The Greens are hoping to use their Senate numbers to pressure the Albanese government to drop its $1.5 billion commitment for a petrochemicals and gas carbon capture and storage hub planned for Darwin Harbour from next week's budget.
The Northern Territory government is spearheading plans to develop the manufacturing and minerals precinct in Middle Arm, south of Darwin, which would include a facility to convert natural gas into products like plastics and paint.
April's federal budget promised the funding for a new wharf and offloading facility in the area, however it has not been allocated over the forward estimates period.
The federal government has said the hub could also produce green hydrogen.
Environmentalists have been lobbying hard for the budget commitment to be dropped.
"This Middle Arm project is about making petrochemicals from gas fracked from the Beetaloo Basin," NT Environment Centre Director Kirsty Howey said.
"It will be a climate and health disaster for the Northern Territory and it's a public subsidy to the fossil fuel industry, pure and simple.
"It should not be paid for by the taxpayer."
At the weekend, federal Infrastructure Minister Catherine King said the hub, first promised by former Nationals leader Barnaby Joyce, would be in the budget.
"This is a really substantial build within the marine processing precinct within Darwin, it's a big economic boost for Darwin," she said.
"It's about building a big jetty out to be able to potentially get hydrogen in, and other goods and services in and out.
"It's enabling infrastructure."
Greens threaten to withhold Senate support
The Greens are threatening to use the balance of power to try to pressure the government to drop fossil fuel subsidy promises across the country, including for new gas developments in the NT's Beetaloo and Queensland's Bowen and Galilee Basins.
Greens resources spokeswoman Dorinda Cox said the Middle Arm commitment was the biggest and most unacceptable budget commitment so far.
"The purpose of this project is to facilitate gas coming from the Barossa [gas project off the Northern Territory coast] and Beetaloo Basins," she said.
"We hold the balance of power, plus one, across the crossbench and there would need to be a serious conversation with us about the validity of this."
Asked whether the party felt so strongly about this particular project that it intended to withhold Senate support over it, she said: "It would definitely be a consideration."
Senator Cox said the project dId not fit with the government's climate commitments.
"The government needs to align their current commitments in the budget with their policy commitments and legislation about triggering the climate issues in our communities," she said.
"We are talking about giving public money to new coal and gas projects, this is about export of gas out of Australia by Middle Arm, and we cannot continue to do that."
Some independent senators, including David Pocock, are also calling for the Middle Arm commitment to be dropped.
"We've heard so much from the government about how tight the budget is and how the priority needs to be addressing the cost of living crisis and the housing pressure that people are feeling," he said.
"It makes no sense for a huge investment of taxpayer money that's essentially a subsidy for the fossil fuel industry."
Opposition plans to back project
The federal government does not need Greens votes to pass the budget because the convention is that the opposition agrees to guarantee its supply of cash.
Opposition Leader Peter Dutton said he remained firmly behind the Middle Arm project.
"We certainly support infrastructure investment into the Northern Territory, we need to access additional gas, we need to make that investment," he said.
Gas industry body APPEA is reminding the federal government that expanding the industry will boost the tax it pays, forecast in the March budget to reach $2.4 billion dollars of Petroleum Resource Rent Tax in this financial year.
"The industry has already been collaborating with authorities by progressing the Darwin Carbon Capture and Storage Hub planned for the Middle Arm area and set to service a range of industries using emissions reduction technology to lower their footprints," APPEA said.
"This infrastructure can also underpin the development of an extraordinary economic and energy security opportunity like the Beetaloo Basin, where … many jobs could be created alongside substantial government revenues for the next two decades."
