Former Western Australian Premier Colin Barnett’s call for a “nation building” coast-to-coast gas pipeline traversing longitudinal across Australia has received a vote of no-confidence from industry experts as a cure-all solution to Australia’s energy crisis ills.
Australia Prime Minister Malcolm Turnbull has given the gas shortage in the eastern states priority as he endeavors to halt a runway train threatening to impact industry and the country’s economy within 12 to 18 months.
Barnett, who lost the March State election in Western Australia, but is still a Member of Parliament for Cottesloe, emerged from a short hiatus last week to state his case for construction of a pipeline of approximately 4,030 km (2,500 miles) from the gas-rich North West Shelf supplying Victoria (Melbourne) and New South Wales (Sydney) markets.
Barnett said it was “ludicrous” that a gas shortage on the East Coast could be supplied by a “world-class resource” in the west “and we are not using it for Australia.”
“We should be looking at transporting that gas across country, as happens in Europe, North America and Russia. There is nothing secret and difficult about building a gas pipeline.”
Barnett said it defied logic that Australia would potentially emerge as the world’s biggest exporter of LNG by the end of the decade, while gas prices were spiking in the eastern states as industry contemplated a withdrawal over long-term supply shortages.
“From outside Australia, it just looks stupid. We have this massive resource the rest of the world is buying and we are not using it ourselves,” Barnett said.
EnergyQuest Managing Director Graeme Bethune, however, said shipping LNG to the East Coast would be a far cheaper, more flexible and practical option than a pipeline, even if this meant Australia having to import gas cargoes from abroad.
He said it would be far more economical to convert vessels to floating regasification import terminals stationed off the coast of Victoria and—as the clock ticks—this option could be accomplished far quicker than a pipeline.
“The way these things evolve in other countries enduring a short-term gas shortage is you start importing from the closest place it is produced; in this instance Western Australia, Indonesia or Papua New Guinea,” Bethune said.
Steve Davies, Australian Pipelines and Gas Association national policy manager, echoed Bethune’s views, saying prohibitive costs, challenging terrain and economies of scale were loaded against the east-west pipeline.
“In Europe, they move huge volumes of gas. Some of the 46-in pipelines out of Russia carry 1,000 petajoules a year, which is a completely different magnitude to what we are dealing with as we would need to supply a projected shortfall of 50 to 60 petajoules, or 200 terajoules a day,” Davies said.
With construction soon to commence on the 622-km (411-mile) Northern Gas Pipeline (NGP) from Tennant Creek in the Northern Territory to Mount Isa in Queensland, at a cost of AU$662 million (US$973 million), Davies conservatively estimated that an east-west pipeline would easily cost AU$3 billion (US$3.96 billion), but he “couldn’t see it being built in four years.”
He said that unlike the U.S., featuring a web of pipelines that gas producers were able to tie into to supply a population of 320 million people spread across the country, 70% of Australia’s 23 million people were located in and around five coastal cities; Brisbane, Sydney, Melbourne, Adelaide and Perth.
“The NGP is about one-third the distance of an east-west pipeline which would be a huge project which would likely face huge variations in constructability, availability of gravel and a lack of rail and road links to assist transportation,” he added.