NT Government defends $250k payment to energy company ConocoPhillips for gas feasibility study

MEDIAONETIMOR-Northern Territory Chief Minister Michael Gunner has defended spending taxpayers’ money on a feasibility study for multinational gas company ConocoPhillips.

The Government has put forward $250,000 to assess the economic viability of constructing a second train at the Darwin LNG facility at Wickham Point.

An LNG train is a processing facility that cools and liquefies natural gas, so its volume can be greatly reduced for transportation and storage.

ConocoPhillips operates the Darwin LNG facility, which exports enough liquid natural gas (LNG) each week to power 220,000 homes in Japan for a year.

The facility has been in operation since 2006 and receives gas from the Bayu-Undan field, north of Australia, via a 502-kilometre pipeline.

But that gas is due to run out in 2022, and ConocoPhillips is looking at backfill options, including the Barossa and Greater Poseidon gas fields.

ConocoPhillips vice president of external affairs Kayleen Ewin said the company was also exploring the possibility of expanding the Darwin LNG facility.

“Given the vast size of gas that has been discovered in northern Australia, there’s a further opportunity to build a second train to commercialise even more gas,” she said.

‘Partnering with private sector vital for economy’

The Northern Territory Government is facing multiple economic challenges, including significantly reduced GST revenue and the end of the construction phase of the multi-billion-dollar Inpex gas plant in Darwin.

Mr Gunner said partnering with the private sector on potential job creation projects was vital for the economy.

“You saw the Prime Minister the other day do a feasibility study around Snowy two,” he said.

“I think supporting private investment through things like feasibility studies are good things and I’ll do them if I think they will stack up and will lead to jobs for Territorians.”

Opposition Leader Gary Higgins was unsure if it was the right approach.

“While I agree $250,000 is a large outlay to a private company, I’d like to see the benefit we are going to get from it before I openly criticise the Government,” he said.

The current LNG train at Wickham Point cost about $1.3 million to build between 2003 and 2006.

It also created 2,500 jobs during construction and led to 250 ongoing jobs.

ConocoPhillips said a future LNG train could cost about $8 billion.(By Jano Gibson) 

 

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