Jan 06, 2016

Pipeline of opportunity

Pipeline of opportunity

A gas industry forum is planned for Mount Isa in early 2016 to make the most of local opportunities stemming from an

$800 million pipeline project.

The Northern Territory Government’s selection of Jemena Northern Gas Pipeline to construct and operate the North East Gas Interconnector (NEGI) pipeline has guaranteed a Tennant Creek-Mount Isa gas route.

Mount Isa to Townsville Economic Development Zone (MITEZ) executive officer Glen Graham said the group would bring parties including the pipeline operator, regional contractors and major energy users together to ensure the region maximised the benefits.

The forum was likely to be held in early April, he said.

“In addition to that, we’re hoping to be able to fi nd funding for a strategic study identifying the potential benefits arising from a gas pipeline and how the dynamic of that would create opportunities for opening new mines and mineral processing operations along the corridor,” Mr Graham said.

Mr Graham said it would be advantageous to identify potential off take points as soon as possible.

Jemena expects construction of its 14-inch pipeline, which will A forum planned in Mount Isa will look at value adding to the energy bonanza run for 622km between Tennant Creek and Mount Isa, to be complete by 2018.

The project will create more than 900 jobs during construction and there will be ongoing maintenance and operations teams based in Tennant Creek and Mount Isa.

Incitec Pivot’s Phosphate Hill operation, 160km south of Mount Isa, has already been confirmed as an off take partner, announcing a long-term gas supply agreement with the Northern Territory’s Power and Water Corporation as a result of the pipeline approval.

Gas is required for the manufacture of ammonium phosphate fertilisers at the site and IPL’s current gas contract (2015/16), negotiated in an environment of gas producers committed to LNG export, has added about $50 million a year to the cost of operating the plant.

IPL chief communications officer Stewart Murrihy said the agreement announced in association with the NEGI pipeline would assist in providing secure gas supply at a competitive price.

It is estimated the NT has more than 200 trillion cubic feet of gas – potentially enough to power Australia for more than200 years.

Jemena managing director Paul Adams said routing the pipeline to Mount Isa was the most efficient way to get gas to the east coast, as it reduced potential construction risks and required lower volumes of gas to be contracted to be viable.

“As soon as sufficient gas is proven in the NT, Jemena will seek to build a further link connecting Mount Isa to the Wallumbilla hub in Queensland,” he said.

“This will vastly improve the reliability of the gas transmission network by reducing sole reliance on Moomba as the hub for supplies. It will also introduce some much-needed competition into the east coast market, while accelerating the growth of the NT gas sector.”

Mr Adams said Jemena had been working closely with communities and businesses along the proposed route from the start of the bidding process, to harness as much local and Indigenous participation as possible in the delivery and ongoing management of the pipeline.

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