-demand balance in 2022. 

“The Government recognises the importance of regularly looking for new opportunities to improve gas supply in the east coast market,” Minister Pitt said.

“This Government understands the importance of opening gas developments in Australia. We have committed to release new Strategic Basin Plans to unlock supply. Plans for the Beetaloo Basin and the Galilee and North Bowen basins have been released, and we are working on the Cooper and Adavale Basins’ Plan.

“The ACCC notes the uncertain supply outlook emphasises the importance of the Heads of Agreement signed with major producers, which continues to ensure competitive gas supply into the domestic market. The ACCC will continue to closely monitor LNG producer compliance with the Heads of Agreement.”

“I also fully endorse the ACCC’s strong encouragement of state governments to not adopt blanket moratoria or bans on gas development – these reckless bans cannot come at the cost of our energy security.

“It should be a concern to all Australians that this is exactly what The Greens have proposed in a Bill put before Parliament as part of their deal to support Labor if they hold the balance of power in a hung parliament.”

The ACCC report is focussed on the east coast gas market and is available on the ACCC website.

Media contacts:

Minister Taylor's office 02 6277 7120

Minister Pitt's office 02 6277 7180

Following the release of their social and economic impact assessment (led by ACIL Allen) in September 2021 which shared an independent report forecasting a bright decade ahead for the Northern Territory.  INPEX shares their mid-term strategy 'INPEX Vision @ 2022', outlining their plans in the Northern Territory for gas expansion and an additional LNG train by 2030 along with milestones for investment in carbon, capture and storage, renewable energy, and hydrogen.

To view their full strategy follow the link below:

https://www.inpex.co.jp/english/company/pdf/inpex_vision_2022.pdf

CENTRAL Petroleum is farming down three Amadeus Basin permits to the private Peak Helium, which will free carry the former for two sub-salt helium exploration wells.

Santos retains its existing share of all the permits. 

It marks a return to onshore helium exploration for Santos, which remains operator, whose Bayu Undan field that sends gas to the Darwin LNG plant is set to close in 2023. It is Australia's only commercial source of helium. 

Australia's sub-salt basins have always been seen as prospective for helium and more recently native hydrogen, given the thick seals trap the tiny molecules in a way other formations do not. 

One will target the 2014 hydrogen find at Mt Kitty by Santos, which never flowed commercial rates of the gas but was considered one of Australia's first native hydrogen finds. Mt Kitty also recorded a 9% helium concentration. Anything over 2% is considered extremely high. 

Bayu Undan, conversely, is only 0.1% but its LNG-sized scale makes it commercial. 

"The exploration program will also target naturally occurring or "gold" hydrogen which makes up a relatively high 11.5% of the gas found at Mt Kitty-1," Central said today. 

Gold is the newest colour added to the expanding hydrogen rainbow. Green is made with water and renewable energy, blue with natural gas and carbon capture and storage for the resulting CO2. Pink is made using nuclear power and water. Grey, black and brown all use hydrocarbons with no solution for the CO2 except to allow it into the atmosphere. 

Gold, or native hydrogen, is relatively new but geologists are now working overtime to identify sources. The first discovery was in Mali some years ago. The barrier to hydrogen is the same as helium: the natural gas that makes up the majority of the resource must also have a way to be commercialised. 

The other well will be at the Magee of Mahler prospect. Central also plans to move back its long-shuttered Dukas well, which has been chasing a helium resource in the same area since 2018 before mechanical issues led to a permanent shut in around 2019.

Central will farm down 31% of EP82, excluding the Dingo Satellite area, leaving it with 29%. It will also farm down 10% of EP112, dropping from 45% to 35% and 6% of EP125, with its interest to drop from 30% to 24% Mt Kitty is in EP125. 

Free carry costs will be capped at $20 million per well, with an effective date of October 1 2021, for two wells both targeting natural gas, helium and hydrogen in the sub-salt structures of the basin. 

"Santos has confirmed that it has entered into farmout arrangements with Peak covering their interests in EP82, EP112 and EP125, as well as their interests in EP105, EP(A)111 and EP(A)124," Central said today. 

"Central also has interests in the latter three blocks but these are not included in Central's farmout to Peak. There will be no change in Santos' role as operator under the farmout arrangements."

Drilling begins next year. 

"The investment by Peak sets a benchmark for the value of this acreage and demonstrates the potential of our sub-salt prospects for natural gas, high value helium and "gold" hydrogen," Central CEO Leon Devaney said today.

Source: Energy News Bulletin

Central Petroleum has entered into a farmout agreement with Peak Helium for various interests within the southern Amadeus Basin. 

Under the farmout, Peak will fund Central to drill two new sub-salt exploration wells: one at Mt Kitty and the other at either Magee or the nearby Mahler prospect. 

Combined with the planned Dukas exploration well, a total of three sub-alt exploration wells will now be prioritised for drilling in the Amadeus Basin. 

Central chief executive and managing director Leon Devaney said that the agreement for Peak was a “great catalyst” for a major near-term exploration drilling campaign. 

“We have clear joint venture alignment and full funding for the Mt Kitty and Magee/Mahler sub-salt exploration wells based n current drilling cost estimates,” said Devaney.

“We welcome Peak as a new joint venture partner, with this transaction marking a major step forward for further exploration in the southern Amadeus Basin.” 

Devaney added that the investment by Peak sets a benchmark for the value of the acreage, demonstrating the potential sub-salt prospects for natural gas, helium and hydrogen. 

Previous drilling in all three prospects has confirmed the presence of helium, hydrogen, and gaseous hydrocarbons.

Peak will earn a partial transfer of Central’s interests in the three permits. As such, the company will acquire 31 per cent in EP82, 10 per cent in EP112, and 6 per cent in EP125. 

Santos, operator of the three permits, has also entered farmout agreements with Peak, whereby the latter will acquire 20 per cent of Santos’ interests in EP82, 25 per cent in EP112, and 50 per cent in EP125. 

Santos will continue as operator in all three permits, and drilling is scheduled to commence in 2023.

Source: Oil & Gas Today 

8 February 2022

The Territory town of Jabiru has been powered by 100 per cent solar for the first time.

The milestone follows the completion of construction and as part of the final commissioning of the new Jabiru Hybrid Renewable Power Station this week.

The new hybrid power station will secure reliable and affordable electricity for Jabiru residents and businesses.

It will also provide Jabiru with at least 50 per cent renewable energy over the long-term using a hybrid model of solar generation, battery and diesel power, and its operation will see the equivalent of 1600 cars being removed off the road each year.

This model meets the Territory Labor Government’s target of 50 per cent renewable energy by 2030.

The project is part of the Territory Labor Government’s $135.5 million dollar commitment to the Future of Jabiru and Kakadu package, and is the first project to be completed as part of the transition to a tourism and services hub.

The renewable hybrid project was constructed and is being operated by Energy Developments Pty Ltd (EDL), a global leader in remote renewables.

Construction of the Jabiru Hybrid Renewable Power Station created around 300 jobs for local Territorians, including the Djurrubu Rangers who were employed to assist with land clearing, and cultural and environmental management.

Territorians have also been employed as part of the operational phase.

Quotes from Chief Minister Michael Gunner:

“Jabiru is an iconic Territory town – the gateway to Kakadu National Park and the West Arnhem Region. 

“We are investing millions into Jabiru to transform it into the tourism and services hub we know it is well positioned to be.

“This new Power Station has helped create more jobs for locals, and it is paving the way for better and more reliable services for Territorians and businesses in Jabiru.

 

Quotes from Minister for Renewables and Energy Eva Lawler: 

“Today’s announcement follows the successful transition of Jabiru residents’ power over to the new Power Station.

“Territorians deserve access to the very best services, no matter where they live, and we welcome this important step in beginning to transfer power to the new station. We are investing millions into Jabiru to transform it into the tourism and services hub we know it will one day be, and we need the infrastructure to get it there.

“The Territory Labor Government has set a 50 per cent renewable energy target by 2030, and we are on track to meeting this.”

Quotes from EDL Chief Executive Officer James Harman:

“It has been a privilege to work with the Northern Territory Government and key local stakeholders to deliver this transformative project for Jabiru’s future.

“The Jabiru Hybrid Renewable Power Station is now providing the town with stable, reliable energy that is at least 50% renewable over the long term, enabling the community to realise their vision of being an ecologically sustainable tourism and cultural hub for the region.”

Source: NT Government Newsroom

6 February 2022

The Territory Government is undertaking detailed investigative work into the baseline data of the Beetaloo Sub-Basin.

This week the Territory Government has released a tender for Environmental Health studies under the Strategic Regional Environmental and Baseline Assessment (SREBA) program in the Beetaloo Sub-basin.

There are four individual projects to be completed under this section of work, including:

• Population health - to set a baseline of the current health status of the population in the region;
• Air quality – to establish a baseline of air quality at selected sites in the region and develop a methodology for a monitoring program;
• Soils – a review and gap analysis of the studies undertaken through the Geological and Environmental Baseline Assessment program and Gas Industry Social and Environment Research Alliance program, the Department of Environment, Parks and Water Security (DEPWS) data holdings and any other relevant work, to establish a soil health baseline and develop a monitoring program.
• Water quality – a review and gap analysis of the water quality studies undertaken through the GBA program, GISERA and the Strategic Regional Environmental and Baseline Assessment (SREBA) program Water Quality and Quantity studies

Environmental Health is one of the six study domains within the SREBA Framework that must be undertaken prior to the granting of any onshore petroleum production approvals, as per Recommendation 15.1 of the Scientific Inquiry into Hydraulic Fracturing.

The scoping study for the social, cultural and economic studies was recently completed and forms the SCE scope of works.

Consultations undertaken in this stage included more than 40 organisations participating in discussions. The next stages of the SCE study will incorporate on-country engagement.

Undertaking the SREBA is one of 135 recommendations from the final report of the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory the Government has committed to completing.

To view the report visit https://hydraulicfracturing.nt.gov.au/sreba/study-domains/social,-cultural-and-economic and tender visit  https://tendersonline.nt.gov.au/

Quotes from the Minister for Environment, Eva Lawler:

“The Territory Labor Government understands that a strong economy relies on a healthy environment and our unique environment needs a specific Territory approach.

“The release of the SREBA environmental health studies tender is a positive step forward in completing our SREBA. Territorians entrust this Government to fulfil their social obligations before allowing onshore processing. 

“The release of the SCE scope of works sets out the design and requirements for collecting the social, cultural and economic baseline data, and the release of the SREBA environmental health studies tender is a positive step forward in completing our SREBA.”

Eva Lawler

Minister for Environment

NTG Newsroom

The Australian Petroleum Production and Exploration Association (APPEA) has lodged a federal budget submission with recommendations for initiatives the government could implement to build a more resilient economy through energy security. 

APPEA  shares the key elements of their 2022-33 Federal Budget Submission which was submitted to Treasury in late January.

APPEA are urging the Federal Government to use the 2022-33 Budget to encourage continued investment in secure, cleaner energy.

APPEA is calling on the government to consider reform opportunities that encourage continued investment in Australia’s oil and gas industry, ensuring energy supply and enabling a net zero future. These reforms reflect the priorities of our members and outlined in the attached one-page summary, will:

• Attract investment for sustained job creation and economic security,
• Support a decarbonised economy and net zero 2050,
• Deliver increased energy supply and security, and
• Protect and preserve Australia’s environment while maximising benefits to the Australian economy.

The submission calls for economy-wide investment allowances for large projects and new technology initiatives cutting carbon emissions; the immediate deductibility of wages and salaries; and the removal of barriers to oil and gas project restructuring among other recommendations.

A copy of their one-page Federal Budget submission summary, can be found here

The full submission can be accessed at this link.

Should you have any questions or need more information, please contact:

Simon Staples

Director - Commercial

0403 152 157 

sstaples@appea.com.au

28 January 2022

The Territory Labor Government continues to strengthen its COVID-19 response and has today announced that the existing mandatory vaccination policy for workers in public facing roles will be extended to include the booster vaccination.  

To reduce the spread of COVID-19 and serious illness during the current outbreak, the new CHO Direction outlines two deadlines for workers to receive their booster vaccination.

The first deadline is Friday 11 March, and this applies to workers in the following designated high-risk workplaces:

• Hospitals and healthcare facilities;
• Residential aged care facilities;
• Disability residential facilities;
• Correctional and detention facilities; and
• Renal hostels, family violence shelters, homeless shelters and sobering up shelters.

The second deadline is Friday 22 April, and this applies to the remainder of Territory workers who are required to be fully vaccinated.

As a reminder, you are required to be fully vaccinated if in the course of your work:

• You come into contact with vulnerable people;
• Your workplace poses a high risk of infection; or
• You perform work that is necessary for the operation or maintenance of essential infrastructure or logistics in the Territory.

To be eligible to work in the Territory, all workers covered by the above direction had to have received two vaccination doses by 24 December 2021. The 22 April deadline for the booster ensures everyone will become eligible for the booster before this deadline.

Booster vaccinations are available from NT Vaccination Centres, Aboriginal Health Clinics, Respiratory Clinics and participating GP Clinics and pharmacies.

For more information, and to book your vaccination, please visit: https://coronavirus.nt.gov.au/stay-safe/booking-your-covid-19-vaccine.

Quotes from Chief Minister Michael Gunner:

“We knew the Omicron wave would spread quickly and aggressively. We also knew that fully vaccinated Territorians would be the best protected – and they are. That is why we worked so hard to achieve such a high vaccination rate across the Territory.

“Two doses of the vaccine has given tens of thousands of Territorians excellent protection against severe illness – the booster shot makes sure that protection is stronger, and lasts longer.

“If you are eligible now, please don’t wait. Book in, boost up and give yourself and your loved ones the best shot at protection from serious illness.” 

Source: Northern Territory Government Newsroom

Michael Gunner
Chief Minister of the Northern Territory

Falcon Oil & Gas Ltd. (TSXV: FO, AIM: FOG) is pleased to provide details of the Stage 3 work programme in the Beetaloo Sub-Basin, Northern Territory, Australia with its joint venture partner, Origin Energy B2 Pty Ltd., a wholly owned subsidiary of Origin Energy 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 -> Stage 3

ASX-listed Hexagon Energy Materials has executed a memorandum of understanding with solar player FRV Australia to collaborate on a potential clean hydrogen hub at Middle Arm in the Northern Territory.

Middle Arm is some 30 kilometres southeast from Darwin near an inland waterway just past the port of Darwin. The Port of Darwin officially oversees the Middle Arm Sustainable Development Precinct. 

The MoU is non-binding; the proposed Middle Arm development is described by Hexagon as "a new potential North Western Australian hydrogen hub development". 

Hexagon notes that it collaborated with FRV in November last year within a consortium as part of an AusIndustry grant application; that application targeted a feasibility study for the h2 hub. 

Both companies are already developing respective hydrogen economy projects within the NT. Hexagon is close to completing a pre-feasibility study on the NT-based hydrogen-focussed Pedirka Project; scheduled for completion by late February. 

That study is analysing the viability of an ammonia production "through hydrocarbon-based hydrogen production with CCS" project. 

Hexagon notes its MoU with FRV "could provide Hexagon access to FRV Australia's mix of renewable energy products to supply the power required for Hexagon's proposed clean Ammonia production plant". 

A renewables-based power source would ultimately reduce carbon emissions on paper, Hexagon notes this would "[require] less CCS". 

FRV manages nine solar farms in Australia; it sells a combined 781MW of electricity into the National Electricity Market. 

"This MoU with FRV Australia is one of many important opportunities and collaborations, both in the NT and other locations, that will help to realise our objective in establishing the most practical pathway for Hexagon to achieve large scale, long term, commercial, clean hydrogen production," Hexagon managing director Merrill Gray said. 

Hexagon shares are down 1.4% to 7cps.

Source: https://www.energynewsbulletin.net/