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Darwin will be home to the largest ship lift in Northern Australia from 2023 now the Northern Australia Infrastructure Facility (NAIF) has signed off on a $300-million loan to the Northern Territory Government.
Key points:
- The NAIF loan is worth $300m, with the NT contributing a further $100m upfront
- The ship lift will be the largest facility of its kind in Northern Australia
- Defence has not committed to using the ship lift but said they would consider it on a commercial basis
The NT Government will contribute a further $100 million and under the 28-year loan term offered by NAIF will not begin repaying the loan's capital to the federal government for 15 years.
According to Minister for Northern Australia Matt Canavan, the facility will be able to service vessels weighing up to 5,000 tonnes and as long as 103 metres.
"By building this ship lift here [in Darwin] ships that operate in the North won't have to go to the South for their maintenance to keep on the water," Mr Canavan said.
The ship lift will be located next to the Darwin Port, which is leased by the Chinese-owned company Landbridge.
He said it currently cost the Defence Department $500,000 every time it sent a naval vessel to the ship lift in Fremantle, Western Australia for servicing.
"By building this ship lift here, it will mean the offshore patrol vessels, the Arafura class vessels, won't have to travel 10 days all the way to Fremantle and back, just to get maintenance done," he said.
Both the Northern Territory and Federal governments said they expected the Defence Department would be a major customer of the future ship lift as well as other industries.
However, in a statement, a Defence spokesperson told the ABC there was no formal arrangement or "requirement" for Defence to use the future facility.
"Should the facility be built, Defence may consider using the facility on an as-needed basis on commercial terms," the statement said.
Mr Canavan said it was the role of NAIF to fund projects that would "attract customers", such as Defence.
"It is about taking a degree of risk," he said.
"We've had extensive discussions with Defence, I'm confident they will be a significant user of this facility, but they are not investors."
Ship lift is 'critical' infrastructure
NT Chief Minister Michael Gunner said the ship lift was "critical" infrastructure that would help break the NT economy out of its boom-and-bust cycle.
"The way through it is to create jobs like this in the services sector — consistent, permanent, ongoing jobs," he said.
Mr Gunner said the final engineering tender would be released this year, followed by a construction tender in June 2020, construction in 2021 and that it would be servicing vessels from 2023.
The ship lift will be run by Darwin-based pearling company Paspaley, who will also use it to service their own vessels.
Paspaley Chief Operating Officer Sam Buchanan said without the ship lift the company would soon have to take its service needs interstate or abroad.
"By having this sort of infrastructure here for the next 50 years … we can continue to invest in bigger vessels, and keep accommodating them in Darwin," Mr Buchanan said.
"We don't want our large vessels having to go to Singapore or Henderson for work, and many others who operate in Darwin have the same feeling."
In a statement, the NT Department of Trade, Business and Innovation said the pricing and access to the ship lift would be overseen by the independent Utilities Commission.
The current proposal according to DTBI is that Paspaley's subsidiary Northern Ship Support would operate the ship lift.
However, Paspaley's separate subsidiary Pearl Marine Engineering (PME) will compete with other marine service providers for maintenance services for vessels that use the ship lift, or wet berths.
"That is, it is proposed that NSS operate the ship lift facilities while marine service providers such as PME compete for the actual vessel maintenance work," the department said.
Opposition welcomes ship lift, concerned about debt spiral
NT Opposition Leader Gary Higgins said he welcomed the federal loan towards the ship lift but held concerns about adding to the NT's massive debt.
"I am still concerned about the details of the project under the Gunner Labor Government, and am aware this is another $300 million Territorians now have to pay back over the next 28 years, and another $100 million added to the emerging debt burden," Mr Higgins said.
Mr Gunner said the terms of the loan were "the best deal a government could get", and that he believed a future Labor federal government may wipe the ship lift loan entirely.
He would not say how much the NAIF loan would cost the government in interest repayments.
Topics: government-and-politics, building-and-construction, darwin-0800, nt, australia
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