Industry News

AUSTRALIAN oil and gas explorer Empire Energy has selected the location for its first well in the frontier Beetaloo sub-basin, in the Northern Territory.

ASX-listed Empire Energy has selected a drilling contractor, picked its well site for Capentaria-1, ordered necessary equipment, and finalised the well design. 

The announcement today saw the company's shareprice jump more than 4% to 25.5 cents per share. 

It plans to spud the well in exploration permit EP187 in the third quarter, despite challenges posed by COVID-19 restrictions and a volatile market. 

Carpentaria-1 will be drilled to a depth of 2900 metres and target the Velkerri Shale and Kyalla Shale formations. While the Velkerri has already proven to hold dry gas elsewhere, the Kyalla which is the secondary target could hold liquids. 

The well aims to identify and prove up the thickness of the shales. 

Currently Empire believes its well will hit up to 600m of Velkerri shale and a 100m interval of the Kyalla shale. 

Once drilled, it will be fracced and tested. Data from the well will be used to design an appraisal program slated for next year, with a view for short-term production. 

It is expected the drilling, completion and evaluation of the well will take around 45 days. 

Over the last two or so years, Empire have pivoted away from US onshore exploration, to focus solely on Australian domestic opportunities. 

The company believes the Beetaloo basin will play a "key role in opening up Australian supply of domestic energy." 

"We are really excited to replicate the US shale boom here in Australia," managing director Alex Underwood told Energy News. 

Recently, independent oil and gas research firm Netherland, Sewell & Associates estimated Empire's entire portfolio, which spans 14 million acres, now holds a combined 13.46 trillion cubic feet of gas on a 2U best estimate basis. 

Within EP187 Netherland, Sewell & Associates, estimate a 2U prospective resource of 2.4 Tcf

Source: Energy News Bulletin

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Community and Business Reference Group meet for the seventh time

The Onshore Shale Gas Community and Business Reference Group (Reference Group) held its seventh meeting in Darwin on 2 June 2020.

Established to provide a forum for government to seek advice and share information, the Reference Group received updates on:

• progress of the Framework for Strategic Regional Environmental Baseline Assessments (SREBA); including the outcomes of public consultation on the draft Framework which were completed in early 2020, and plans to form a regional reference group for the development of the SREBA in the Beetaloo Sub-Basin
• draft Offsets policy related to the Environment Protection Act 2019, which was released for public comment at the end of 2019
• status of Environmental Management Plans (EMPs) currently under assessment by the Department of Environment and Natural Resources (DENR)
• development of the Gas Service and Supply Plan, including actions to grow the service and supply industry, and grow Territory research and innovation and training. The Plan is available online . 
• work underway for the Aboriginal Information Program to address recommendations 11.5 and 11.6

The Reference Group also discussed the ongoing mechanisms for oversight of Stage 3 of the Implementation Plan and noting the term of the CBRG was set to conclude on 30 June 2020, requested Government consider extending their term for a further 6 months till 31 December 2020.

The Reference Group noted that as at 30 April 2020, and as per the 6-monthly update, 60 of the 135 recommendations have been fully completed, 71 have commenced, and four are yet to commence.

For full details of the meeting and to read Communique 7 PDF (165.2 KB) . 

Office Hon. Dale Wakefiled

The Territory Labor Government’s target of 50% renewables by 2030 is delivering local jobs and cheap, clean power.

Following the installation of Titjikala’s new 400kW photovoltaic solar array, the community will now have its energy future transformed through a new 970kWh battery energy storage system (BESS).

Titjikala is the second remote community in the Territory where energy generation costs will be significantly reduced because of the Territory Labor Government’s investment in solar and battery technology.

The BESS will save approximately 156,000 litres of diesel annually. Not only will the diesel engines be turned off during daylight hours, but excess solar energy generated will be stored for overnight use. The engines will start up again overnight when the BESS is depleted.

The BESS will also have significant environmental benefits for the Titjikala community. There will be cleaner air through cleaner power, less traffic on the roads from heavy vehicle diesel delivery trucks, and reduced noise from diesel engines.

The Titjikala BESS project will cost an estimated $950,000. The investment is expected to be repaid from savings within five years and the project is expected to be completed by early 2021.

Titjikala’s solar array installation was part of the Solar Energy Transformation Program (SETuP), which is Australia’s largest rollout of solar power to remote communities.                                                                                                                    

SETuP was a $59 million program co-funded by the Territory Government and the Australian Renewable Energy Agency (ARENA). The program was rolled out to 25 sites across the Territory.

Quotes from Minister for Renewables, Energy & Essential Services, Dale Wakefield

“The Territory Labor Government is delivering more renewables because we know it means cheaper, cleaner power and more jobs.

“We are not just investing in our major centres, but we are also investing in our remote communities and ensuring that we are delivering cheaper and cleaner power for ALL Territorians.

“We have made significant progress towards our target of 50% by 2030 with renewables projected to reach 16% by the end of 2020 – up from 2% in 2016.

“These reforms and the significant progress we’ve made would be put at risk by a CLP or Terry Mills Government.

“With the CLP continuing to claim renewables are a hoax, and Terry Mills promising less renewables, only Labor has the record and policies to secure a renewable future for the Territory.”

Media Contact: Paige Nguyen 0428 727 244
paige.nguyen@nt.gov.au 

Natural gas will have an important role to play in a low emissions future and will be a key partner in Australia’s renewable energy supply chain. Already considered a ‘clean’ fuel, natural gas produces the least amount of carbon dioxide of all fossil fuels. However, what many people don’t realise is that natural gas will also have a prominent role in the development of Australia’s new hydrogen industry. 

Learn more.

APPEA recently released a report undertaken by energy research and consultancy Wood Mackenzie. The report highlighted that the industry’s success from 2009 to 2012 was predicated on relatively few regulatory and fiscal changes in the previous decade, which provided a strong foundation for a wave of unprecedented investment.

The scale of this investment, including the establishment of LNG projects in the Territory was worth approximately $350 billion Australia wide and has delivered direct and indirect economic benefits to the Australian economy.

In the immediate term, the benefit has come from direct spending into local communities while the full taxation benefits to be accrued in the latter half of this decade.

Wood Mackenzie Vice President Energy Consulting, Asia Pacific Chris Graham said: “Our analysis found the stability of the regulatory and fiscal environment in the years prior to investment was key to oil and gas majors with strong balance sheets and development capability making long-term commitments to the country.

“However, against the backdrop of a challenging macroeconomic environment and lower commodity prices, Australian fiscal and regulatory volatility has increased at a time when continued stability would be highly beneficial.”

While focused on the oil and gas industry, the findings also show regulatory instability, intervention and uncertainty, coupled with Australia being considered to be a high-cost destination for business, has reduced the investment appetite, is also relevant for many other industries in the Territory.

The Territory has an opportunity to secure a new wave investment in gas and stable regulatory and fiscal environment is crucial for recovery.  While the report was completed prior to understanding the full impacts of COVID-19, and the decline of the oil price, it remains relevant as Australia shifts focus to economic recovery and global reintegration.

A lack of investment will have economic flow-on effects to communities and businesses we work with, making it counter-productive to the economic recovery phase that this country will need to embark on.

A copy of the report can be found here. 

https://www.appea.com.au/wp-content/uploads/2020/05/Australia-Oil-and-Gas-Industry-Outlook-Report.pdf 

Updates on implementation of recommendations from the Final Report of the Scientific Inquiry into Hydraulic Fracturing are made available on the Hydraulic Fracturing website. This progress update provides detail on the status of implementation from 1 November 2019 to 30 April 2020. As at 30 April 2020, 60 of the 135 recommendations have been fully completed, 71 commenced and four are yet to commence. Updates to the implementation status of individual recommendations can be found by clicking on the relevant recommendations here   30 April 2020 implementation progress highlights include: 1. The Strategic Regional and Environmental Baseline Assessment (SREBA) From 9 December 2019 to 28 February 2020, the draft SREBA Framework was released for public consultation. The draft SREBA Framework PDF (3.1 MB)  and Guidance Notes explain the expected roles and responsibilities of parties involved, and the interconnection and design of the six study areas when undertaken anywhere in the NT, in the domains of: Water quality and quantity Aquatic ecosystems Terrestrial ecosystems Greenhouse gas emissions Environmental health Social, Cultural and Economic, inclusive of a Strategic Regional Assessment. The SREBA public consultation period received 16 written submissions, and verbal feedback during 12 in-person stakeholder briefings. The full SREBA framework is currently being finalised based on feedback received and is expected to be released in July 2020. Scopes of work for each SREBA domain are currently being drafted and require approval from the Minister for Environment and Natural Resources prior to finalisation. These will be submitted to the Minister individually as each scope of works has varying technical expert input and stakeholder engagement required to finalise. The opportunity to submit an application to tender for the Social, Cultural and Economic SREBA scope of work is available on the NT Government current opportunities  page. 2. Regulation and Assessment The NT Government has progressed a number of recommendations relating to regulation and assessment, including: Commenced drafting land access provisions within the draft Petroleum Regulations 2020, expected completion July 2020. Passed the Petroleum Legislation Miscellaneous Amendments Bill 2019, to commence in June 2020 alongside the Environment Protection Act 2019. The amendment to the Act completed five recommendations in full and has enabled the progression of another four recommendations. Written a submission to the Commonwealth Government’s review of the Environment Protection and Biodiversity Conservation Act (EPBC Act), which reiterates the NT Government’s commitment to implementing Recommendation 7.3, to amend the EPBC Act to apply the ‘water trigger’ to onshore shale gas development. 3. Aboriginal Information Program The Aboriginal Information Program (addressing recommendations 11.5 and 11.6) is being designed to ensure: Aboriginal people and communities have access to consistent, factual, relevant and easy to understand and culturally appropriate information relating to the onshore petroleum industry. CSIRO is developing an information package that can be used when engaging with communities who will potentially be affected by the gas industry. Stage one of this work will be delivered mid-2020, with testing, translation into Aboriginal languages and engagement to commence in the second half of 2020. Independent Oversight of the sixth Hydraulic Fracturing Implementation Progress update The role of the Independent Overseer is to provide the Chief Minister and NT Government with independent advice on how the implementation of the recommendations from the Inquiry is progressing and being managed. The nature of this role requires the Independent Officer to remain at arms-length from day-to-day decisions and processes relating to implementation. The Independent Overseer of the implementation of the recommendations, Dr David Ritchie, has provided comment on the progress of implementation outlined in the sixth quarterly update. Overall, Dr Ritchie found that implementation continues satisfactorily in accordance with the findings of the Inquiry. In his letter, Dr Ritchie noted the effects of the COVID-19 pandemic, and that travel restrictions may delay progress on some recommendations which require face-to-face engagement. Read Dr Ritchie’s full advice here PDF (218.7 KB)  To contact the Independent Officer, email Dr David Ritchie at independent.oversight@nt.gov.au  Community and Business Reference Group The Community and Business Reference Group met for the seventh time on 2 June 2020. The agenda included: Review of the 6 month Progress update Targeted engagement for Stage three of implementation What’s next? The NT Government is progressing from stage two to stage three of the Implementation Plan for most Hydraulic Fracturing Inquiry recommendations. Stage three recommendations are mostly larger projects that are anticipated to be delivered over the next 18 months to three years. Progress updates will be announced through six-monthly community bulletins as Stage 3 of the Implementation Plan continues. Want to find out more? To find out about opportunities to engage in consultation or to keep up to date with status of implementation of each recommendations, sign up for regular updates on the website: www.hydraulicfracturing.nt.gov.au  by email: hydraulic.fracturing@nt.gov.au

AUSTRALIAN onshore oil and gas explorer Central Petroleum has appointed a new, well-known, face to its board as it looks to future growth in the Northern Territory.

In a notice to shareholders today, ASX-listed junior Central Petroleum announced Dr Agu Kantsler had joined the board as a director.

Kantsler is a familiar face in the Asia-Pacific oil and gas industry, and is currently a non-executive director of Oil Search.

Prior to joining Oil Search, Kantsler led Woodside Petroleum as executive vice president for exploration and new ventures.

Central Petroleum said Kantsler's appointment was made after an "extensive search" for the right fit.

"Kantsler's appointment is timely as he joins Central during an important step-change in the evolution of our company," Central chairperson Wrix Gasteen said.

Gasteen said Central was emerging from market challenges posed by the COVID-19 pandemic and oil price crash, and that Kantsler would bring technical credibility and an "extensive depth of experience to the board" at an "exciting juncture" in the company's growth strategy. 

Central aims to become on of Australia's major suppliers of gas to the east coast market.

This year the company is looking to the Northern Territory's Amadeus Basin for exploration, while also completing its recently drilled Dukas exploration well.

"[Dukas] is targeting one of the largest conventional on-shore gas prospects in Australia," Gasteen noted.

Source: Energy News Bulletin

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AFTER enacting the onshore petroleum laws at the end of May the government of Timor-Leste has now approved its national oil company Timor Gap to take a 20% participating interest in any production sharing contracts awarded from its upcoming licensing round. 

The round began October last year and runs a year. It was launched at the nation's inaugural oil and gas conference held in Dili. Eleven offshore blocks and seven onshore are available.   

Timor Gap has also recently farmed into the former Joint Petroleum Development Authority permit PSC 11-106 and has also entered two onshore PSCs with Nepean Engineering subsidiary Timor Resources.  

It has a PSC with Singapore-based Sunda Gas, awarded in November and another with Inpex dated September.  

It holds a 56.56% stake in the Greater Sunrise gas project with operator Woodside Petroleum.  

Source: Energy News Bulletin

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The Intyalheme Centre for Future Energy will lead a project to increase renewable energy uptake through the development of microgrid technology.

Intyalheme, a flagship project of Desert Knowledge Australia (DKA), has been awarded $3.2m in grant funding from the Australian Government under the Regional and Remote Communities Reliability Fund – Microgrids.
 
The project will address barriers that are limiting additional renewable energy from being added to the Alice Springs power system.
 
Using technical, economic and behavioural modelling, the project seeks to determine which short-term interventions will be needed to shore up existing grid stability as a first priority.
 
Beyond that, the regulatory and technical developments needed to support a higher proportion of renewable energy will be identified. The modelling will outline how the Alice Springs grid could operate without any thermal (conventional) power generation, even for a short period.
 
Other factors will be explored, such as working out the implications of disconnecting and reconnecting a microgrid into the main power system, and establishing who carries the liabilities for supply during periods of disconnection.
 
“This funding forms part of a broader plan to revolutionise the Alice Springs power system over the next two years,” said General Manager of the Intyalheme Centre for Future Energy, Glenn Marshall.
 
“The transition to a renewable energy future is upon us, and because Alice Springs is an isolated grid, we will be among the first to face the sort of grid stability challenges that are associated with a high proportion of renewable energy,” he said.
 
“Technology like microgrids, household batteries, and cloud forecasting will be crucial in the future energy system, so today’s announcement is terrific news as it ensures a firm path towards a clean and secure energy future for Alice Springs.”  
 
Lessons learnt through the Alice Springs study will be applicable to other grids in the Northern Territory, and beyond.
 
The project will culminate in the development of a Roadmap to 2030 report, identifying the necessary steps to reach the NT renewable energy target of 50 per cent by 2030, in Alice Springs.

More information available here