Global energy majors BP and Shell are considering buying shale gas from the Northern Territory’s environmentally and culturally sensitive Beetaloo Basin within the next decade if an ambitious new gas export project goes ahead.
Tamboran Resources, an ASX-listed junior gas developer, said on Friday that it had signed non-binding initial agreements with BP and Shell over the potential purchase of liquefied natural gas (LNG) from its proposed production project at Middle Arm. Tamboran owns assets in the Beetaloo Basin, believed to be one of the world’s biggest untapped gas reserves, and is preparing to begin drilling works as soon as next month.
“BP and Shell are two of the world’s largest LNG portfolio trading and energy companies and provide important and credible counterparties for Tamboran to progress financing discussions to support the sanctioning of the NTLNG project, capable of producing up to 6.6 million tonnes per annum,” Tamboran chief executive Joel Riddle said.
They are aiming for first gas from as early as 2025, and a potential LNG export plant from 2030.
The memoranda of understanding come after the NT government this year cleared the way for companies to resume fracking, a process involving injecting high-pressure fluid into bedrock to force the extraction of gas, after a moratorium was lifted five years ago.
The move to develop what could be a vast new gas production sub-basin has been welcomed by the oil and gas sector, which says extra volumes of the fossil fuel will provide a lucrative economic opportunity for the nation and help shore up east-coast energy security later this decade, when the Australian Energy Market Operator (AEMO) is bracing for an increased threat of domestic shortfalls.
However, fracking plans in the region have met a wave of opposition from environmentalists who fear it will drive up Australia’s carbon footprint and add to the worsening climate crisis. Some traditional owners have also objected to fracking in the region amid concerns about its impacts on their ancestral waters and lands.
In May, a coalition of 96 leading Australian scientists, co-ordinated by the Australia Institute think tank, published an open letter in national newspapers warning of the climate damage it could inflict.
“Opening up new fossil fuel extraction projects of this scale is at odds with the government’s plan for net-zero by 2050,” said Matthew England, a professor at the University of New South Wales Climate Change Research Centre.
Shares in Tamboran were halted on Friday as the company moved to raise more capital to fund its Beetaloo Basin activities.
Also on Friday, Tamboran told shareholders it had selected gas pipeline company APA Group to connect its Beetaloo Basin assets to the existing east-coast gas transmission network via the South West Queensland Pipeline, and to Tamboran’s proposed Middle Arm development.
APA managing director Adam Watson said the company was committed to working closely with landholders, communities and First Nations stakeholders. He said that continued investment in gas would be essential in driving the energy system’s transition to renewables.
“Unlocking the Beetaloo will be key to supporting this as coal is replaced with renewable generation and backed with gas firming,” he said.
Proponents of gas bill it as the necessary “transition” fuel in the shift to clean energy – a power source with half the typical life-cycle emissions of coal, which can still be reliably called on to back up renewables when the wind isn’t blowing and the sun isn’t shining.
Climate advocates, however, say it remains a significant source of emissions that must be phased out, not expanded, to avoid the worst effects of climate change.
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Source: Thanks smh.com