Stonewalled Beetaloo Basin fracking inquiry extended until after elections

May 3, 2022
Opening up the Beetaloo Basin is a part of the so-called gas-fired economic recovery. Photo: Australian government

For a fourth time a Senate committee investigating oil and gas exploration in the Beetaloo Basin in the Northern Territory (NT) has had to ask for an extension.

The Coalition is refusing to shed light on how a $21 million grant, from the Beetaloo Cooperative Drilling Program (BCD), was allocated to oil and gas company Empire Energy which has close ties to the Liberal Party.

The committee’s interim report, published last August, found that three funding grants had been given to Imperial Oil and Gas, a subsidiary of Empire Energy (EE).

EE has close ties to the Minister for Energy and Emissions Reductions, Angus Taylor and the committee found that these close ties may have improperly influenced grant decisions subsequently made by the Minister for Resources and Water Keith Pitt.

Committee chair Greens Senator Sarah Hanson-Young noted in a progress report, published on April 19, that the Greens had pushed for the Senate to disallow the BCD, but were rebuffed by the major parties which voted to retain the $50 million in funding.

BCD was set up in 2020 under Pitt’s watch to provide grants of up to $750,000 to $7.5 million for each well to eligible applicants (with a maximum of three wells). BCD is funded through the Industry and Research Development (Beetaloo Cooperative Drilling Program) Instrument 2021 with the aim of accelerating exploration for oil and gas companies in the Beetaloo Basin.

The committee’s interim report investigated the first of three funding grants – worth up to $21 million – approved for Imperial Oil and Gas.

Since last June year when the Senate set the inquiry up, ministers have been evasive or unwilling to provide answers to questions about how the BCD operates, Hanson-Young said.

The Senate has twice asked for unredacted correspondence between EE and the ministers, but to no avail. Hanson-Young said the ministers’ were “calculated to obstruct the inquiry, hide the nature of the relationship between the government Ministers and donors receiving public money, as well as demonstrating complete disregard for the function of the Senate and the committee”.

A second gas company in possible contempt, the progress report noted, is Sweetpea Petroleum, a subsidiary of Tamboran Resources. It was given $7.5 million by the BCD program and has refused to front the committee despite being summoned to on March 25. It has been referred to the Senate Privileges Committee for possible contempt of parliament and, if found guilty, faces a fine of $25,000.

By not fronting the inquiry, it has not been asked about its joint venture with Santos in the Beetaloo, Sweetpea’s registration in tax-haven Delaware in the United States, and any relationship it might have with the Coalition government.

Greens representatives also queried why a sanctioned Russian billionaire is still being allowed to hold an interest in three petroleum exploration permit areas, via joint venture partners Falcon Oil and Gas and Origin Energy, in the Beetaloo Basin.

Viktor Vekselberg was sanctioned by the US in 2018 and Australia in March, after the war on Ukraine started. He has a 4% financial interest in Origin through his company Lamesa Holdings.

When asked about whether Australia’s sanctions regime had been breached, whether Vekselberg’s shares would rise as exploration moved to production, or whether the government could identify his assets, the Department of Foreign Affairs and Trade was evasive, saying: “There can be very complex business structures that make those things difficult”.

Hanson-Young said reports suggest the Russian oligarch uses shell companies to conceal his assets.

Origin said DFAT affirmed it had not breached Australia’s sanctions law as Vekselberg is not benefitting from any asset “tied to” Beetaloo.

Hanson-Young said the federal and NT governments “appear to be doing whatever it takes to open up this new giant gas field”.

The Coalition committed $1.5 billion in the last budget to new petrochemical infrastructure at Middle Arm in Darwin Harbour which would act as a guaranteed customer for Beetaloo gas.

Two days before the government went into caretaker mode, on April 10, the federal government and the NT Labor government signed the Commonwealth-NT Bilateral Energy and Emissions Reduction Agreement (Bilateral Agreement). The Senate committee sought more information about this agreement but has received very little information.

It is telling that the Labor members of this committee have been at pains to emphasise their concerns over the alleged cronyism but not the underlying issue – opening up the NT to shale gas exploration and production in a climate emergency. Senators Nita Green, Yanyuwa woman Malarndirri McCarthy and Glenn Sterle said the exploration of the basin had “contributed to the economy of the NT through direct and indirect jobs and spending” and they were concerned that the federal government’s failed to provide adequate information would result in an undermining of the “public’s faith in the spending of public money, and ultimately in the process for the exploration of the Beetaloo Basin being undermined.”

In additional comments, McCarthy criticised the companies’ lack of consultation with Traditional Owners, including the Northern Land Council, but affirmed her support for “economic opportunities in the Beetaloo sub-basin”.

Hanson-Young pointed to Emeritus Professor Ian Lowe’s research that the Beetaloo Basin “has the potential to increase Australia’s emissions by up to 13%, with total lifecycle emissions up to double Australia’s entire current emissions”.

“Viewing this in combination with the apparent abandonment of the NT government to require gas companies to offset all lifecycle emissions, this inquiry must continue to scrutinise the roll out of funding and other ‘in kind’ support for the federal and NT governments into the 47th parliament.”

NT Traditional Owners fought for more than a year for the Senate inquiry to be set up because they are opposed to fracking the basin and public money being given to fossil fuel giants. They also travelled hundreds of kilometres to Darwin in April to put their opposition to fracking on the record.

They are not giving up on protecting country.

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