Brian O'Gallagher - Asian Engagement and Economic Opportunities for the Northern Territory

DEPARTMENT OF THE CHIEF MINISTER www.investnt.com.au

Asian Engagement and Economic Opportunities for the Northern Territory

Presentation to:

Katherine Regional Mining & Exploration Forum

Brian O’Gallagher

28 May 2014


Proximity to Asia


North Australian and Asian Century

Asia by 2030

• Asia’s middle class grows by 600%

• 3.2 billion middle-class Asians, equal to five times the population of Europe and US combined

Northern Territory and the five “Fs”

Food - Agribusiness

Fuel - Energy

Fun - Tourism

Frontline - Defence & Trade

Foreign investment - Growth


The Northern Territory and its Regions

Total NT

• 234,836 population

• 125,607 labour force

• 4.0% unemployment

• 13,807 businesses

• 1,348,199 km2 in area

Daly, Tiwis & West Arnhem

• 18,382 population - 8%

• 6,422 labour force – 5%


• 1,463 businesses – 11%

• 112,251km2 in area – 8%

Alice Springs region

• 41,222 population -18%

• 23,075 labour force - 18%


• 1,929 businesses - 14%

• 569,566 km2 in area – 41%

East Arnhem

• 16,178 population – 7%



• 214 businesses - 2%

• 33,596 km2 in area – 2%

Katherine

• 20,694 population – 8%



• 804 businesses – 6%

• 326,327km2 in area – 24%

Barkly

• 6,682 population - 3%



• 192 businesses -1%

• 303,295 km2 in area – 22%

Greater Darwin

• 131,678 population – 56%



• 9,205 businesses – 66%

• 3,164 km2 in area – 0%

DATA

• Population - 2012 data from ABS

• Labour force - Dec 2012 data

• Unemployment - Dec 2012 data

• Business count – 2009 data ABS


• Priority Sectors and Markets

− Including Supply and Service Sector

• Recognises Primacy of the Private Sector

• Initiatives to convert potential into projects

• Recognises the importance of our Regions

• Consultation Phase about to commence

Northern Territory - Draft Asian Engagement, Trade and Investment Strategy


Growing International Trade & Investment

Priority Markets Emerging Markets

– Japan

– China

– Indonesia

– Korea

– Vietnam

– Timor Leste

– Philippines

– Thailand

– Singapore

– Malaysia

– Other (incl. USA, Europe, India)

– Energy Resources

– Minerals

– Tourism

– Agribusiness

– International Education & Training

– Supply and Service

– Infrastructure and Property

Priority Trade & Investment Sectors


2012 2013 2014 20152011 2016 2017 2018 2019 2020

Defence &

Domestic

Infrastructure

& Ports

Onshore

Mining

Onshore Oil

& Gas

Offshore Oil

& GasINPEX/ Ichthys

offshore$17B

INPEX/ Ichthysonshore

First 2 trains$17B

New PrisonNTG/ Sitzler

$600m

Single LEAP

Defence$230m

Airport expansion

$60m

Mt ToddVista Gold

$1B

Crux FLNGNexus

Energy/ Shell

Bigrlyi Energy Metals$181m

WonarahPhosphate

MinemakersLimited $200m

Sunrise FieldWoodside

Potentially FLNG$12B

Darwin LNG 2nd train ConocoPhillips

$5B

Cash Maple FLNG PTTEPAA

DEFENCEforce posture review

Prelude FLNGSHELL$12.6B

US Marines

Freight from

Roxby Downs,

Olympic Dam

$936m over

24 years

MontaraFLNG

PTTEPAA$440m

HeronGas Field

LNGMEO

BlackwoodGas Field

LNGMEO

Mt Peake Vanadium

TNG$700M

Redbank Oxides Copper

Ord River Irrigation Area Stages 2 & 3

Beetaloo Basin Origin Energy/ Falcon/Sasol

Southern Georgina Shale

GasPetrofrontier

Ranger Uranium Exploration ERA

$120m

Callie Deeps

Newmont Gold

Australia

Western Desert Resources

$160m

Larrakeyah

Base

Defence

$50m NPARIH Territory Housing$672MFibre network

Construction NBN – SA/NT

$341m

Groote Eylandt portexpansion

GEMCO$279m

McArthurRiver

Xstrata Zinc

$350m

Darwin Port

upgrade

DPC

$41M

Waterfront Redevelopment stage 2 - Toga

$63m

Marine Supply Base NTG

$110m

Casuarina Square

expansionMYER$220m

Palmerston Hospital

NTG$110m

Darwin

Port

upgrade

DPC $85M

Sherwin Iron Hodgson Downs$180m

Nolans Rare Earths

Arafura$345m

McArthur Basin Shale Gas

Armour Energy $50M

Ranger

Uranium

Expansion ERA

Molyhil

Thor

Mining

$66m

A Steady Pipeline of Major Projects & Investments

Under evaluation

Confirmed project

Prospective

Bonaparte FLNGGDF/ Suez/

Santos

Chandler Salt Mine

$200m construction

Abattoir

AAco

$100m

Southern

Georgina Basin

Shale exploration

Petrofrontier

$210m

JSF TindalRAAF Base

Katherine Region

Australian Ilmenite


Strong International Engagement


Growth and Investment Opportunities


Darwin – a Northern Oil and Gas Hub

• Deep water harbour

• Marine supply base

• Common user area

• East Arm logistics precinct

• International port

• Trans-continental railway

• National highway

• International airport

• Petroleum supply and service centre

• CDU North Australian Centre for Oil & Gas


Prelude FLNG

• Operations to be serviced from Darwin’s Marine Supply Base

• FID announced 20 May 2011

• LNG production of 3.6Mpta for 25 years

• Samsung building the 600,000 tonne 488m x 74m wide FLNG vessel

Darwin the Northern Gas HubDemonstrated Industry Confidence


Future Supply Centre for Floating LNG

1. Prelude (construction underway)

2. Sunrise

3. Abadi

4. Petrel/Tern/Frigate

5. Oliver/Cash/Maple/ Montara

6. Caldita/Barossa

7. Evans Shoal

8. Heron/Blackwood

9. Chuditch

10. Poseidon

11. Crux/Libra

12. Argus


Growing Foreign Investment in Onshore Gas Developments

• Armour Energy Pty LtdSeismic – McArthur Basin

• Falcon Oil and Gas Australia Pty LtdExploration well & seismic – Beetaloo Basin

• Central Petroleum / SantosExploration well & seismic – Amadeus & Eromanga Basins

• Central Petroleum / TotalSouthern Georgina

• PetroFrontier / StatOilExploration well & seismic – Georgina Basin

• Santos Ltd / Magellan Petroleum (NT) Pty LtdOil and Gas production – Palm Valley / Mereenie

* Estimates have been derived from company reports and geological survey information (bstb = billion stock tank barrels)

Estimated basin reserves

40 TCF Gas


64 TCF Gas; 18 bstb oil


25 TCF Gas; 1 bstb oil


372 bstb oil


Infrastructure

• Development of a second port / industrial site

mineral and energy exports and new petrochemical industry

• Expansion of the transport and freight corridor

new rail and road links across Australia

• Increased shipping and air links to Asia

• Connecting pipelines to national gas grid


New Strategic Infrastructure to Unlock Economic Value

Rail:

Existing

Potential

Two new

potential

rail links

Pipelines:

Existing

Committed

Proposed

Two new

potential

pipeline

links

Second port?


Agricultural Opportunities

Potential supplier ofhigh quality, high value produce to markets in Asia

Plentiful water supplyand 1/6 of Australia’s land mass

Opportunities exist in:

• vegetables

• mangoes

• bananas

• melons

• grapes

• dates and nuts

• dragon fruit



Pastoral

Changes to the Pastoral Land Act

= diversification of pastoral leases

Pastoral industry valued at $280m, with extensive cattle grazing operations

There are 224 pastoral leases and 2 million cattle in NT

500,000 cattle for sale each year 50% for live export



• 10% of Australia’s ADF combat personnel in the Territory

• Over 14,000 Defence personnel and families

• Up to 2,500 US Marines by 2018-19

• Over $1.4 Billion pa

• Military Exercises – Pitch Black $25 Million (July 2014)

• High tech defence platforms, inc. JSF

• Grow local capability in unison with defence growth

Defence Support


Tourism

• Tourism is worth $1.5bn to the economy

• Expected to grow to $2.2bn by the end of the decade – with a large part of the growth coming from Asia

• Strong appeal from both domestic & international tourists for natural destinations

• Increasing demand for tourism accommodation


Local Industry Development & Investment

• Industry and Government are working collaboratively to leverage the maximum benefits from petroleum and mining projects

– Industry Participation Plans

– Industry Capability Network NT

– Investment in Training and Development


Investment Summary

The Northern Territory is ideally positioned and resourced to share in the wealth creation in the region and act as a gateway between Australia and Asia.


xxxxxx