Northern Territory treasurer Eva Lawler has insisted an ambitious economic target is still on track despite disruptions to major gas projects.
- Two major NT gas projects have faced disruptions in the past week
- The NT government is relying on major gas projects to reach its 2030 goal of a $40 billion economy
- Experts say the government should pivot to investing in renewable projects
Recent decisions involving gas giants Origin and Santos have raised questions about the future of gas in the territory, where mining and manufacturing represents about a quarter of gross state product.
But Ms Lawler said she remained confident the territory economy would grow to the target of $40 billion by the end of the decade — up from the current $26 billion.
“To drive this, we have been working on a range of major projects by both government and private sector,” she said in a statement.
“We have not pinned all our prospects to a single venture or a single resource.”
However, some observers say the separate shake-ups have shown the risk of continued focus on the oil and gas sector.
“You’ve seen how quickly the rug can be pulled — two big projects in a single week,” said renewable energy advocate Eytan Lenko, who sat on a recent government economic taskforce.
“We’re on much safer ground if we’re facing the future and we’re encouraging projects that are future-proof and are going to be beneficial to the economy for the long-term future, versus things that we know we’re going to have to phase out.”
Tamboran investment shows vote of confidence: industry
After years of exploring the region, Origin last week sold its gas exploration interests in the Beetaloo Basin at a multi-million dollar loss, to focus on other priorities including the transition to clean energy.
Days later, the Federal Court overturned an approval for a major offshore project spearheaded by Santos after a challenge by traditional owners, halting drilling at a $4.7 billion project the company has previously described as the biggest investment in Australia’s oil and gas industry in almost a decade .
The nation’s peak oil and gas body has suggestions Origin’s exit heralds a declining role for gas, instead reframing a decision by gas company Tamboran to buy its interests as a vote of confidence.
“The gas industry has been a critical driver of the economy in the Northern Territory and nothing in the past week has changed this,” Samantha McCulloch from the Australian Petroleum Production and Exploration Association said.
“Among the announcements we saw this week was Tamboran’s intention to invest $60 million in the Beetaloo Basin, so the industry is continuing to invest in the Territory today and in the future.
“Onshore and offshore gas can play a very substantial role in reaching that  target.”
Announcing its intention to appeal the court decision, Santos said “project approval uncertainty is a public policy issue that should be urgently addressed by Australian governments to reduce risk for trade and investment in around the country”.
A spokesperson for Federal Resources Minister Madeleine King said the federal government was considering the implications of the ruling.
“It is a matter for Santos to consider what the decision means for the Barossa project,” her spokesperson said in a statement.
Renewable energy could help reach goal
The post-coronavirus economic taskforce that set the 2030 target encouraged the government to reach it by aggressively pursuing private investment.
Their report drew emphasis on the role of the territory’s gas reserves in sustaining the economy during the transition to renewables.
But Mr Lenko, who sat on the taskforce, said renewable energy investment could carry the government to its goal.
“Hopefully the penny’s dropping that gas isn’t as sure a thing as they thought, and there’s a lot of resources in the government working to develop the gas industry,” he said.
“Those resources should really be repurposed to help push the renewables side of the economy much further.”
APPEA said gas would play a long-term role as coal-fired power generation is phased out nationally.
The government has signed a range of agreements related to green hydrogen, carbon capture and storage and electric vehicle battery manufacturing with private companies in recent months.
The territory’s gross state product grew by six percent to $26.3 billion in 2019-20, then decreased slightly to $26.2 billion the following financial year.