Ms LAWRIE - 2012-10-24
Have you convened a meeting of the Gas Task Force following the announcement by Pacific Aluminium that they are reviewing the mines operation? Last month you promised that you would deliver gas to Nhulunbuy. The mine is the life blood of the town, of the workers, of the small businesses and the traditional owners. What action have you taken to secure gas to Nhulunbuy?
ANSWER
Madam Speaker, I thank the honourable member for the question. Leader of the Opposition, this is a very important question and I acknowledge that this matter was in existence prior to the change of government. I acknowledge the initial work that was done in correspondence between the former Chief Minister and Pacific Aluminium. The work has now continued and the pace has quickened because of the tighter time frame we now have to operate under.
As I said - and correctly reported by the Opposition Leader - there was a decision to bring together a task force to focus specifically on all issues related to this very important matter; they are meeting regularly and I have regular updates. Only last Thursday, I met with the CEO of Pacific Aluminium, Sandeep Biswas, and we have had extensive correspondence quite regularly with the CEO of Pacific Aluminium and the manager at the plant, Duncan Hedditch.
The issue - as you probably understand and would be well briefed on, I am sure - is that the mine has increased its productivity, and I commend them for that. The problems is that the price of aluminium has dropped, which makes it a difficult proposition. On top of that, the cost of fuel oil, combined with the high Australian dollar, has made it a difficult case for Rio Tinto to consider its forward operation.
The only solution is for the supply of additional gas - there are two options: one is the supply of gas from our own reserves which, as members opposite and honourable members would understand, creates a problem of sovereign risk for the Northern Territory, which has to be weighed up very carefully. The solution lies with increasing other supply to allow a secure case to be put over a 10-year period so that pipeline could be built.
I am also pleased to advise the House that correspondence and conversation with Martin Ferguson, federally, has been very positive. I am going into this with an attitude that this can be solved. The risk has to be reduced as far as possible on our side of the equation. Our challenge is to ensure additional gas is brought in to solve this problem.
I am pleased to report also that ENI has increased its tempo in exploration at the Blacktip field and additional exploration in the Mereenie field with up to 20 different exploration holes being drilled, because there is now demand for gas supply.
ANSWER
Madam Speaker, I thank the honourable member for the question. Leader of the Opposition, this is a very important question and I acknowledge that this matter was in existence prior to the change of government. I acknowledge the initial work that was done in correspondence between the former Chief Minister and Pacific Aluminium. The work has now continued and the pace has quickened because of the tighter time frame we now have to operate under.
As I said - and correctly reported by the Opposition Leader - there was a decision to bring together a task force to focus specifically on all issues related to this very important matter; they are meeting regularly and I have regular updates. Only last Thursday, I met with the CEO of Pacific Aluminium, Sandeep Biswas, and we have had extensive correspondence quite regularly with the CEO of Pacific Aluminium and the manager at the plant, Duncan Hedditch.
The issue - as you probably understand and would be well briefed on, I am sure - is that the mine has increased its productivity, and I commend them for that. The problems is that the price of aluminium has dropped, which makes it a difficult proposition. On top of that, the cost of fuel oil, combined with the high Australian dollar, has made it a difficult case for Rio Tinto to consider its forward operation.
The only solution is for the supply of additional gas - there are two options: one is the supply of gas from our own reserves which, as members opposite and honourable members would understand, creates a problem of sovereign risk for the Northern Territory, which has to be weighed up very carefully. The solution lies with increasing other supply to allow a secure case to be put over a 10-year period so that pipeline could be built.
I am also pleased to advise the House that correspondence and conversation with Martin Ferguson, federally, has been very positive. I am going into this with an attitude that this can be solved. The risk has to be reduced as far as possible on our side of the equation. Our challenge is to ensure additional gas is brought in to solve this problem.
I am pleased to report also that ENI has increased its tempo in exploration at the Blacktip field and additional exploration in the Mereenie field with up to 20 different exploration holes being drilled, because there is now demand for gas supply.
Last updated: 09 Aug 2016