Industry News

Release of the first Hydraulic Fracturing Implementation Progress Report and Onshore Shale Gas Community and Business Reference Group update

The Community and Business Reference Group (Reference Group) held its second meeting in Darwin on 23 October 2018 to discuss the progress of implementing the recommendations from the the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory, and to provide input into the approach for delivering the framework for the Strategic Regional Environmental Baseline Assessments (SREBAs).

Representatives from CSIRO and the Northern Territory Government gave a presentation relating to the approach to define framework for the SREBAs and the Reference Group participated in these discussions and provided feedback, noting that Reference Group member Tom Stockwell is the Reference Group representative on the SREBA Project Advisory Committee.

The Reference Group also considered the quarterly progress report outlining the status of implementing the recommendations as set out in the Implementation Plan. In developing the Implementation Plan each recommendation was grouped into one of six reform areas and grouped into three delivery timeframes:

 Stage One – Planning, completed at the end of July 2018;

 Stage Two – Preparing for exploration, with a target completion date of December 2018; and

 Stage Three – Exploration and Preparing for Production, with a target completion of December 2021

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THERE is a multibillion dollar potential in hydrogen exports to North Asia and Australia is well placed to take advantage of the demand, according to Australia’s chief scientist, Dr Alan Finkel, who spoke to Energy News on the sidelines of the Gas Technology Conference-14.

Gas know how will come in especially handy for future hydrogen exports, though LNG trains cannot be reconfigured to process the far colder hydrogen and shouldn't need to be given rising global LNG demand, he said.  

"The Japanese as part of their national strategy are looking at 10MMtpa per year 2020-2040 (at) US$2/kg," he said.  

"That's $20 billion per annum.  

"There is potential for South Korea to be an importer, we're talking a substantial industry here. We could be the major supplier to Japan. It's a non-trivial market." 

There is also domestic potential via pipe gas, and industrial uses, though hydrogen as an energy source in and of itself is unlikely.  

Australia isn't the only nation Japan is looking to; it is trialling varied technologies in Qatar, Norway, Saudi Arabia, Brunei and Chile but Australia's proximity and export history help. 

The LNG boom that began in 1979 with the first contract signed and in 1989 with the first shipment from the North West Shelf consortium could be replicated for hydrogen with more haste, he said.  

Eventually there will be the same sorts of contracts, company to company, supported by bilateral agreements, spot markets and a trading hub, Finkel said all similar to the rapidly evolving LNG market.  

There are multiple technical challenges with hydrogen compared with gas, and though the decades of Australian know how helps there are large differences in that the liquefaction temperature is far lower, over -250C compared with -160C, it cannot be compressed in the same way as gas at scale, and it is not a recoverable resource, but must be created, however "the logic is the same", Finkel said.

Source: Energy News Bulletin

Read more here.

Perth, Australia – INPEX CORPORATION (INPEX) today confirmed the first shipment of liquefied natural gas (LNG) has departed from the INPEX-operated Ichthys LNG Project at its onshore gas liquefaction plant in Darwin, Northern Territory.

The first LNG shipment is destined for the INPEX-operated Naoetsu LNG terminal in Niigata Prefecture in Japan.

“First cargo from Ichthys LNG is a historic moment for INPEX, Japan and Australia. It demonstrates our commitment to being a safe, reliable long-term energy supplier,” said INPEX President Director Australia, Seiya Ito.

“Ichthys is an iconic project for Australia. With an operating life of around 40 years, Ichthys LNG will be delivering benefits to the Australian economy and community for decades to come.”

Ichthys is scheduled to gradually increase its production volume of LNG to approximately 8.9 million tonnes of LNG per year when it reaches its production plateau – this is equivalent to more than 10 per cent of Japan’s annual LNG import volume.

Approximately 70 per cent of the LNG produced by Ichthys LNG is scheduled to be supplied to Japanese customers, further contributing to the stable supply of energy to Japan and helping to meet energy demand in Asia and the rest of the world.

The departure of the LNG cargo follows the Project’s shipment of field condensate (ultra-light crude oil), which commenced on 1 October 2018, as announced on the same day.

The Project is also scheduled to commence the shipment of liquefied petroleum gas (LPG) later this year.

INPEX will continue to work toward achieving stable production and an early ramp-up at the Ichthys LNG Project with the understanding and cooperation of all its stakeholders, including Ichthys Joint Venture participants, the local communities, the Australian federal government and the governments of Western Australia and the Northern Territory.

Read more here

Onshore Shale Gas Community and Business Reference Group update

The Onshore Shale Gas Community and Business Reference Group provides direct feedback and advice to the Hydraulic Fracturing Inquiry Implementation Taskforce in the Department of The Chief Minister. The Reference Group is essential to ensure stakeholders have oversight and input into the development of the implementation framework and its subsequent execution.

The Community and Business Reference Group will meet on Tuesday 23 October. The Agenda can be viewed here

The second meeting of the Reference Group will focus on the design of the Strategic Regional and Environmental Baseline Assessments and the planned changes to the Regulatory Model to make the Minster for the Environment and Natural Resources the responsible Minister for decisions relating to the Petroleum (Environment) Regulations under the Petroleum Act.

Community and Business Reference Group members bring a diversity of skills from the community, environmental groups, local business, the gas industry and local Government. The Members are:

• Mr Denys Stedman (Chair) – Buy Local Advocate

• Mr Tom Stockwell – former President, Northern Territory Cattlemen's Association

• Mr Bobby Nunggumajbarr – Chairman, Yugul Mangi Development Aboriginal Corporation

• Mrs Katherine Warby – Barkly Pastoralist and Business Owner

• Mr Jimmy Cocking – Director, Arid Lands Environment Centre

• Mr Matt Doman – Director, SA and NT, Australian Petroleum Production and Exploration Association

• Ms Julie-Ann Stoll – Manager, Mining Central Land Council

• Mr Greg Bicknell – Chief Executive Officer, Chamber of Commerce

• Ms Gillian Duggin – Principal Lawyer and Executive Officer, Environmental Defenders Office

• Mr Geoff Crowhurst – Chair, Katherine Mining Services Association

• Mayor Fay Miller – Mayor, Katherine Town Council

• Prof Alan Cass – Director, Menzies School of Health Research

• Mr Michael Bridge – Chairman, Tourism NT

• Mr Joe Morrison – Chief Executive Officer, Northern Land Council

• Mr Greg Owens – Chief Executive Officer, NT Farmers

• Mr David Ciaravolo – Executive Officer, Amateur Fisherman’s Association of the NT

• Mr Damian Hale – Organiser, Australian Workers Union

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The government has announced electricity market reforms to deliver lower cost and reliable power, and meet the government’s target of its 50 percent renewables by 2030.

These reforms include a competitive wholesale electricity market consistent with recommendations made by the independent panel in the Roadmap to Renewables report.

Over the next 12 months, a Northern Territory Electricity Market (NTEM), tailored to the Territory’s circumstances, will be developed. 

This will ensure the growing interest in renewable energy can be facilitated in the Darwin-Katherine power network in a way which will deliver lower cost generation and reliable power to Territorians.

The NTEM is expected to be up and running within 12 months, and government will work closely with stakeholders on design and implementation.

Government will also begin consultation shortly on a review of supply and feed-in tariffs to encourage behind the meter energy storage for those with rooftop solar photovoltaics (PV) and stimulate greater take-up of energy efficient technologies.

This was also one of the recommendations made by the renewables panel to increase system reliability and enable Territorians to reduce their electricity costs during the most expensive times of the day. 

The reforms aim to encourage cheaper renewables into the system, putting downward pressure on power prices.

In a major step towards reaching the 50 percent renewables target, the government has approved a 25 megawatt (MW) solar photovoltaic electricity plant to be developed near Katherine.

The power purchase agreement (PPA) between Jacana Energy and Katherine Solar Pty Ltd will enable the construction of the $40 million project, create over 100 jobs during construction and be the largest renewable energy generator in the Northern Territory.

This is the first of a number of large-scale solar projects proposed by investors.

More information can be found at: https://roadmaptorenewables.nt.gov.au/

Quotes from the Chief Minister:

“Creating local jobs is my number one priority.”

“Our election commitment of 50% renewables by 2030 is already paying dividends by creating local jobs in the growing renewable energy sector.

“We have kept our promise to stabilise power prices after massive hikes under the CLP.

“The fact we have also kept public assets in public ownership means we are perfectly place to transition to more renewable energy while maintaining system reliability.

Quotes from the Minister for Renewables and Essential Services:

“This agreement between Katherine Solar and Jacana will increase renewable energy use in the Territory by between 3 and 4%.

“It’s a huge step towards our renewable energy target and will put downward pressure on electricity prices.

“There are lessons learned from the National Energy Market which we have incorporated into the design of this policy.

“This is a common-sense and best practice approach tailored for the Territory’s unique circumstances.”

Quotes from Martin Poole, Epuron Executive Director:

“Epuron is pleased to be entering into an agreement to sell solar electricity to Jacana. We look forward to the Katherine solar project moving into construction in the coming months."

“The NT has great potential for solar energy, and it is exciting to see the Territory Government’s initiatives to enable investors to compete to generate the lowest cost solar power for the grid."

“Epuron owns and operates solar power stations in the NT at Alice Springs, Yulara, Kalkarindji, Ti Tree and Lake Nash / Alpurrurulam and we are pleased to be here at the announcement of our first project in the Darwin - Katherine electricity system.”

Media Contact:  Cameron Angus – 0404 021 192

Implementation Plan (pdf 4 mb)

 

Japanese Prime Minister Shinzo Abe will make an historic visit to Darwin in November this year.

The visit, to be hosted by Australian Prime Minister Scott Morrison and Northern Territory Chief Minister Michael Gunner, is ahead of an APEC meeting of regional leaders in Port Moresby.

Mr Abe is expected to visit the Darwin cenotaph to pay official respects to Australian and Japanese soldiers and civilians killed during the bombing, and to inspect the $34 billion INPEX gas pipeline project, ahead of the first shipment of gas.

This is the first visit to Darwin by a Japanese leader since World War Two, when Japanese forces killed more than 250 people.  

Quotes from Chief Minister Michael Gunner

"The NT - Japan relationship is based on more than business, it is based on friendship, respect and a profound shared history. 

"We are great business partners, but first and foremost we are great friends - and I want to Japan to know it has no better friends in Australia than the people of the Northern Territory.

“This is an incredibly important visit from one of our most significant regional neighbours.  It highlights the importance of Australia’s relationship with Japan, and the strategic importance of the Territory. 

“Darwin is home to Japan’s single biggest investment outside of Japan, INPEX, and there are at least 40 years of identified future investment in the Territory through that project. 

“Through our engagement with the Japanese to date, we have also identified job-creating opportunities in agribusiness, telecommunications and data.  My next scheduled visit to Japan is in November, the week prior to Mr Abe’s visit to Darwin.   

“It is vital Australia looks to the North, and develops stronger relationships through trade, defence and investment.   

“The Territory is uniquely positioned to take advantage of growth in the Asian region, and we warmly welcome this historic visit by Mr Abe.”

 Media contact:  Cameron Angus - 0404 021 192

 

Leading energy-infrastructure company, Jemena, has today signed a new gas transportation contract with Santos to ship around 8 terajoules (TJs) of gas per day across the $800 million Northern Gas Pipeline (NGP).

Gas transported as part of the agreement will be used to provide energy for local mining and mineral processing operations in the Mount Isa region.

The new agreement means around 80 per cent of the NGP’s total available capacity in year one of operations has now been contracted.

Jemena’s Executive General Manager of Corporate Development, Antoon Boey, said the new contract reinforces the important role the NGP will play in supporting jobs and communities in regional Australia.

“Today’s announcement proves strategic investment decisions like the Northern Gas Pipeline can help to mitigate forecast gas shortages while bolstering local industry and strengthening the Northern Territory’s growing gas credentials,” said Mr Boey.

The agreement comes after Jemena announced it had signed a contract with Incitec Pivot Limited (IPL) to deliver 32TJs of gas per day to IPL’s Gibson Island facility in Queensland. This facility employs around 400 staff during normal operations and up to 800 staff during peak periods.  

Mr Boey said the new agreement will see Jemena transport gas for three years from the first day of commercial pipeline operations for Santos.

“This agreement provides more much-needed gas to the mining and processing sector in the Mount Isa area, and is a positive for the local community, who will benefit not only from jobs which rely on gas as a direct feedstock, but from the flow-on effects of having a vibrant local economy and industry,” said Mr Boey.

Santos Managing Director and CEO Mr Kevin Gallagher said the NGP transportation agreement reached with Jemena is a great example of how Santos is collaborating across the supply chain to make domestic gas available where and when it is needed, efficiently and at competitive prices.
 
“This is a great commercial outcome for all the parties involved and it is also good for the east coast domestic gas market, connecting the Northern Territory into this supply grid,” Mr Gallagher said.
 
“It’s absolutely critical that we continue to open up new gas supply sources to service the domestic market as existing, mature fields decline.”

Construction of the Northern Gas Pipeline continues to track to schedule with first gas set to flow in late 2018.

Today’s agreement follows Jemena’s announcement that it has signed an agreement with Senex Energy to build, own, and operate the Atlas Gas Processing Plant and Pipeline, connecting Senex’s new ‘Atlas’ gas field in the Surat Basin in south-east Queensland with Jemena’s Darling Downs Pipeline and the Wallumbilla Gas Hub - the largest gas hub in the country.

For more information about the Northern Gas Pipeline visit www.jemena.com.au.

Jemena Media Contact 1300 331 239

Building a productive onshore gas industry that protects our unique environment and delivers local jobs

Government partners with CSIRO, Australia’s national science research agency Government this week signed a grant agreement with CSIRO’s GISERA (Gas Industry Social and Environmental Research Alliance) to engage the significant and trusted research capabilities of CSIRO to deliver independent and transparent advice to government on gas development in the Northern Territory.

The GISERA is an alliance involving Industry, Government and CSIRO contributing funds to undertake independent research projects relevant to the development and sustainability of the gas industry in regions. CSIRO’s GISERA aims are to:

• Carry out research and provide information for the benefit of all Australian communities in onshore gas regions and industry.

• Inform governments and policy-makers of key research outcomes.

Projects undertaken by GISERA are endorsed and effectively commissioned by a GISERA Regional Research Advisory Committee (RRAC). The committee reviews and approves all research projects, in order to ensure CSIRO’s independence.

The GISERA collaboration will progress research into the social, economic and environmental impacts of the onshore gas industry in the Northern Territory. The GISERA model will have a provision to include research partnerships with Northern Territory institutions and research bodies, and local business growth may be considered in project proposal development.

Read full bulletin here

Building a productive onshore gas industry that protects our unique environment and delivers local jobs

Update on Implementation It has been a little over a month since the release of the Implementation Plan for the recommendations of the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory.

The six major reform areas are focused on the priority areas of:

• strengthening regulation;

• ensuring industry is accountable for its practices;

• safeguarding water and the environment;

• respecting community and culture;

• maximising the benefits and opportunities available to local businesses and communities; and

• ensuring planning for future development.

Agencies responsible for implementation actions continue to progress program planning to deliver the recommendations as outlined in the Plan.

Read full bulletin here

DESPITE some mixed results from Origin Energy yesterday, and a spooked market, one of the highlights of the day was a firm announcement on next year's Beetaloo Sub-basin shale gas plans.

The Beetaloo is considered one of the most prospective parts of the Northern Territory and now the Top End has lifted its fraccing moratorium, albeit with 135 conditions, Origin and partner Irish Falcon Oil and Gas have committed to a new appraisal program for next year. 

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

The $60 million program is planned to identify a preferred play ahead of a 2020 pilot program and a possible declaration of commerciality the same year.  

The area may have yields of up to 60 million barrels of oil equivalent or 60 million cubic feet of gas, according to RBC Capital Markets.  

"We think the Beetaloo is an underappreciated facet of Origin's business," RBC said recently. 

"We feel it represents a material growth option for an entity that is somewhat growth constrained given its strong market position in energy wholesaling and retailing and the low return dynamics of new renewables investments." 

Until now the Velkerri B Shale has seen well tests while the Lower Kyalla Shale, which sits above it, has been less understood, although data from cores highlights the presence of both oil and gas. 

 Reservoir indicators include high porosity, hydrocarbon saturations, good source rock, middle to high condensate potential and which will likely be conducive to fraccing. 

 Previously what was known about the formation had suggested it was clay-prone and not suitable to fraccing.  

 The Beetaloo Sub-basin, part of the larger McArthur Basin, is estimated to hold almost 70% of the NT gas resources and the majority of relatively cursory exploration has been centred there.  

Source: Energy News Bulletin