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NT set to announce Gove gas supply decision
By Lauren Day

Updated 3 minutes ago

The Northern Territory Government is expected to announce on Monday if it will approve mining giant Rio Tinto's bid to secure a 10-year supply of gas to power its alumina refinery at Gove.

Chief Minister Terry Mills is returning from Europe where he has been meeting with executives from Rio Tinto and others in the mining and gas sectors.

He will brief his Cabinet before any announcement is made.

Federal Resources Minister Martin Ferguson says Mr Mills should stop worrying about future gas reserves and meet the demands to save the Gove refinery.

Mr Mills says it is too risky to give up 10 years of the Territory's domestic gas supply to the operation without securing an assured future replacement supply.

Rio Tinto is considering closing the refinery, operated by subsidiary Pacific Aluminium, if it cannot get gas to power it more cheaply, a move that would cost more than 1,000 jobs.

It could also threaten the future of the Arnhem Land town of Nhulunbuy, where the population could be more than halved to less than 2,000 people.

Rio Tinto also wants the Commonwealth to underwrite the $800 million cost of building a pipeline stretching more than 1,000 kilometres from Wadeye, east of Darwin, to Gove.

Mr Ferguson told Parliament this week that Mr Mills must "think very seriously about making the necessary gas available".

"This is a decision that must be made," he said.

"Once made, then we will be able to move the next process of consideration of whether we can assist in underwriting the construction of the pipeline.

"It's good for the Northern Territory and it's good for Australia.

"I simply say to the Chief Minister: 'You have our support in making this decision'.

"We will not have a shortage of gas in the years to come."

Analysts estimate Rio Tinto is losing about $30 million a month by operating the Gove refinery using expensive diesel fuel.

Acting Chief Minister Robyn Lambley says providing the gas without any guarantees could risk the Territory's domestic electricity supply and cost Territorians.

"I would ask Martin Ferguson to provide a guarantee and to make sure that our gas supply is assured, that there is no risk to Territorians and that it doesn't cost us anything," she said.

"As a Federal Government minister, he is in a position to do that."