Will small-scale extraction of onshore gas deliver 6500 jobs and a $2.8 billion economic boost for the Northern Territory?

The Statement

"The NT's independent inquiry found that even small-scale developments in the Beetaloo could create more than 6500 full-time jobs and positive economic impacts of up to $2.8 billion for the Northern Territory and over $9 billion for Australia as a whole over 25 years."

Kathy Ganley, the Country Liberal Party candidate for the Northern Territory seat of Solomon, claims fracking (the system used to extract oil and gas from subterranean rock) will greatly benefit the territory's economy. April 17, 2019.

The Verdict

Mostly True - Mostly accurate, but there is a minor error or problem.

The Analysis

AAP FactCheck examined Ms Ganley's claim that small-scale fracking in the NT's Beetaloo Basin would create more than 6500 full-time jobs and deliver economic impact over 25 years of up to $2.8 billion for the territory, plus over $9 billion for the nation. [1]

AAP FactCheck found Ms Ganley's claim to be true.

Federal Resources and Northern Australia Minister Matt Canavan was in Darwin on April 17 to publicise an April 2 federal budget announcement of $8.4 million in funding to fast-track development of gas reserves in the Northern Territory's Beetaloo Basin.

"We want to get on with the job. We want to get the gas up out of the ground and into people's homes and businesses as quickly as we can," Senator Canavan said in a statement. [2]

Kathy Ganley, the Country Liberal Party candidate for the NT seat of Solomon, joined Senator Canavan in Darwin and said that the NT would greatly benefit from even small-scale development of the Beetaloo Basin. Solomon is one of two federal seats in the Northern Territory. It's held by Labor's Luke Gosling with a margin of 6.1 per cent. [1]

The Beetaloo Basin is about 500km south-east of Darwin in the Sturt Plateau region between the towns of Katherine and Elliott and includes pastoral land and indigenous communities. Around 70 per cent of the Territory's shale gas resources are estimated to lie in the Beetaloo Basin, reserves that could potentially raise Australia's global ranking of gas resources from seventh to sixth. Farmers, businesses and industry are divided over whether fracking should be permitted because of the risk of pollution to rivers and bores. Pro-fracking advocates argue it will be a boon for jobs and economic growth. [3]

The $8.4 million federal budget pledge to fast-track development of the NT's gas reserves received little publicity and surprised anti-fracking groups when it was announced in the April 2 budget. [4]

The NT had a moratorium on fracking or hydraulic fracturing pending an independent inquiry into the gas extraction. [5]

AAP FactCheck asked the Country Liberal Party for the source of Ms Ganley's jobs and growth figures and was directed to the 2018 Scientific Inquiry into Hydraulic Fracturing in the Northern Territory final report.

The report was conducted by Justice Rachel Pepper and a panel of scientists who took 15 months and made 135 recommendations. Justice Pepper stated the report was "truly independent" of government. [6]

The Pepper report concluded the challenges and risks associated with any onshore shale gas industry in the NT could be "appropriately managed". [3]

The Pepper report was required to determine the economic risks and impacts of hydraulic fracturing in the NT and engaged economic consultants ACIL Allen Consulting Pty Ltd (ACIL Allen), to compile an assessment contained in the Pepper report, titled The Economic Impacts of a Potential Shale Gas Development in the Northern Territory. [7]

The ACIL Allen assessment divided the economic impact of any onshore shale gas development into four scenarios based on whether or not the moratorium was lifted and how much exploration was permitted.

The figures quoted by Ms Ganley came from the middle-range scenario whereby the moratorium is lifted and "moderate-scale development" occurs with the majority of gas sold into the east coast market aided by additional gas pipeline infrastructure. [8]

The exact same jobs and economic figures were published in a media report about the $8.4 million pledge immediately following the federal budget. "The money would also help the Territory meet some of the 135 recommendations from the Pepper report to help launch the basin as a prospective gas field," the report said. [9]

The assessment supports Ms Ganley's claim of more than 6500 full-time jobs and an economic impact over 25 years of up to $2.8 billion for the Northern Territory and over $9 billion for Australia. However, these figures come from the middle-range scenario with moderate-scale development, not "small scale" as Ms Ganley stated. [8]

The Verdict

Mostly True - Mostly accurate, but there is a minor error or problem.

The References

1.'Funding to fast-track fracking in Beetaloo Basin is focus of $8.4 million Federal Government pledge', by Kieran Banks. NT News. April 17, 2019:

https://www.ntnews.com.au/business/funding-to-fasttrack-fracking-in-beetaloo-basin-is-focus-of-84-million-federal-government-pledge/news-story/93d55c2a57304502f396b5bc72564958

2. 'Beetaloo Basin Announcement', by Lauren Roberts. NT News. April 17, 2019:

https://www.ntnews.com.au/news/rush-hour-84mil-fracking-cash-to-fasttrack-beetaloo-basin/live-coverage/6e032bb79acb90da4be2589a178bab8c

3. 'Beetaloo Basin: What do we know about the region at the heart of the NT fracking debate?', by Bridget Judd. ABC. Apr 17, 2018: https://www.abc.net.au/news/2018-04-15/beetaloo-basin-at-the-heart-of-the-nt-fracking-gas-debate/9652390

4. 'Fast track for fracking with surprise Federal Budget cash splash', by Chris McLennan. Katherine Times. April 3, 2019: https://www.katherinetimes.com.au/story/5990542/surprise-budget-cash-to-accelerate-shale-gas-development-in-the-nt/

5. 'NT fracking inquiry: More than 500 jobs and up to $5.8b predicted by economic assessment', by Lucy Marks. ABC. October 27, 2017: https://www.abc.net.au/news/2017-10-27/nt-fracking-economic-report-predicts-13000-jobs/9094998

6. 'Scientific Inquiry into Hydraulic Fracturing in the Northern Territory. Final Report'. (Page 3)

April 2018: https://frackinginquiry.nt.gov.au/inquiry-reports?a=494286

7. 'Scientific Inquiry into Hydraulic Fracturing in the Northern Territory. Final Report'. (Page 347) April 2018: https://frackinginquiry.nt.gov.au/inquiry-reports?a=494286

8. 'Scientific Inquiry into Hydraulic Fracturing in the Northern Territory. Final Report'. (Pages 348, 351 and 353 Table 13.2 Wind) April 2018: https://frackinginquiry.nt.gov.au/inquiry-reports?a=494286

9. 'Taxpayers' money to fast-track Origin's shale gas project' by John Durie. The Australian. April 3, 2019:

https://www.theaustralian.com.au/commentary/taxpayers-money-to-fasttrack-origins-shale-gas-project/news-story/88663e053bfd289e90500ee51227f1cc

Australian Associated Press