The gas industry’s peak body says licences to begin fracking in the Northern Territory could be issued in a month, despite the government missing a key deadline.
Key points:
- A gas industry representative says it expects Beetaloo fracking production licences could be issued in a month
- But critics say fully implementing Pepper Inquiry recommendations is “impossible”
- The industry is ready to ramp up production “very quickly” as exploration continues
The NT government had repeatedly claimed it would implement all 135 recommendations of the Pepper Inquiry by the end of 2022, paving the way for industry to ramp up production in the Beetaloo Basin.
The Beetaloo Basin is located 400 kilometres south of Darwin and stretches across an area more than twice the size of Tasmania, which contains enough shale gas to power Australia for an estimated 200 years.
Since the Northern Territory government lifted a temporary ban on fracking in 2018, a number of exploration permits have been issued to gas companies in the region.
But the NT government has promised to implement all 135 recommendations of the Pepper Inquiry – intended to mitigate the risks associated with any onshore shale gas development – before it allows companies to move into production.
Despite being “due for completion” by the end of 2022, according to the NT government’s website, 35 recommendations were yet to be completed.
NT environment minister Lauren Moss said all the recommendations would be implemented before production begins.
But critics and environment groups have maintained the recommendations were “impossible” to enact and have raised concerns the NT government is caving to pressure from the oil and gas industry.
Ms Moss said the work had been “done” and would be considered by government “in terms of whether that’s now implemented at the level that we expect before moving to production.”
Latest Oil News
Australian Petroleum Production and Exploration Association (APPEA) NT director David Slama said he expected the recommendations to be fully implemented within the next four weeks.
“Assuming that after that the green light is turned on, that should give existing gas explorers the opportunity to apply for production licences,” Mr Slama said.
“I’m very much expecting several production licences to be issued,” he said.
Offsetting emissions ‘achievable’
Research director of the Australia Institute Rod Campbell said it was unsurprising the government had missed its own deadline.
“It’s pretty clear that the government hasn’t been able to implement all of those recommendations, in part because at least one or two of them are impossible,” Mr Campbell said.
A December report from David Ritchie – the bureaucrat tasked with overseeing the government’s implementation of the inquiry’s recommendations – said the details of how a key measure would be implemented was “still being worked out”.
The climate safeguard – known as recommendation 9.8 of the inquiry – requires the NT to ensure there is no net increase to Australia’s emissions as a result of onshore gas development.
The volume of emissions from large-scale production in the Beetaloo is expected to be massive, with doubts raised within government about whether there are enough available carbon offsets in Australia.
Mr Campbell said the NT fracking industry would need to buy about a third of the offsets market that’s available in Australia, which he labelled an “impractical amount”.
“The offsets just aren’t there, and the ones that are there, and the integrity of them – whether or not they actually do what they say – is open to question,” Mr Campbell said.
But APPEA NT director David Slama said offsetting emissions from the Beetaloo was “very much achievable” using carbon capture and storage (CCS) technologies.
“Carbon capture is very much a key to it. It’s not the only thing [but] it is one of the big cogs in the delivery of a greener gas,” Mr Slama said.
Ms Moss said Mr Ritchie would “provide his advice” about the implementation of the remaining recommendations.
Concerns over pressure on government
Hannah Ekin from the Arid Lands Environment Centre said the NT government was “under enormous pressure” from the gas industry to implement the Pepper Inquiry recommendations and move towards production.
“It’s just a matter of trying to push it through as quickly as possible and with as minimal oversight as possible,” Ms Ekin said.
Rod Campbell said the push to develop the Beetaloo was part of a “rush to production” for fossil fuel projects across Australia.
“Gas companies have a massive incentive to set up as much infrastructure and get as much done as they can before climate regulations and climate policy start to bite,” he said.
Ms Moss dismissed claims the industry was putting pressure on government to lower standards or rush implementation of the inquiry’s recommendations.
“Obviously, the gas companies would love to be in production as soon as possible, but they know what we’ve committed to,” Ms Moss said.
Mr Slama said there were “no shortcuts” in implementing the inquiry’s recommendations.
“We’ve been working with government for the last four years around the practical delivery of this … there’s no such thing as making it happen quickly, it’s about getting it right,” Mr Slama said.
Gas industry ready to go
Mr Slama said gas companies would be ready to ramp up production in the Beetaloo Basin “very quickly” if permits were approved.
Two gas companies operating in the region recently reported successful drilling of exploration wells.
Empire Energy hydraulically stimulated two wells in December and January, with test flows to start “shortly”, according to an announcement to the stock exchange.
“These results further increase the team’s confidence as we drive towards early commercialisation,” managing director Alex Underwood said.
“The strong cost performance of this program leaves Empire well-funded for the critical upcoming work required to make a final investment decision.”
Tamboran Resources reported it had drilled a well to a total depth of 3,883 metres, with plans to frack the well in the first quarter of 2023, subject to weather conditions.
