Northern Territory Braces for Christmas Blackouts as Cyclone Fina Disrupts Gas Supply & Exposes Energy Vulnerability

Northern Territory on Edge: Christmas Blackouts Possible Amid Gas Supply Crisis

Residents of the Northern Territory are facing the stark possibility of rolling blackouts throughout the Christmas period, a concerning development sparked by ex-Tropical Cyclone Fina. The severe weather event forced the unexpected shutdown of the NT's primary gas supply, throwing the region's energy security into question.

On Friday, NT Deputy Chief Minister Gerard Maley confirmed that authorities have activated contingency plans, tapping into backup gas reserves from Central Petroleum's Amadeus Basin operation, located west of Alice Springs. This crucial supply is currently maintaining power to the major population centers of Darwin and Katherine. However, Maley issued a serious warning: should these backup reserves deplete, the government would be compelled to switch to burning expensive diesel, a fuel source costing twice as much as gas.

"If we have to rely on diesel, there could be a [possibility] that we'll have to load shed, which will mean blackouts across the Darwin and Katherine network," Mr. Maley stated, emphasizing the government's desire to keep Territorians informed rather than alarmed. The NT's electricity grid is predominantly fueled by gas, making disruptions to its supply particularly critical.

The Cyclone's Impact and Contingency Measures

John Pease, Deputy Chief Executive of Power and Water Corporation (PWC), explained that the Blacktip gas field, a key source for the NT, is temporarily offline. Its operator, Eni Australia Limited, is currently assessing damage caused by the cyclone. Eni's headquarters in Italy, when contacted for comment, did not provide a response.

Despite describing the Blacktip shutdown as an "unexpected event," Pease maintained that widespread power outages remain "unlikely" due to multiple contingency measures in place. These include an increased gas supply from Inpex. Nevertheless, he acknowledged the potential for temporary, hour-long power cuts to specific suburbs if electricity demand outstrips supply.

"If we ended up in that situation, we would be giving notice to Territorians of where and when that would occur so people can plan and minimise the disruption," Pease assured, highlighting efforts to mitigate the impact on residents. Gerard Maley reiterated the government's commitment to taking "every possible step to keep the lights on."

A Deeper Look at the NT's Energy Challenges

This current predicament casts a spotlight on the Northern Territory's persistent energy vulnerabilities. A 2009 deal with Eni for gas from the Blacktip field in the Joseph Bonaparte Gulf, valued at $5.5 billion, was intended to secure the NT's gas-fired electricity grid and even produce a surplus. However, the Blacktip field has faced significant underperformance since early 2021, forcing PWC to procure costly emergency gas from alternative sources.

While Mr. Maley views the current crisis as reinforcement for fast-tracking gas extraction from the Beetaloo Basin, a gas analyst from the think tank the Australia Institute, Mark Ogge, offered a critical perspective. Ogge pointed out that multinational oil and gas companies export approximately 80 percent of Australia's gas overseas, leading to domestic supply issues.

"Gas exports are the problem," Ogge asserted. "The territory continues to stumble between one kind of energy crisis to the next even though there's massive amounts of gas produced here." He criticized the control exerted by large multinational corporations over this gas, stating they "run rings around governments." Ogge concluded by highlighting the irony: while vast quantities of gas depart Darwin Harbour daily, the NT government may have to import gas from eastern Australia at taxpayer expense, underscoring a fundamental flaw in the nation's energy policy.