Tamboran Says it’s Business as Usual in the Betaloo in Spite of Shifting Political Sands

Tamboran Resources says the Safeguard Mechanism reforms passed by the Federal Parliament are generally in line with recommendations made under the independent Scientific Inquiry into Hydraulic Fracturing of Onshore Unconventional Reservoirs in the Northern Territory (the Pepper Inquiry).

The Sydney-headquartered gas player cited recommendation 9.8 of the Pepper Inquiry stateing that developing the Beetaloo should have “no net increase in the life cycle GHG emissions emitted in Australia”.

Tamboran said it believes the Beetaloo Basin’s low reservoir CO₂ is an attractive source of supply for industry seeking to reduce greenhouse gas (GHG) emissions. This includes displacement of higher emitting sources of energy (i.e. coal-fired power and higher reservoir CO₂  fields) and important feedstock for the manufacturing industry.

“In a decarbonising economy, low reservoir CO₂ natural gas produced by a company with Net Zero Scope 1 and 2 targets should be prioritised for development,” the company said in a release to the ASX.

Tamboran is already targeting Net Zero Scope 1 and 2 equity emissions from the commencement of commercial production, which will incorporate electrification of facilities and equipment, including Helmerich and Payne’s (H&P) super-spec FlexRig®, which is enroute to Darwin.

Operations in Tamboran’s Beetaloo Basin assets are continuing as planned, with the Amungee 2H (A2H) well in exploration permit EP 98 currently flowing back stimulation fluid.

The 30-day initial production rates from the A2H well are expected to be announced during the second quarter of 2023.

Tamboran Resources Limited Managing Director and CEO, Joel Riddle, said: “The benefit of Beetaloo Basin gas is that low reservoir CO₂ will provide an attractive source of energy in Australia’s Northern Territory and East Coast markets as coal-fired power stations are decommissioned and gas-fired power is used to complement the uptake of renewable energy.

“Beetaloo gas also has the potential as a low CO₂  source of gas supply for the manufacturing industry, which consumes approximately 45 per cent of gas sold to the domestic market and employs approximately 225,000 people in Australia. Gas is a key input in the manufacturing of fertilisers, glass, cement and bricks.

“As the existing East Coast gas supply falls from the Gippsland Basin and Cooper Basin, Beetaloo gas is expected to be a key supply source in meeting the anticipated shortfall forecast by the Australian Competition and Consumer Commission (ACCC) and Australian Energy Market Operator (AEMO).”

Recommendation 9.8 of the Pepper Inquiry

The Pepper Inquiry recommendation specifies that one way to fulfill Recommendation 9.8 is for the Federal Government to “strengthen existing policies and/or the introduction of new policies and initiatives to meet Australia’s international obligations.” The recommendation goes on to say, “there are a variety of strategies that may either be expanded or new strategies be implemented to achieve this recommendation, including: early retirement of coal-burning powerplants; fitting of carbon capture and storage to gas or coal-fired power stations; higher emission standards for fossil fuel-burning vehicles; increased uptake of electric vehicles; international offsets; carbon credit offsets in agriculture and savannah burning; formal offset policies and markets; increased deployment of renewable energy; and reductions in deforestation.”

Tamboran Resources’ pure focus is on its acreage portfolio in the Beetaloo/McArthur Basin in the Northern Territory, where it holds the largest acreage holder in the Beetaloo Basin with ~1.9 million net prospective acres, held through 100% owned properties and two joint ventures – one with Santos and the other with Falcon Oil & Gas and Daly Waters Energy LP (Sheffield).

Through these interests, the Company holds net 2C contingent resources of ~1.5 trillion cubic feet (TCF).

The Tamboran/Sheffield 50:50 JV has entered into a binding 10-year Gas Sales Agreement (GSA) for up to 36.5 PJ per annum (18.3 PJ per annum net to Tamboran) with Origin, Australia’s leading energy retailer.

The Beetaloo Basin is proximal to a major industrial hub which enables relative logistical and operational luxuries, like close access to key infrastructure through roads, a pipeline and a railway.

Its location means efficient access to Australian markets and beyond, with the northern port city of Darwin and the Eastern Seaboard of Australia to the east through Queensland.

In June 2022, the Company executed an MOU with gas pipeline operator, Jemena, to enable Tamboran to contract ~100 TJ per day of firm capacity through the Northern Gas Pipeline (NGP), subject to applying NGP Access Principles, under a long-term gas transportation agreement.