Darwin
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The importance of today’s announcement of a final investment decision on the Ichthys liquefied natural gas (LNG) project should not be underestimated.
It heralds the beginning of a new era for the Northern Australia as a major regional player in LNG.
It confirms Australia as a world leading investment destination for LNG development increasing total committed capital expenditure on LNG projects to over $175 billion.
It strengthens our international trade relationships and boosts our status as a major player in international global resource and energy supply.
It is the largest single investment by Japan and France in Australia and the first LNG project to be operated by a Japanese company worldwide.
It establishes France as a major presence in the Australian LNG industry.
It also includes the first binding long-term LNG sales contract for the supply of Australian LNG to Taiwan – opening up a lucrative new market.
Investments like the Ichthys Project mean prosperity and opportunity for Australians and for those nations turning to Australian LNG as a source of clean energy.
The Australian Government has been involved with the Ichthys Project from day one.
It was the Government, on behalf of the people of Australia, which in 1998 granted a permit -- WA-285-P under international tender -- to INPEX to explore in the Browse Basin.
But the Ichthys project is unique involving, as it does, the production of gas in waters administered on behalf of the Commonwealth, until very recently by the Western Australian Government, and its transport via pipeline to be processed onshore in the Northern Territory.
It exemplifies the commitment across Australia’s different jurisdictions to work co-operatively to ensure the sustainable development of Australia’s mineral and energy resources.
I take this opportunity to recognise the efforts of Chief Minister Henderson in particular and his commitment to this project, to the benefit of the people of the Northern Territory and to Australians more generally.
The Ichthys Project stands to be one of Australia’s largest.
I've heard Seiya Ito san say that in practice the Project is really three projects in one:
- a central processing facility which is likely to be one of the largest ever built;
- a 42-inch gas export pipeline which will be the longest in the Southern Hemisphere; and
- an onshore gas plant in Darwin which, when it comes into production, will be Australia's fifth export LNG facility supplied by conventional gas.
For investors such as INPEX and Total as well as all the Ichthys customers, Australia has many positives – a stable government, transparent and balanced regulation, and a strong economy chief among them.
The impressive scale of the Ichthys Project only enhances the many training opportunities and jobs that it will generate.
I especially welcome the commitment of the Joint Venture Partners to employment for Indigenous Australians.
The Larrakia Trade Training Centre, for example, illustrates how the resources sector must work with Indigenous people to share the benefits and rewards that the resources sector brings to Australia.
Providing opportunities to local businesses through the Northern Territory Industry Capability Network is another example of encouraging industry participation in major resource development.
It’s important that companies such as INPEX and Total recognise the pool of potential talent and skills in our local communities.
Economic modelling by the project suggests more than 3,000 people will be employed in the onshore construction phase, and 700 during operations with additional jobs being created for offshore construction.
Overall, according to the modelling, the project will add 20 per cent to the Northern Territory gross state product.
This will act as a catalyst for further growth.
And with Darwin LNG already in operation, Darwin will be one of the key LNG hubs for Australia.
At the same time, the gas industry is a vital component of energy security for our key trading partners such as Japan and Taiwan, and a pathway for the transition to lower carbon energy generation.
Global demand for energy is growing, particularly from the power economies of China and India – and this demand will continue well into the foreseeable future.
Both demand and supply-side variables indicate we are entering a golden age of gas.
If all the planned projects in Australia are developed, Australia’s LNG production will quadruple within a decade.
Australia is well on track to become the major gas supplier in the Asia-Pacific region – the world’s engine room of economic growth in the 21st Century.
More than anything else the Ichthys project illustrates the world's growing energy interdependence, involving as it does:
- exploiting petroleum reserves off Australia’s North West coast;
- processing that resource some 800 Kilometres away in Darwin;
- suppling long term customers, as well a significant new one, with LNG through long term contracts;
- the very significantly increased participation in Australia’s energy sector by French interests; and
- the addition of a Japanese company to the ranks of the world's LNG plant operators.
Such interdependence, widely understood, is a good thing.
So I’m pleased to see the Ichthys Joint Venture taking this all-important step to development.
Mr Kuroda, Mr Ito, Mr Sangster and all those involved in the Ichthys Joint Venture, I congratulate you all.
Thank you.