Santos CEO Signals Shift in Focus from Narrabri to Beetaloo Basin
Following comments made by Santos chief executive Kevin Gallagher during an investor briefing, the company has announced it will not be "exerting any effort" on its Narrabri gas project while awaiting outstanding approvals. This development has raised new questions regarding the future of the contentious project.
Gallagher informed investors this week that Santos is prioritising exploration activities in the Northern Territory’s Beetaloo Basin. He explained that a strategic review led to the decision to "deprioritise" reserves in eastern Queensland and Western Australia’s Browse Basin.
Outstanding Approvals and Opposition to Narrabri Project
The remarks have intensified uncertainty among opponents of the Narrabri project. Although the project secured its primary approvals in 2020, several critical elements remain pending, including a production licence, a pipeline licence, and development approval for a lateral pipeline. This lateral pipeline is intended to connect to a larger Hunter gas pipeline, which has encountered strong resistance from local landowners.
Additionally, the gasfield is subject to a legal challenge from Gomeroi traditional owners under native title laws.
"By holding but delaying Narrabri, Santos is prolonging stress and anguish for communities who have already spent more than a decade defending farmland, water and cultural heritage from this destructive proposal," said Georgina Woods, head of research and investigations for the grassroots anti-mining organisation Lock the Gate.
"Stop stringing everybody along and spike the project finally," Woods added.
"It’s not worth anything to them but it’s worth so much to the community – that forest and that aquifer."
Future Reviews and Strategic Focus
According to company statements, the Narrabri project in north-west New South Wales will be subject to "further review" in 2027 after Santos completes an appraisal of its Beetaloo reserves.
"Narrabri, it’s really about just focusing on approvals and … you know, continue with that, but again, not spending any capital or exerting any effort on that route," Gallagher told investors.
"And some of these [domestic] assets will be re-evaluated once we’ve appraised the Beetaloo, and for obvious reasons.
"If the Beetaloo works, then it changes what we might want to do with some of those assets. There’d be less of a requirement in some cases to do anything with any of them … because the Beetaloo has a scale."
Gallagher further stated that the company believes its acreage in the Beetaloo Basin contains sufficient gas to "supply 10m tonnes of LNG and supply the east-coast market for more than 50 years – it’s a phenomenal resource."
Political Reactions and Government Position
During question time in the New South Wales parliament this week, independent MP Roy Butler questioned Premier Chris Minns about the Santos briefing, which Butler described as "another delay to the Narrabri gas project." Minns has been a strong supporter of the development and previously threatened compulsory land acquisition to facilitate the Hunter gas pipeline.
"Will the government acknowledge that the Narrabri gasfields are smaller than expected and high in carbon dioxide, which is not only contrary to the government’s climate change policies but also makes the gas more expensive to produce?" Butler asked.
Premier Minns responded that this situation "is not necessarily inconsistent with our energy needs in New South Wales."
"It is not necessarily inconsistent with our energy needs in New South Wales," Minns said.
He explained that the state would require approximately 5% of its total energy capacity from "peaking plants," which typically operate only during periods of high electricity demand.
"We will also need gas for our manufacturing industry, and it has to come from somewhere," Minns stated.
"That is completely consistent with the government’s ambitions in relation to net zero and its massive undertakings in renewable energy investment in this state."
In response to inquiries, Minns’ office referred Australia to his parliamentary answer, which did not directly address the investor briefing or the delays to the Narrabri project.
Santos' Statement on Project Approvals
A Santos spokesperson confirmed the company continues to pursue necessary approvals for the Narrabri project.
"A final investment decision cannot be taken until all necessary approvals are in place, including native title, gas production and pipeline licences," the spokesperson said.
