The fast-track process to build this pipeline started when the then Northern Territory Minister of Mines and Energy Ian Tuxworth announced in April 1984 that the Northern Territory Government had accepted an offer from a consortium, headed by the Westpac Banking Corporation, to examine the feasibility of a natural gas pipeline from the Amadeus Basin, near Alice Springs, to Darwin.

Mr Tuxworth said that the gas study proposal was outlined in a letter received from Westpac’s Managing Director on behalf of Westpac, The Australian Gas Light Co., AMP, Boral Ltd, CSR Ltd, Moonie Oil Co, and Nabalco.

As a result of the study, the Northern Territory Government deferred a decision to build a coal-fired power station near Darwin. If the feasibility study confirmed the gas pipeline as a viable proposition, the seven companies said that they would be interested in having ongoing roles in implementing the construction, ownership and operation of the pipeline and development of a Northern Territory gas industry.

The cost of a feasibility study was to be met by the companies as part of the development costs. The feasibility of the gas pipeline depended on the provision of sufficient gas reserves in the Amadeus Basin, west of Alice Springs. The Palm Valley Gas Field in the Amadeus Basin had already been supplying gas to Alice Springs for gas-fired generation for some time.

It was planned to present the results of the 1,500 km Amadeus Basin to Darwin natural gas pipeline feasibility study to the Northern Territory government in August 1984 and, if the go-ahead was given by the government, design work would be completed by mid-1985 with construction underway early in the third quarter of 1985.

The preliminary study dealt with the comparative economics of using natural gas or coal to fuel the Channel Island Power Station at Darwin, and concluded that gas was an economical proposition. The Channel Island Power Station would provide a major market for natural gas from the Amadeus Basin and this first study took the project one step forward.

With this preliminary study completed, a more detailed study was undertaken to determine the detailed economics of the project. The second report was expected to be presented to the Northern Territory Government in late August. This study was being carried out by a consortium headed by Westpac Banking Corp. It was believed that several other groups, including the Amadeus Basin partners, were carrying out separate studies.

By October 1984, the Northern Territory Government had virtually sealed its plans for a gas pipeline from Alice Springs to Darwin, with the signing of tentative construction and gas supply contracts. Mr Tuxworth, who was now Northern Territory Chief Minister, signed a Memorandum of Understanding with the consortium led by Westpac, which recommended the construction of the pipeline.

A Letter of Intent (LoI) was also signed with the Palm Valley gas producers to supply the gas. At this stage the LoI provided for gas production only from Palm Valley. However negotiations were well underway with the partners in the Dingo and Orange gas fields to supply gas into the network.

It was proposed that there would be four construction spreads. A key element of the program was scheduling the Darwin to Katherine construction spread during the dry season. This required immediate commencement of route investigation, right of way acquisition, engineering and procurement activities. An order for the purchase of pipe was to be placed by the end of 1984.

Mr Tuxworth congratulated the industry on proving up of reserves to supply Darwin and reduction in real costs of building the pipeline. He praised the industry, saying “By adopting technological change and sound industrial relations and management practices the pipeline industry had been largely responsible for reversing the Territory’s 1981 decision to go to coal.”

The second element in the equation that led to this decision was the commitment of both the Northern Territory Government and the petroleum industry to thoroughly assess the Amadeus Basin gas reserves. Mr Tuxworth also called for the pipeline to be planned as part of an Australian gas pipeline grid.

In addition, Mr Tuxworth gave details of the planned oil pipeline from Mereenie to Alice Springs and the proposed 200 km gas pipeline from Mereenie to the Yulara tourist complex at Alice Springs. He said it was expected that construction of the Mereenie Oil Pipeline would get underway in the 1985 dry season. “The proposal to construct a gas pipeline from the Amadeus Basin to Darwin and Gove had captured everybody’s imagination,” he said.

“Gas will also be used to generate power in the larger intermediate regional centres. This concept was not a new one by any means. A study in 1981 looked at the feasibility using Amadeus natural gas, but the level of proven reserves and the pipeline costs ruled the option out at that time.”

As of November 1984, the project was at the stage where commercial negotiations were being conducted on behalf of the Government by a team comprising representatives of the Department of Mines and Energy, Treasury and the Northern Territory Electricity Commission (NTEC).

This team was being advised by the Royal Bank of Canada (RBC) who had been appointed by the Government as financial advisors on the project. The Government accepted the proposal from NT Gas in principle, with the only condition being the successful negotiations of terms and conditions comparable with those assumed in the NT Gas report of 20 August 1984.

The Government then signed an LoI with Palm Valley Joint Venture for the purchase of sufficient gas for the Darwin market for 20 years. Monenco had been accepted to assist NTEC and the RBC to study the various options for a gas fired power plant, namely open or combined cycle gas turbines.

At the same time, environmental standards were being developed by the Conservation Commission of the Northern Territory (CCNT) in liaison with the Department of Mines and Energy, NT Gas and Harry Butler (consultant to CCNT).

Landowners were also being identified along the tentative route proposed by NT Gas with a view to informing them of the project and, where necessary, negotiating right of way.

By February 1985, the proposed 1,500 km Amadeus Basin to Darwin natural gas pipeline was underway. Tenders for the supply of pipe for the 300 km section between Darwin and Katherine had been called. Tenders for pipe for the section between Palm Valley and Katherine were to be called once a decision was made on an extension of the pipeline to Gove.

Friday 28 June 1985 saw the signing in Darwin of the contracts relating to the supply of gas to NTEC for power generation. The contracts underpinned the financing of the pipeline.

Under the leverage lease, Australia’s four major trading banks – ANZ, National Australia, Westpac and Commonwealth – would provide up to $380 million for the pipeline.

Mr Tuxworth said that the formalities set in place the machinery for the supply of gas – by the Palm Valley and the Mereenie Joint Venturers – to pipeline operator NT Gas Pty Ltd. NT Gas was the special purpose company formed by some of the cream of Australian industry – CSR, AGL, and Moonie Oil.

“The involvement of this consortium speaks volumes for the significant position the Territory holds in the future of Australian industry,” he said. He also made the point that major contracts had been let to Australian companies for supply of the first stage of pipe between Darwin and Helling (north of Katherine) and for the supply and coating of the line pipe. Mr Tuxworth said that under the arrangements set in place, NT Gas through its project managers Williams Brothers — CMPS, would build the pipeline, and on its successful completion sell it to the banks. The banks would then lease the pipeline back to NT Gas as operators.

The construction contract for the first 250 km spread was awarded to Newham International, a joint venture between ICC Construction Company, and Eric Newham Holdings Pty. Ltd. ICC was a South Korean firm that had carried out extensive pipeline work in Australia when it built the central section of the Dampier – Perth pipeline.

Tubemakers of Australia and Shaw Industries, both Australian companies based in Port Kembla, were awarded the contracts for the manufacture of the steel pipe and high density polyethylene coating pipe for the project.

There were a total of four spreads with Newham International starting construction work on the first spread, 250 km from Darwin to Helling late in July 1985.

Spread two, 250 km from Helling to Buchanan Highway was awarded to Saipem Australia with Claudio Savini as Project Manager, Eddie Rimmer as spread boss and Graham Doye as assistant spread boss.

Spread three, the longest at 477 km from Wauchope to Buchanan Highway, was awarded to McConnell Dowell with Mark Twycross as Project Manager and Keith Nelson site administrator.

Spread four, 250 km from Wauchope to Palm Valley, was awarded to Transfield – PBM with Graham Tait as spread boss.

Williams Brothers – CMPS Engineers were responsible for construction management and their construction supervisors were Bill Guthrie on spread one, Keith Potter on spread two, with Bob Young on spread three and Joe Ashton on spread four.

Pipetech Pty Ltd was appointed as regulatory consultants to the Northern Territory Department of Mines, with Peter England as Field Superintendent and Peter Wheelwright as Senior Pipeline Engineer.

Construction of the pipeline was completed well on time and within budget ,with rivalry amongst the various spreads adding to the speed of completion.

In the early hours of Sunday 9 November 1986, gas reached the Darwin City Gate. Electricity from natural gas was produced for the first time at the Channel Island Power Station on 15 December 1986 when the first of five gas turbines was connected into Darwin’s electricity system.

Recently, construction and commissioning was completed on the Bonaparte Gas Pipeline, running from the onshore gas plant at Wadeye to the existing Amadeus Basin to Darwin Pipeline near Ban Ban Springs.

The pipeline will process and transport gas from the Blacktip Gas Field to meet the Northern Territory’s long term gas requirements and replace the declining gas supply from the Palm Valley and Mereenie fields.