Construction begins on Northern Gas Pipeline

The AUS$800 million pipeline will connect the Northern Territory to the national gas grid, and has been touted as a possible solution to the supposed east coast gas shortage.

Michael Pintabona, spokesman for the company behind the project, Jemena, said the pipeline was being built to transport 90 TJ/d of gas to Mount Isa, but to contribute any more gas than that, the project would need a more consistent supply.

Currently the gas came from the Black Tip Point reserve, but Mr Pintabona said if more became available the pipeline could be expanded to transport up to 700 TJ, however a current moratorium on hydraulic fracturing in the NT was currently limiting that potential.

If the moratorium was lifted, and areas such as the Beetalo Basin, which was in exploration phase only, put their hand up to have gas transported Mr Pintabona said it would be ideal for the pipeline.

"Our initial foundation customer is a domestic customer, and it is about making sure there is more gas available in the whole of the east coast," he said.

According to the company the project will supply 900 jobs over the construction, with 600 of those jobs earmarked for locals, but it was not entirely clear on how many of those would be ongoing.

The company plans to have first gas on by the end of 2018.

"Our ambition is for 2017 to build about 200 km of the pipeline here in the territory, and to build all of the pipeline in Queensland, as well as the Phillip Creek compressor station," Mr Pintabona said.

"What people can see immediately is next week the final shipment of the pipe will land in Tennant Creek.

"There's about 35 000 lengths of pipe and each length of pipe is about between 15 - 18 m long."

At a sod-turning ceremony in the NT, Jemena managing director Paul Adams said the 622 km pipeline between Tennant Creek and Mt Isa will play a crucial role in helping to resolve Australia's gas supply crisis.

Mr Adams says the energy infrastructure company is investigating extending the pipeline south from Mt Isa to the Wallumbilla Gas Hub to further integrate Territory gas into the east-coast gas grid, provided additional gas supplies are made available in the Territory.

"Our modelling suggests that the pipeline can be relatively easily expanded and extended to transport up to, or beyond, 700 TJ/d of gas. This far exceeds gas used on an average day in the NSW and Queensland markets," he said.