APA Group has stood by its plan to build a natural gas
pipeline from the Northern Territory to the eastern states, despite claims that
it is not viable.
According to The Australian Financial Review, the idea has
come in for criticism from several critics, including the Grattan Institute.
That organisation’s energy program director Tony Wood told
the AFR that the project, which would cost up to $1.3bn, would require huge
public subsidies and would not address east coast’s gas supply shortfall.
“There’s no way you could see it being landed at a
price (in NSW) below [$8 to $10 per gigajoule]. It doesn’t solve for either
price or volume,” Wood told The AFR.
However, APA Group chief executive Mick McCormack was not
swayed by the criticism and told the AFR that cost or distance would not stop the project from proceeding.
“Slowly but surely the market is being tested as to, is this
project a goer or not,” he said.
“For all the naysayers that is the first thing to point out
that there is a potential user of gas that is reasonably close to gas that
could come out of the NT.”
Possible routes for the pipeline include from Alice Springs
and Moomba in South Australia or Tennant Creek to Mount Isa in Queensland.
The proposal received a boost on Tuesday when Fertiliser and explosives maker Incitec Pivot signed a non-binding natural gas supply deal
with onshore gas junior Central Petroleum. The deal would require the pipeline to go
As the ABC reports, the New South Wales Government has offered
its support for the proposal. Last week, NT Chief Minister Adam Giles signed a
memorandum of understanding on the pipeline project with his NSW counterpart,
Premier Mike Baird.
The NT government is expected to make an announcement on the
plan within days.