Climate activists win in NT gas field case

But federal Resources Minister Keith Pitt has also claimed the decision as a win. 

He says development in the basin will go ahead and the court cleared up an administrative error.

The Environment Centre NT argued the grant was legally unreasonable on multiple grounds.

It said Mr Pitt should have considered the potential climate change impacts before handing over taxpayers' money to Imperial Oil and Gas.

The ECNT's legal team also said Mr Pitt relied on advice that said Imperial's drilling projects were likely to generate over $70 million in investment, which was incorrect.

It failed on those grounds.

However, Justice John Griffiths agreed with the ECNT that it was legally unreasonable for Mr Pitt to enter into the grants contracts.

They were signed on September 9, just days after ECNT applied for an urgent court hearing over the matter and while legal proceedings were underway.

He ordered that the commonwealth's decision to enter into three contracts with the Empire Energy subsidiary were invalid and declared them void.

Mr Pitt said he welcomed the decision and the court had rejected a legal challenge that could have jeopardised a major resources project.

"This is a common-sense decision that will allow grants for the development of the Beetaloo Basin to proceed, which has the potential to deliver thousands of jobs and billions of dollars in economic activity," he said

Mr Pitt said the judgment showed the program and the approval decision to award grants was valid.

Empire Energy said it would work with the commonwealth to negotiate replacement agreements.

"As no funds had been advanced by the commonwealth to Imperial under the grant contracts, no funds are repayable to the commonwealth," a spokesman said.

The Beetaloo sub-basin has been estimated to hold more than 200,000 petajoules of gas. 

According to one expert report, extraction and consumption of gas from the basin could equate to a 13 per cent increase on Australia's 2020 greenhouse gas emissions.

ECNT director Kirsty Howey said Australia was lagging behind the global transition to renewable energy because the Morrison government insisted on propping up the fossil fuel industry.

"Under Australia's commitment to the global Glasgow Climate Pact we need to phase out funding of new oil, gas and coal projects," she said.

"The public has an expectation that taxpayer money will not be used to accelerate climate catastrophe by funding projects that will release vast amounts of emissions."

Greens leader Adam Bandt said developing a Beetaloo Basin gas project "four times the size of Adani" would be a "climate crime".

"Fracking the Beetaloo would blow Australia's carbon budget, making it impossible for us to meet our emissions goals," he said.

Environmental Defenders Office lawyer Elaine Johnson said Beetaloo Basin gas field extraction could lead to a significant global emissions increase.

"So it is critically important that the government is held accountable for any decisions to use public funds for new gas in the Beetaloo," she said.

"In this case, the court found those reasonable inquiries did not extend to climate risk given the (drilling) project does not involve extensive gas extraction and production," she said.

Protect Country Alliance said the "Morrison government's rush to throw billions in public money at gas giants was blatant corporate welfare" and Mr Pitt's actions were "appalling and reckless".

The $21 million contract between the government and the Empire Energy subsidiary is part of a $50 million Beetaloo Cooperative Drilling federal grants program.

Grants under this program are subject to the Commonwealth's Public Governance, Performance and Accountability Act 2013.

It requires Ministers to be reasonably satisfied that public money will be used efficiently, effectively, economically and ethically before making funding decisions.