Industry News

Onshore Shale Gas Community and Business Reference Group tenure extended by Chief Minister

The Onshore Shale Gas Community and Business Reference Group (Reference Group) met in Darwin last week to consider the suite of regulatory reforms and provide feedback on the overall progress to date of the implementation of recommendations from the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory.

Initially appointed for a period of 12 months, the Reference Group performs a vital role in providing a platform through which key stakeholders can communicate their views about the implementation framework and its subsequent execution directly to the Government.

Meeting four times a year, the 17 member Reference Group includes representatives from the community, environmental groups, local business, the gas industry, land councils and local government.

Acknowledging the important role the Reference Group plays in ensuring implementation plan progress aligns with community and industry expectations, the Chief Minister has extended the term of the Reference Group for a further 12 months, inviting all members to continue in their current capacity as a Member until June 2020. The next meeting will be held in August 2019.

A number of speakers gave presentations to the group, including:

• The Independent Officer overseeing implementation of the recommendations from the Scientific Inquiry into Hydraulic Fracturing, provided his assessment of the progress of the Implementation Plan, acknowledging the significant regulatory reform achieved to date, including transfer of regulatory responsibility under the Petroleum Act 1984 from the Minister of Primary Industry  and Resources to the Minister of the Environment and Natural Resources;
• Department of Primary Industry and Resources provided an update on the implementation of Recommendation 14.4, Declared Reserved blocks under the Petroleum Act 1984. The Consultation Paper: Proposed reserved blocks (no-go zones) for petroleum activities in the Northern Territory may be accessed here. Have your say on proposed no go zones here
• Department of Environment and Energy (Commonwealth Government) discussed the Commonwealth approach to environmental assessments under the Environment Protection and Biodiversity Conservation Act 1999 (the EPBC Act).

A communique from the meeting has been published and is available here

The chair of the CBRG can be contacted via email at Cbreference.group@nt.gov.au

A booklet, Preparing for Exploration: Changes to the Regulation of the Northern Territory’s Onshore Petroleum Industry is available here

Read Dr Ritchie’s letter to the Chief Minister on implementation progress here

For more information or to track implementation progress of the recommendations made by the Inquiry, visit www.hydraulicfracturing.nt.gov.au

DARWIN – ConocoPhillips Australia, as operator of Darwin LNG, today announced that it will invest in an innovative battery project projected to reduce the facility’s carbon emissions from power generation by 20 percent.

The battery will enable the existing turbines to run at maximum efficiency and remove the need to run an additional turbine, saving thousands of tonnes of fuel gas and reducing maintenance costs.

Darwin LNG will become the world’s first LNG plant to install a battery to reduce emissions, providing a template for other LNG facilities.

ConocoPhillips Australia West President Chris Wilson said the project continues Darwin LNG’s record of innovation and leadership in carbon management.

“The battery has significant potential to integrate with other opportunities currently being considered by Darwin LNG to increase energy efficiency and reduce emissions such as alternative energy generation,” Wilson said.

“DLNG has been an industry leader in environmental performance and carbon management for over a decade through its role establishing the West Arnhem Land Fire Abatement project (WALFA), pioneer of the savannah-burning offset industry now central to Australia’s emission reduction efforts.

“WALFA remains one of Australia’s largest offset projects and has been emulated by more than 80 other programs, offsetting more than 2 million tonnes of CO2e emissions whilst improving biodiversity outcomes, creating Indigenous jobs and protecting ancient cultural sites from intense wildfire.”

Wilson also noted that ConocoPhillips’ leadership on managing climate-related risks is highlighted by a global commitment to reduce greenhouse gas intensity of operations by 5 to15 percent by 2030.

The Darwin LNG Joint Venture comprises ConocoPhillips (56.9 percent and operator), Santos (11.5 percent), INPEX (11.4 percent), Eni (11.0 percent), JERA (6.1 percent) and Tokyo Gas (3.1 percent). 

READ FULL MEDIA RELEASE HERE

Contact Michael Marren +61477 739 478 Michael.A.Marren@conocophillips.com

Changes to the Regulation of the Northern Territory’s Onshore Gas Industry
 
The Northern Territory Government has implemented changes to the regulation of the onshore petroleum industry to protect the environment, ensure accountable industry practice and provide transparency and clarity in the decision making process. Download detailed information here

Key changes have been implemented in accordance with recommendations set out in the independent Scientific Inquiry into Hydraulic Fracturing in the Northern Territory (the Inquiry) and include;

• The Northern Territory Minister for Environment and Natural Resources is now responsible for the regulation of environmental management of the onshore petroleum industry
  
• Water use for onshore petroleum industry activities is now regulated through the Water Act 1992 with specific requirements for petroleum activities
  
• A legally enforceable Code of Practice clearly defines standards and requirements of petroleum industry operations
  
• Publication of draft Environment Management Plans (EMP) for public comment for the drilling of petroleum wells and hydraulic fracturing prior to consideration by the Minister.
  

New elements of the assessment of EMPs include:

• Publication of EMPs for drilling petroleum wells and hydraulic fracturing for public comment
  
• Alignment with the new Code of Practice
  
• Disclosure of hydraulic fracturing chemicals used, flowback fluid and produced water composition
  
• Baseline weed assessment and weed management plans in place
  
• Northern Territory Sacred Sites Act 1989 authority certificates for protection of sacred sites required before an EMP can be approved
  
• Baseline groundwater and methane monitoring to be completed before drilling and hydraulic fracturing can commence
  
• Mandatory assessment of potential cumulative effects.
  

There are also important changes to laws to increase the transparency around decision making, in addition to EMPs published for public comment, including that public comments will be taken into consideration by the Minister in her decision making. Public comments, and a statement of reasons will now be published on the Department of Environment and Natural Resources website, should an EMP be approved.

The Territory Labor Government will keep almost half of the Territory free from hydraulic fracturing exploration or production activities as part of its commitment to protect our natural environment and create jobs.   

Proposed No-Go Zones Consultation Paper 

As part of recommendations from the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory, areas exempt from petroleum activity, called no-go zones, will cover 48.44 per cent (654,900km2) of the Territory.

The Inquiry determined, through its research and consultation, there should be areas that are off limits to any petroleum exploration or production activities, due to these areas’ unique values and their important role in providing environmental, social, health and cultural benefits to surrounding communities.

In identifying these areas the Territory Government has taken into consideration a number of existing factors such as granted exploration permits, Aboriginal Land and current land use.

The Territory Government will consult with Traditional Owners through the relevant Land Councils to determine whether or not they would like to declare areas within Aboriginal Land as reserve blocks.

By consulting we are ensuring that these areas not only meet the recommendations of the Inquiry, but they also meet the expectations of Territorians. 

Territorians can now have their say on the proposed areas to be declared a reserved block via the website haveyoursay.nt.gov.au

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

“The Territory Government has a clear plan to protect our environment, create local jobs and ensure the actions of Government and industry are transparent and accountable.”

“Our Government respects the rights of Traditional Owners under the Aboriginal Land Rights Act to determine what activity occurs on their land.

“We are delivering stronger regulation and at the same time creating certainty for companies planning for onshore gas exploration this dry season.”

Media Contact: Cameron Angus 0404 021 192

Public consultation now open on No Go Zones for onshore gas

Territorians are invited to comment on which areas should be exempt from exploration or production activities related to onshore petroleum.

A reserved block, or No Go Zone, is land that is not able to be considered as part of a land release for exploration, and companies are not able to apply for an exploration permit or licences for these areas.
A consultation paper has been developed and expands on the commitments made by the NT Government to protect certain areas of the Territory from ever being subject to petroleum exploration or production activities as part of the recommendations from the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory.

This will be achieved by declaring areas of land as reserved blocks (no-go zones) under the Petroleum Act 1984. The areas identified include: areas of high tourism value; towns and residential areas (including areas that have assets of strategic importance to nearby residential areas); national parks; conservation reserves; areas of high ecological value; areas of cultural significance; Indigenous Protected Areas and areas that are not prospective for onshore gas.

In detailing these proposed reserved block areas the government has considered a number of other existing factors such as granted exploration permits that have potential reserved block areas within them and Aboriginal Land Rights (Northern Territory) Act 1976.

There will be some areas that can be declared reserved blocks very quickly, while other areas will take some time, and likely require negotiation with exploration permit holders.

Comments received from the public during the consultation will be considered by the Territory Government before it finalises reserved block areas where onshore petroleum activity will not occur in the Territory.
The Territory Government will consult with Traditional Owners through the relevant land councils to determine whether or not they would like to declare areas within Aboriginal Land as reserved blocks.

The Territory Government will negotiate with petroleum companies who hold granted exploration permits and have applications for exploration permits (that are not on ALRA land) to ensure the areas the Inquiry identified should be declared reserved blocks are removed from existing permits and not be considered during the permit application process.

The consultation paper is available to view online at Territory Government’s Have Your Say website https://haveyoursay.nt.gov.au/

Submissions can be made via the website or via email at info.dpir@nt.gov.au

Public submissions are open until 21 June 2019.

To read the latest from the NTG Newsroom, please visit NTG Newsroom

Read the Consultation Paper: Proposed reserve blocks (no-go zones) for petroleum activities in the Northern Territory here
Alternatively, you can provide feedback via the Have Your Say Portal here

IICA Technology Expo - Darwin on 12 June - Delivering a World-Class Engineering Exhibition                   

Exciting New Exhibitors coming to the region at this year Darwin IICA Technology Engineering Expo!!

A unique opportunity to see the newest and cutting-edge innovations in the Engineering industry and the ever changing Technology in the Instrumentation, Control & Automation industry.     

Meet and talk with over 40 World Leading Companies National, International & local Exhibitors, best in the industry!

• Happy Hour 5pm - 6pm - Plus Refreshments
• No Entry Fee to Register Plus Door Prizes! 

All welcome to attend - For more information and to register visit - www.iica.org.au 

Or  Email  me with your contact details or return Registration form at the bottom of website page

CONOCOPHILLIPS and Santos have awarded a major contract for a subsea production system contract for the Barossa gas field development to TechnipFMC Santos suggests this puts Barossa gas and condensate field ahead to be the leading candidate to backfill Darwin LNG.

The engineering procurement and construction contract "represents a commitment to long-lead items in advance of a final investment decision," Santos said.  

The contract includes the engineering, design and fabrication of wellheads, manifolds and control system as well as installation and commissioning assistance.  

"This is the first EPC contract to be awarded for Barossa and a big vote of confidence in its position as the leading project to backfill DLNG," Santos managing director and CEO Kevin Gallagher said.  

Gallagher said the joint venture is making good progress in the front-end engineering and design phase and is evaluating bids for the gas export pipeline.  

"We are also looking at technical proposals for the floating production storage and offloading facility from both MODEC and the Technip/Samsung Heavy Industries consortium." 

"An invitation to tender for the development drilling contract has also been released, further advancing the project to meet DLNG's backfill timetable."  

 "We continue to focus on strong cost discipline with all our selected contractors, developing the certainty of cost, schedule and execution planning required to compete in our global portfolio and support a final investment decision," ConocoPhillips Australia West president Chris Wilson said.  

Barossa would more than double Santos' northern Australian production should it go ahead. 

Source: Energy News Bulletin

Read more here.

IN an unexpected upset the Liberal-National coalition led by Prime Minister Scott Morrison has been delivered back into power with an estimated 77 seats at this point and the ability to form a majority government. 

What exactly this will mean for energy policy isn't clear given going into the election the incumbent party spent little time campaigning on climate and emissions targets. However Scott Morrison has already told radio shock jock Alan Jones the government's energy policy will remain on the same course. 

"We set out all our energy policies at the election, and that's what I'm going to do. It includes a continuation of coal fired power as part of the baseload power. It includes hydro. It includes gas," he said after Jones asked for a specific commitment to coal-fired power to reduce household energy prices.  

"There's no change to our policies there. What I took to the election is what I'm going to do," Morrison said.  

"The next term provides an opportunity for the industry to work with the government to deliver better results for households and businesses," Australian Energy Council CEO Sarah McNamara said. 

"We acknowledge and thank minister Angus Taylor for his work in the last term and we look forward to a continued relationship with the Morrison government for the benefit of all energy customers." 

Taylor has kept his seat of Hume in Victoria, but there have been questions as to whether he will retain his portfolio.  

Sarah Henderson, the Liberal who joined protests against Equinor's plans to drill a well in the Great Australian Bight, lost her ultra-marginal seat of Corangamite to Labor. 

Labor's ambitious emissions targets are no longer as the Coalition does not have a target.  

Whether the Liberals may the National Energy Guarantee is an open question.  

Labor's emissions target may have concerned business, but the loss of its policy to allow carbon credits offshore - so companies with emissions heavy projects in other nations can invest in cheaper projects there rather than Australia - may be a blow to some.  

Woodside Petroleum managing director Peter Coleman has suggested an Australia-only policy would be expensive as land could be scarce and compete with agricultural projects. 

With no emissions target in place from government businesses have been working to the Paris climate accord target of no more than 2C warming over pre-industrial levels.  

Labor's loss could also sink plans to spend $1.5 billion on a pipeline network to send gas from Queensland's Bowen and Galilee basins to market, and to develop the Beetaloo Basin in the Northern Territory, though resources minister Matt Canavan is especially gung ho on the development of Beetaloo.  

Australian Petroleum Production and Exploration Association CEO Andrew McConville has called for a climate policy now the election is over. 

 Source: Energy News Bulletin

Read more here.

FALCON Oil & Gas has raised £7 million (A$13 million) through a share placement of 50.5 million shares at £0.14 (26c) per share on the London Stock Exchange, which it will use to fund its share of further drilling and appraisal work in the Beetaloo Sub-basin in the Northern Territory.

The Ireland headquartered oiler has a 30% stake in the unconventional play which consists of three permits (EO76, EP98 and EP117) alongside Australia's Origin Energy which owns the remaining 70%.  

Falcon and Origin are expected to bring drilling the next well in its exploration campaign as early as next month.  

To date the joint venture has drilled four wells under the stage one work program, which resulted in the discovery of 6.6 trillion cubic feet of 2C gross contingent resources.  

A 57 day extended well test resulted in cumulative production of 63 million cubic feet of gas and flow rated of 0.8-1.2MMcf of gas per day.  

The focus will be on the liquids-rich Kyalla Formation and Velkerri Shale.  

Origin and Falcon have now agreed to evaluate the potential of the liquids-rich gas fairways in both the Kyalla and Velkerri shales as part of the stage two work program, and plan to drill a further four horizontal wells mid this year.  

Under the stage two work program two wells will also be fracced. A third stage work program is planned for 2020. 

The estimated gross capital expenditure for stage two and stage three is US$130 million. Under the terms of the Farm-out Agreement, Falcon Australia is carried for up to A$113 million (US$80 million) for the costs of Stage two and Stage three, equating to US$24 million net benefit to Falcon, with Falcon's net cash contribution estimated at US$15 million, before contingency.  

"Falcon is delighted with the proposed placing to conditionally raise £7 million. This placing will see the company being adequately funded through the next US$100 million of capital expenditure on the Beetaloo project," Falcon chief executive Phillip O'Quigley said.  

"Preparations continue for the recommencement of drilling of stage two in mid-2019, which will include the drilling and hydraulic fracture stimulation of two horizontal wells, and we look forward to updating the market in due course."  

Source: Energy News Bulletin

Read more here.

The Territory’s plan to be a world-class hub for gas production, manufacturing and services will be outlined in a series of sessions aimed at the oil and gas industry and investors on the East Coast.

Team NT Executive members Paul Tyrrell and Clare Martin will lead the pitch. Their role is to advocate the Territory’s investment, business and lifestyle prospects nationally and internationally and harness investment opportunities.

Mr Tyrrell, as former head of the Territory’s public service, and Ms Martin, former Territory Chief Minister, are credited with playing key roles in significant initiatives such as attracting the Ichthys Project onshore LNG facilities to Darwin.

The oil and gas industry is supported by the Territory Labor Government’s Budget 2019 which included $6.5 million to continue the $26 million Resourcing the Territory program to stimulate resource exploration and investment attraction.

 Among the points highlighted at the sessions will be:

• The Territory’s five-point plan to diversify and grow the Northern Territory gas industry, including creating a new gas demand centre in Darwin to develop a range of gas processing and manufacturing industries, research and cluster centres.
• Prospective onshore gas developments in the Territory and the significant opportunities for gas supply to East Coast industrial and residential customers. This comes after the first gas flowed from the Territory to East Coast gas markets via the Northern Gas Pipeline in January this year.
• The Territory’s record of successfully facilitating large-scale investment projects across a range of industries including oil and gas, mining and agribusiness. Examples of gas sector developments include the INPEX-operated Ichthys LNG Facility, the ConocoPhillips-operated Darwin LNG Facility, Jemena’s Northern Gas Pipeline and the Tanami Gas Pipeline.
• Darwin’s role as a strategically located LNG hub supplying Asian markets. The Territory is strategically positioned to secure gas from existing offshore gas reserves in the Timor Sea or from future onshore gas developments. 

The sessions will be held this week in Brisbane, Sydney and Melbourne. They are being held in cooperation with the AI Group, Manufacturing Australia, and Chemistry Australia.

 Quotes from the Minister for Trade and Major Projects, Michael Gunner

“Continuing to sell the Northern Territory as an attractive investment destination is a priority of the Territory Labor Government.

“The oil and gas industry plays an important role in growing our economy and creating jobs through further onshore and offshore investment.

“Team NT’s sessions are an important element of showcasing what the Territory has to offer and will help maximise opportunities for investment and job creation.”

 Media contact: Cameron Angus 0404 021 192.