Natural gas could give NT the economic stability it needs
August 26th, 2016
The Northern Territory goes to the polls this weekend. If the commentators’ predictions are accurate, there will be a change of Government.
With that will come a halt to planned development of natural gas resources. It may be only a pause, rather than an end, but it will be a period of uncertainty – and that is not what the NT needs now.
The NT economy is stalled. Construction has come to a near halt, housing values are falling, and the outlook for growth is dim, with population growth going into reverse.
Against that background, the NT Urban Development Institute has identified development of onshore natural gas resources as an important opportunity which should be embraced no matter which Party wins Saturday’s election.
In a piece for the NT News this week, the Institute’s CEO, Graeme Suckling, urges the Labor Party to quickly consider its proposed moratorium on proposed onshore gas development if it wins power.
Onshore gas has the potential to support decades of vital energy supply, significant royalties to Government, a major employment boost and benefits to agricultural and regional communities.
Mr Suckling says the NT always struggles in the absence of a major project, and that development of onshore gas has the right attributes to fit the bill for the Territory for the next period of employment stimulus and economic growth.
“It seems the Northern Territory is unable to shake off the cyclic, roller coaster nature of our economy, characterised by significant peaks and troughs in employment. A key reason for this has been periodic major projects, as well as external impacts on the major industries which drive our economy,” he says.
“Of all our current major industries, onshore gas appears to have strong potential to shift the NT economy towards a more stable pattern, at least in the long term.”
Mr Suckling identifies a number of supporting facts:
- Onshore shale gas is a proven, economic energy source and known reserves can provide decades of supply;
- The gas reserves belong to the NT and a long-term flow of royalties will stay in the NT when the gas is produced. (In fact, a report by Deloitte Access Economics estimated the benefit to be 6,300 jobs and $22 billion injection into the NT economy);
- Onshore gas has many uses which can add value to the economy, such as through providing energy for manufacturing, reducing the costs of power generation on cattle stations and communities, and enabling the establishment of new industries based on byproducts from the gas itself;
- Access to a stable, relatively clean source of energy can help Australia and the NT transition to renewable energy sources over coming decades.
But what about environmental concerns? Mr Suckling has researched this topic and come to the conclusion that appropriate safeguards can provide the necessary environmental assurance:
“We believe a well-managed and properly regulated onshore gas industry has the potential to change our economy significantly over the longer term. Hence if voters support Labor’s position on this issue, UDIA (NT) will be advocating for a timely, scientifically valid and objective evaluation of the environmental and economic impacts, as well as benefits, of the shale gas industry.”
We couldn’t agree more.