Territory Stories

Hendo's life-line fails to perform



Hendo's life-line fails to perform


Elferink, John

Political affiliation

Country Liberals


Media Releases for 11th Assembly 2008 - 2012; Media Releases; ParliamentNT




Made available via the Publications (Legal Deposit) Act 2004 (NT)




Parliaments; Committees and inquiries; State and territory government administration

Publisher name

Northern Territory Opposition

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Issued as a Media Release

Copyright owner

Northern Territory Opposition - Country Liberals

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COUNTRY LIBERALS DISSENTING REPORT 19 PowerWater14 PowerWater is an organisation that is facing serious issues. In recent times it has needed to respond to an infrastructure that has fallen into decay. It is notable that not even senior management of PowerWater was aware of the situation until 2004 when as the result of an EBA, staff insisted on a review of the condition of the network. Subsequent failings in the supply of gas generation facilities and the network have revealed how frail the system has become. Borrowings by the organisation have loaded enormous debt onto the firm and although its equity position has improved the cash flow of the company is of concern. Recent power price hikes, although critical, have left the organisation in a position where it is merely viable rather than commercial. The Country Liberals are concerned that the organisation may be borrowing to deal with recurrent funding.15 It is of concern to the Country Liberals that as a result of questions being asked of PowerWater on 28 January 2010 that a pedestrian approach is being taken toward determining the cause of the shutdown of gas by NT Gas in November 2009. Whilst evidence has been given that the line has been pigged and that the gas is now flowing within specifications, the absence of a report actually describing the nature of the fault that caused the interruption is a substantial shortcoming. Evidence received that the preliminary report found no fault is simply not good enough. It is self evident that something serious went wrong when 14,000 customers are lost. That two and a half months later, knowledge of that failure is still limited to mere speculative comments by the CEO is concerning, especially as these arrangements are all in place to improve the power generation network in the Territory. The review by Sinclair Knight Merz to be undertaken into the PowerWater Corporations capital and maintenance program is surprising, considering the attention that has been focussed in recent times by other reviewers. NT Gas was asked to provide evidence by the CTC but thus far have declined to attend. This is unacceptable and represents a simple affront to the gravitas the Chief Minister has supposedly accorded the CTC. Whilst it is acknowledged that NT Gas is a private company the fact remains that its major customer is the Territory Government (through PowerWater). It would be expected that NT Gas would be cautious about upsetting that customer. Clearly NT Gas gives little concern about the opinions of the NT Government. Enis failure to deliver compliant gas within contractual timeframes has also come at an expense to PowerWater. Notably in the Directors report of PowerWaters last Annual Report: Delays in gas delivery required the Corporation to use higher cost alternative energy sources (including distillate) which has a detrimental impact on the cash flow the extent that higher costs are not covered by damages received from Eni. 14 The Country Liberals accept that some of the transcript material is yet to be proofed, supporting these assertions, by the people who made them. However, the Country Liberals are sufficiently confident of their records to believe that no substantive changes will follow. It is for the sake of timeliness and responsiveness that this material has been included for government to consider. 15 The Department of the Chief Minister is currently undertaking a review to advise the Country Liberals of the current fiscal position of Power Water.

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