The Northern Territory will call for expressions of interest in an Alice Springs to Moomba gas pipeline, which could help alleviate east coast gas shortages.
The Australian reports that Adam Giles, the territory’s chief minister, was confident construction could begin in 2016 after environmental impact assessments were quickly completed over 12 – 18 months.
The proposal was taken to last Friday’s COAG meeting and endorsed by attendees. Giles later met with industry minister Ian Macfarlane over the weekend.
“This project will provide jobs and infrastructure for the Northern Territory and particularly indigenous communities,” Giles told The Australian.
Speaking on Friday, Giles said the project would be a “win-win” and an important nation-building project.
“The eastern states are fast approaching a gas supply crisis and the Territory has the solution. 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,” he said.
“A pipeline is a win-win that would connect natural gas companies with potential buyers in the eastern states, while also creating economic opportunities for the Northern Territory.”
Manufacturing Australia is in favour of the NT-SA project, also suggesting a trading hub be established at the terminus in Moomba.
The trading hub would help provide greater transparency in an uncompetitive gas market, and could be established by the Australian Energy Market Operator and functioning within 12 months, according to the industry lobby group
“A gas trading hub at Moomba would increase price transparency, provide more options for trading gas and make it easier for smaller gas producers to access and individually market gas,"said Ben Eade, Manufacturing Australia’s executive director.
The looming gas shortage is hugely concerning for manufacturers, especially in NSW, with supply tightening as LNG exports from major projects begin over the next two years.
Manufacturing Australia earlier this year put the cost of inaction on gas at 100,000 direct jobs in the industry.