The Department of Industry, Science and Resources is investigating if Empire Energy has been given Research & Development grants in preparation for fracking in the Beetaloo Basin. This is contrary to the R&D program’s rules, Kim Wingerei reports.
The R&D grant program is a popular government scheme assisting businesses doing research and development. It covers up to 43.5% of R&D costs incurred in the form of tax rebates. However, it cannot be used for “prospecting, exploring or drilling for minerals.”
Empire Energy, an ASX-listed oil and gas company, has received $28.7M in grants over three years from 2021 to 2023. The company is currently exploring gas wells in the Northern Territory’s Beetaloo Basin, where it hopes to start fracking in the future.
In a Senate Estimates hearing last week, Queensland Greens Senator Penny Allman-Payne queried why “Empire’s financial reports state that it accessed the scheme in relation to drilling and fracking gas exploration and appraisal wells in the Beetaloo [Basin], even though gas exploration is excluded from the R and D tax incentive scheme.”
The department is investigating, while Empire CEO Alex Underwood has stated to the ABC that “the activity in question is not exploration to discover gas, but rather undertaking R&D activities with the purpose to generate new knowledge to determine how that gas can be extracted.” It is not clear what ‘new knowledge’ he was referring to.
Apparently, the R&D grants are not the only funding provided by the Australian Government for the project. In a recent presentation to US investors, Empire boasts of $44M in total government funding or 22% of the $200M spent so far.
Source: Empire Energy
Empire fracking plans
After having explored the area since 2018, Empire is now focused on the ‘Carpentaria Pilot Project’. Empire has said, via a research report funded by Empire, that the first gas will be delivered to market by 2025. The company is yet to have an agreement to sell gas.
Since 2019, Empire has done seismic testing and drilled and test-flowed four exploration wells. Once in production, Empire also wants to profit from the methane gas that the wells emit.
However, gas companies have so far been required to burn off or ‘flare’ methane gas from exploration wells and could not sell and profit from it. Empire is the first company to actively seek to use controversial new provisions enacted by the NT government in late 2022 to sell gas captured from exploration by building new connecting infrastructure to pipe it to the McArthur River mine. This needs the consent/agreement of Traditional Owners and sign-off from the responsible Northern Territory Minister.
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Empire also plans to apply for up to 750ML of water per annum, or 7.5% of the 10GL made available by the NT government for Beetaloo petroleum production in its recent controversial Georgina Wiso Water Allocation Plan.
Empire is currently preparing an Environment Management Plan for the Carpentaria pilot project, which will be put out for four weeks of public consultation and then submitted to the Northern Territory Minister for Environment, Kate Worden, for approval. The approval is expected to take three to four months.
the Minister gives the approval to sell appraisal gas (gas from exploration) under new petroleum laws, Empire Energy must obtain “approval, consent or agreement under the Land Rights Act or the Native Title Act in relation to the sale or other beneficial use of petroleum recovered on an appraisal basis”, ie they must have the agreement of relevant Traditional Owners.
Local opposition to fracking
Empire Energy is not alone in wanting to extract oil through fracking in the Beetaloo. US-based Tamboran Resources are well advanced and recently released their latest plans, also awaiting NT government approval.
The Nurrdalinji Native Title Aboriginal Corporation, which represents native title holders from the Beetaloo Basin, made a submission opposing Tamboran’s latest plans for 15 wells as part of Tamboran’s Environment Management Plan.
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Chair of Nurrdalinji, Djingili elder Samuel Janama Sandy, said, “Traditional Owners do not want Tamboran drilling for gas. We worry about fracking poisoning water and leaving nothing for our grandchildren.
Tamboran have already been fined for pollution and we can’t trust them to look after country.
“Our culture, stories and communities are connected by the waters that flow underground. We can’t afford to risk this just to fill Tamboran’s pockets with cash.”
‘Lock the Gate‘, who has organised communities against fracking since 2010, goes further, stating in a press release this week that “the NT Government has taken greenwashing to the next level since Eva Lawler was sworn in as Chief Minister, following the release of an Orwellian joint press statement with Tamboran chief executive Joel Riddle.”
The new petroleum laws, introduced by the NT government in December 2022, enable companies to begin to sell fossil methane gas from their exploration operations in the Beetaloo, speeding up the ‘monetisation’ of the Beetaloo Basin gas resources. This has been characterised by groups such as the Environment Centre NT as “production by stealth.”
