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The Guardian - AU
The Guardian - AU
Lisa Cox

Darwin’s ‘sustainable’ Middle Arm development is key to huge fossil fuel projects, documents show

A ship, the Maran Gas Sparta, sits at the wharf at the Darwin LNG gas processing facility on Middle Arm
The NT’s Middle Arm project has been described in government briefings as a gas production and export hub, despite being labelled a ‘sustainable development precinct’. Photograph: Mike Bowers/The Guardian

The proposed Middle Arm industrial development on Darwin harbour, in which the Albanese government is taking a $1.5bn stake, is “seen as a key enabler” for the export of gas from the Beetaloo basin, according to a federal government document released under freedom of information.

This is despite the project being labelled a “sustainable development precinct”.

The minister for infrastructure, Catherine King, has previously said the federal government’s investment in Middle Arm is “not a subsidy for fossil fuels” but rather “an important way of setting up our economy for a sustainable future”.

The federal funding would go towards infrastructure that would help Australia meet its “commitment to net zero”, King said in response to questions in parliament from the independent member for Kooyong, Monique Ryan, in October.

But the document, a background briefing that officials in the environment department sent to the office of the environment minister, Tanya Plibersek, in July, described the Middle Arm project as central to the expansion of gas production in the Northern Territory’s Beetaloo basin as well as to the “feasibility” of proposed offshore carbon capture and storage, which could be associated with projects such as the Barossa offshore gas field and pipeline.

“Middle Arm precinct is seen as a key enabler for Beetaloo gas to be transported north, further benefitting the Northern Territory’s economy,” the briefing states.

A storm builds over the Ichthys onshore gas processing facility on Middle Arm in Darwin Harbour
Both the NT and federal governments have consistently described the Middle Arm project as a sustainable development precinct. Photograph: Mike Bowers/The Guardian

The precinct would “support a hub for activities such as gas production, minerals processing, hydrogen production and exporting gas,” it says.

The document is the first to be released showing the Albanese government was briefed on Middle Arm’s links to new fossil fuel developments. Earlier documents reported by the ABC show the Northern Territory government described the project as a “new gas demand centre” in its original 2020 pitch to Infrastructure Australia.

It has prompted calls from the Greens and the crossbench for the Albanese government to drop its financial support for the project.

“Previous documents have shown a link between Middle Arm and fossil fuels,” said the independent senator David Pocock. “These documents put it beyond doubt that the facility is intended to enable the development of huge gas projects.”

The document was released to Guardian Australia under freedom of information laws as part of an investigation into the expansion of the gas industry in the Northern Territory.

That expansion includes hydraulic fracturing – or fracking – for gas at the Beetaloo basin, which scientists have warned will have an unacceptable impact on the climate, and Santos’ proposed Barossa offshore gas development, which is fiercely opposed by traditional owners on the Tiwi Islands.

Middle Arm on the right of the Elizabeth river near Darwin in the Northern Territory
Greens leader Adam Bandt has described Labor’s treatment of the Middle Arm precinct as ‘greenwashing’. Photograph: Mike Bowers/The Guardian

This month the NT chief minister, Natasha Fyles, gave the green light for production to begin in the basin, a region between Katherine and Tennant Creek that contains vast reserves of shale gas.

Middle Arm will be a major manufacturing hub for gas, petrochemicals, hydrogen and minerals. Plans show the project would house new gas, blue and green hydrogen and minerals facilities, and carbon capture and storage. Both the NT and federal governments have consistently described the development as a sustainable development precinct.

But the Greens leader, Adam Bandt, has labelled it greenwashing: “These secret documents show Labor is greenwashing Middle Arm’s true role as a methane gas export hub. Labor wants to open new gas projects, paid for by the public.

“The Middle Arm precinct is designed to allow the Beetaloo to become commercially viable through allowing the export of massive quantities of methane gas to Asia, fuelling the climate crisis and slowing the transition towards hydrogen and renewables.”

The briefing also notes that potential offshore carbon storage sites and options for CO2 pipeline corridors had been identified around the Middle Arm precinct.

“The concentrated sources of CO2 from industrial processes at Middle Arm will improve the feasibility of carbon capture and storage,” it says. “This would support the social licence of the Beetaloo Basin gas extraction and help meet NT commitments to not increase emissions.”

Pocock said Australia could not afford new gas projects if it wanted to protect people and places from climate change.

“The description in the documents released under FoI describing Middle Arm as a facility that would support the social licence for gas extraction in Beetaloo basin is deeply concerning,” he said.

“If the Labor government is serious about climate action, it should reconsider the decision to give a $1.5bn fossil fuel subsidy to a coalition project that enables gas extraction.”

A ship, the Maran Gas Sparta, sits at the wharf at the Darwin LNG gas processing facility on Middle Arm
The federal government has said projects like Middle Arm ‘are an important way of setting up our economy for a sustainable future’. Photograph: Mike Bowers/The Guardian

Ryan said the development was a test for the government. “Labor can either follow Scott Morrison’s lead with a ‘gas-led recovery’, or listen to the experts who say we cannot approve any new coal or gas projects if we are to keep global warming under 1.5 degrees,” she said.

“These new documents say what Labor has been trying to hide: they actually appear quite happy with the core thesis of Scott Morrison’s ‘gas-led recovery’.”

A spokesperson for the acting infrastructure minister, Murray Watt, said the government’s planned equity investment was for marine infrastructure such as specialist product wharves, modular offloading facilities for manufacturing and dredging of the shipping channel.

“The global energy market has progressed significantly over recent years with a shift towards developing green hydrogen and renewable power,” the spokesperson said. The government’s investment in Middle Arm “will help the Northern Territory and northern Australia to capitalise on the energy transition and unlock new market opportunities for a range of sustainable industries”.

This included “green hydrogen and renewable storage, as well as advanced manufacturing, critical minerals processing and the manufacture and export of lithium batteries that are critical to global energy transition and decarbonisation, and other land uses”.

The spokesperson added that Infrastructure Australia had identified common use infrastructure at the Middle Arm precinct as a national priority, having assessed the Northern Territory government’s early business case.

“The Australian government believes investing in projects such as the Middle Arm precinct are an important way of setting up our economy for a sustainable future and ensuring Australia harnesses the opportunities which come with a transition to net zero.”

A spokesperson for the Northern Territory government said the government was “turning Middle Arm into a development-ready location for investment – especially in the industries of renewables, low-emission energy and fuels, advanced manufacturing and low emissions minerals processing”.

“While proponents for the precinct are still being worked through, we have already received significant interest from these industries.”

The spokesperson said sustainable outcomes and environmental protection were central to precinct planning.

“The Middle Arm project will also implement circular economy principles. A circular economy is about changing the way products are produced, sold and used to minimise and potentially reuse waste streams, reducing overall impact on the environment.”

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