In Australia, Northern Territory grants ‘major project status’ to 1,000km gas pipeline to the east

The Northern Territory has moved ahead with plans to build a 1,000-kilometre pipeline, expected to cost more than $1 billion, to supply natural gas to eastern Australia. Chief Minister Adam Giles, an advocate of the plan, used the occasion of the Australia-Japan Joint Business Conference in Darwin to announce the pipeline had been granted « major project » priority status. He said the pipeline, which did not yet have a private backer, needed to be operational by 2018 to avert an « East Coast gas crisis shortage ». « There is no time to waste, and the granting of major project status to the pipeline will help speed up this process, » he said. « We have the gas and they have the demand, but there is currently no economically viable way to get the gas from Northern Australia to the eastern market. » The pipeline has Federal Government backing, but some industry observers have dismissed it as a « pipe dream ». It was not among the 40 recommendations tabled in the Federal Parliamentary Committee’s Inquiry into the Development of Northern Australia report released in September. Potential investors will be able to lodge formal expressions of interest in building and operating the pipeline next month. Hundreds of delegates from some of Japan’s largest corporations, including Mitsubishi, Toyota and Nippon Steel, have attended the business conference to discuss emerging trade opportunities, namely in the areas of food, energy and education. Federal Industry Minister Ian Macfarlane said the NT had an opportunity to supply Liquefied Natural Gas (LNG) to Japan, which had been looking for alternatives to nuclear power. « Japan is going through a transition with its energy production, » he said. « It has closed down its nuclear facilities. « Most of them are yet to be decided on whether they will reopen but in the short to medium term, there is enormous demand there for gas. » Taiwanese and Japanese utility companies had already bought the first 15 years of gas production from the $33 billion Inpex project, which was to come online in 2017. The NT would consider proposals for any pipeline route linking with the east coast grid. Australia’s largest pipeline owner, APA group, had investigated three potential routes – Alice Springs to Moomba (1,100km), Tenant Creek to Mt Isa (620km), and from a point midway between Alice and Tenant Creek to intersect with Queensland’s Carpentaria Gas Pipeline (700km). It estimated any route would cost up to $1.3 billon and not be built before 2020. The NT and the Federal Government had ruled out investing taxpayer money in the pipeline, meaning it would have to be funded entirely by the private sector.