The recent Northern Territory (NT) Budget highlighted natural gas as a crucial transition fuel to support the shift towards renewable energy and net zero emissions, which the Territory aims to achieve by 2050.
NT Minister for Renewables and Energy Kate Worden told Petroleum Australia that the Territory government was working to build its economy to $40 billion by 2030, with developing the Beetaloo Basin and boosting the onshore gasindustry a significant part of this effort.
Three companies are currently exploring and developing in the Beetaloo Basin: Tamboran Resources, Empire Energy, and Santos. Tamboran Resources holds net 2C contingent resources of about 1.5 trillion cubic feet, and is targeting first production by the end of 2025.
Late last year Tamboran completed its acquisition of Origin Energy’s gas assets in the Beetaloo, making it the largest acreage holder and operator in the region. Minister Worden noted that the gas arrangements between the Territory government and Tamboran would provide competitively-priced gas for the Territory’s electricity generation.
She said: “Once Tamboran secures access to the necessary pipelines and receives all required permits and approvals, supply to the Territory government becomes unconditional. “This historic deal ensures that Territory residents, businesses and industry will share in the benefits of our growing onshore gas industry by delivering cleaner and more affordablenatural gas for power generation.
“The first gas from the Beetaloo Basin that will be delivered to Territory power generators is expected in the first half of 2026 – the deal will provide gas to Territory power generators for nine years with an option to extend for another six-and-a-half years.”
In April, Empire Energy raised more than $46 million to progress drilling in the Beetaloo, including a pilot development well for pre-production testing, and is anticipating first commercial production by 2025 with the first supply of natural gas going to the Northern Territory market.
Previous drilling enabled Empire to substantially upgrade its Beetaloo gas resources, with a 270 per cent increase in 2C contingent resources to 1,739 petajoules; a 217 per cent increase in 1C contingent resources to 304 petajoules; and a 129 per cent increase in 3C contingent resources to 3,507 petajoules.
Beetaloo spans an area of about 30,000 square kilometres southeast of Katherine and has been identified as a potential area for onshore gas production, with an estimated 180,000 petajoules of natural gas.
Research has indicated that Beetaloo’s development could create up to 6,300 jobs and deliver $1 billion in total revenue to
the NT government by 2040, as well as generating $22.4 billionin NT economic growth. Minister Worden explained that all projects proposed for Beetaloo needed to submit an environmental plan which would be rigorously and thoroughly checked by the independent NTEnvironmental Protection Agency.
She said: “In 2018, the Scientific Inquiry into Hydraulic Fracturing, chaired by Justice Rachel Pepper, independently concluded in its final report that industry risks could be managed if all of the Inquiry’s 135 recommendations were implemented.
“Over the past four years, the Territory government has been working to implement those recommendations by undertaking comprehensive baseline studies and developing multiple assurances for the regulation and monitoring of an onshore gas industry.”
A unique factor of Beetaloo’s gas is its low carbon dioxide content, making it particularly effective as a replacement for higher emitting fuels like coal, as a back-up for renewable power generation, and as a feedstock for hydrogen.
Along with onshore development in the Beetaloo, the Middle Arm sustainable development precinct near Palmerston will be a key plank of NT’s economic growth, presenting the opportunity to create about 20,000 direct and indirect jobs for the Territory.
Australian Energy Producers NT Director David Slama said the Budget showed the Territory government was focused on delivering practical solutions on the road to net zero, and underscored the importance of gas in Australia’s energy transformation.
Slama said: “The Budget continues to help progress development of the extraordinary opportunity of the Beetaloo Basin and Middle Arm sustainable development precinct, while reinforcing the economic importance of the Barossa project. “The oil and gas industry also supports the Resourcing the Territory exploration program, delivering investment in the NT and supporting new energy supply with all of its benefits.”
Slama said the Budget provided for a more sustainable energy future, while helping secure economic and energy security benefits by developing the Territory’s onshore natural gas resources. He added: “The Budget invests in the industries and projects required for the energy transformation.”
LNG exports are projected to continue to be a major economic driver for the Territory, which will push growth in gross state product from 2.3 per cent in the coming financial year to 7.1 per cent in 2025-26, when LNG exports from Barossa are expected to begin. Slama continued: “Growing LNG demand in our region is an enormous economic opportunity for the Territory and we welcome the federal government’s commitment in the Future Gas Strategy that Australia will remain a reliable and trusted trade and investment partner.
“Our LNG exports have an important role to play in the energy security and decarbonisation of our region, in addition to the significant economic and strategic benefits from Australia’s key trading partners.” Scheduled for first production in the first half of 2025, the Barossa project will supply replacement gas to the Darwin LNG (DLNG) plant, which is currently fed by the soon-to-be-depleted Bayu-Undan field near Timor-Leste.
Gas will be extracted about 285 kilometres offshore from Darwin and transported via pipeline to DLNG, with other project infrastructure including a floating production storage and offloading (FPSO) facility, a subsea production system, and supporting in-field subsea infrastructure.
Up to eight subsea wells are planned to be drilled, with six wells from three drill centres and contingency plans for an additional two wells. After gas and condensate is extracted from the wells through the subsea production system, it will be transferred to the FPSO via a network of subsea infrastructure.