Cash-strapped Northern Territory eyes gas reserves to beat debt

Australia's Northern Territory is trying to clear some of its mountainous debts by ending a ban on fracking its vast gas reserves, but green activists and indigenous groups say officials rushed the plan through without addressing key issues.

With debt set to surge past Aus$6 billion next year, quadrupling from just two years ago -- and estimated to hit Aus$35 billion in a decade -- lawmakers are desperate to find ways to fill the gap.

Having already sold a 99-year lease for Darwin's port to a Chinese firm with extensive government contacts -- causing consternation in Canberra and among Australia's military allies -- attention is now on what sits beneath the sandy ochre earth.

The Beetaloo Basin - a resource-rich area hundreds of kilometres south of Darwin -- is believed to hold three-quarters of the Territory's shale gas resources.

The industry's speculative forecasts suggest the Territory may have up to 500 trillion cubic feet of gas reserves -- more than the United States' proven reserves -- with the potential to bring in vast royalties.

"Estimates have predicted that hundreds of millions of dollars could be spent on civil works and gas exploration in the Territory this year," the state's Natural Resources Minister Paul Kirby told AFP.

"I am focused on making sure the emerging onshore gas industry focuses on local employment and local business opportunities."
"The NT Government has a long history of being incompetent at these sorts of things," he said. "They can't get their processes in government working and get their facts straight half the time. They're cutting corners, and I don't think they can properly regulate the industry."