(EnergyAsia, June 18, Wednesday) --- The following is an excerpt of the interview conducted by Australian conference organiser IIR. Mr Henderson will open the South East Asia Australia Offshore Conference (SEAOOC) in Darwin, Australia on July 16 to 18. The interview can be viewed at http://www.youtube.com/watch?v=IV8klXD6-_E.

1. With crude oil passing $130 a barrel, natural gas a cheap alternative energy source is a hot topic these days. This must be good news for Darwin which you’re pushing as a liquid natural gas hub.

Henderson:   I wouldn’t say it’s good news for the Northern Territory. We’re the furthest removed capital city from the rest of Australia so high oil prices do affect our economy. But in terms of developing oil and gas fields in the Timor Sea and the Bonaparte Gulf in the region, yes it is very interesting and exciting times for the Northern Territory.
The (Inpex) Ichthys field has just be re-evaluated to have 500 million barrels of condensate along with 13 trillion cubic feet of gas, so getting these types of projects to Darwin is very important to my government and that’s why we’re going after the Inpex project as hard as we possibly can.

2. You already have one plant processing Timor Sea gas for export. How important is gas processing to the Northern Territory Economy?

Henderson:   It’s very important to our economy because as well as the capital investment and the ongoing jobs that the Wickham Point LNG project has created, it really sparks significant confidence in the Northern Territory’s and Darwin’s economy, and led to investment in a number of other economic sectors, so as well as a direct benefit to the economy it also generates confidence for other sectors to invest in and again that’s why we’re going after our second LNG plant as hard as we can.

3. Why Darwin? What advantages does Darwin have over other Australian centres as a liquid natural gas hub?

Henderson:   We’re gas ready. We have the only gas-ready site in the whole of northern Australia at Middle Arm. Our proximity to countries to our north, to China, to India, to Japan means that the Northern Territory is really the only site in northern Australia that investors can come to tomorrow. We have a site, we’re a capital city; we have a capital city infrastructure; and we’ve already delivered one project on time and on budget and I’m confident we can deliver more.

4. What initiatives are you taking to excite more interest in Darwin as a gas processing centre? And what’s been the response?

Henderson:   We’ve been very actively chasing the major LNG companies who are looking to develop LNG projects in Australia. We have a one-stop-shop within the Chief Minister’s Department of major projects that companies can deal with so they don’t have the run around of government agencies and we’re a ‘can-do’ government, so all of those things mean that there is a lot of interest in doing business in the NT.
Darwin LNG, ConocoPhillips have approvals to go from three million tonnes per annum production to 10 million tonnes. We’re obviously talking very closely with Woodside and would like to see Sunrise brought on shore to Darwin as well as chasing Inpex as hard as we possibly can to see their project brought to Darwin so…a ‘can-do’ government, a gas-ready site, we’re open for business and we’re promoting Darwin as a place to invest.

5. Some sections of the LNG industry say the export bubble could burst if investors are forced to comply with an emissions trading scheme and are calling for exemptions for new investment in big emitting export industries. Can you understand their view and what’s your position?

Henderson:   Climate change is certainly one of the most important environmental and economic challenges facing Australia and the world. That’s why we’ve got to get the science right and we’ve got to get the economics right. At the moment we’re undergoing community and public consultation in the Northern Territory to develop our own climate change policy.
Obviously that has to sit with the Australian Government policy but as Chief Minister I’m determined to see the economics of any decisions being in the best interests of Australia and the Northern Territory as well as getting the best environmental outcomes and that policy work is being done at the moment.

6. Given the advantages of natural gas – it’s abundant and cheap, has less greenhouse emissions than coal and oil, and the technology is proven – do you see its use one day extended widely to motor vehicles? Motorists are fed up with escalating gasoline prices.

Henderson:   Again, in terms of Australia’s energy market, we have a deregulated energy market and certainly the economics are going to drive decisions about what technology we’re going to invest in in the future, and that would be the same with motor vehicles. If the economics are right to run motor vehicles on gas as opposed to hydrocarbons and petrochemicals then obviously that’s going to be the path that industry goes down and of course if there’s better environmental outcomes that can only be a benefit as well.

7. Do you see the NT benefiting from a bigger national takeup of LNG?

Henderson:   I think again we have to take a good long look at Australia’s energy needs into the future. Certainly it’s an exciting time for the NT.
I’ve just come back from a major visit to Japan and China, and in China certainly where 80% of China’s electricity production is from dirty coal from Anwei province, they’re looking at more nuclear power, more LNG-produced electricity and that can only benefit the NT’s economy and certainly in Australia, most of our power generation is coal-fired, unless they get clean coal right, unless they get carbon sequestration right, I think LNG will be a very viable option for Australia into the future.

8. The NT government is an event partner for SEAAOC, the annual offshore oil and gas forum in Darwin in July. What’s your message for delegates?

Henderson:   My message to delegates would be that my government has a vision for Darwin to be the oil and gas service and supply industry hub for northern Australia and to the region. We’re also a site that is gas ready for further LNG developments; the Northern Territory is open for business; and we’re a ‘can-do’ government that will provide a one-stop shop to facilitate it. I look forward to meeting with delegates in July and certainly promoting to those delegates we’re open for business.