Australia's new shale-basin Beetaloo delivers first gas

The first gas flowed from the Beetaloo Basin in Australia to Darwin, Tuesday. Developers hope that this will show a steady flow of gas and allow for the commercialisation of Australia's first shale-gas venture.

Tamboran Resources, along with its partner Formentera Partners of Texas, delivered gas from the Shenandoah Project, located in the desert more than 600 km away (373 miles), and just an hour drive from Daly Waters, the capital of the Northern Territory.

Early gas flow is expected at 40 terajoules per day (37 million cubic foot) to fuel electricity for the grid. This will give Beetaloo developers a sense of how fast gas depletes from a particular well.

They hope that with this information, they can model a plan of development that will eventually allow the No. 2 LNG producer in the world to increase its liquefied gas export capacity. The world's No. 2 LNG producer could use this information to model a development plan that would eventually fuel higher liquefied natural gas export capacity from the country.

Lia Finocchiaro, Northern Territory Chief Minister, said "it means we have a security of supply" before turning the gas on from a wellhead along with Madeleine King. Madeleine King is the federal government's Resources Minister.

It means that we can start focusing on ensuring our generation poles, and wires business runs as efficiently as possible to ensure costs do not continue to rise.

The project is facing many obstacles, including the need for billions in pipeline capacity and political challenges such as Australia's new policy requiring that data centres be powered primarily by renewable energy.

Tamboran's CEO Todd Abbott is a veteran in the U.S. Shale industry. He said that the company would first focus on sending gas to Darwin. Then, it will work out "some technical issues and regulatory matters" before expanding.

Since the lifting of a moratorium eight years ago, smaller firms supported by U.S. players have been drilling.

Inpex, a Japanese company, recently acquired a large area of land in Formentera. Analysts see this as a positive development because it could give the island access to capital for a wide-scale expansion.

In a press release, Samantha McCulloch (CEO of Australian Energy Producers, a lobby group that also attended the event) said: "The opportunity is now to build on this momentum and to attract the necessary investment to unlock the full potential economic and energy security of the Beetaloo."

(source: Reuters)