Gas will start flowing from the Beetaloo Sub-basin into the NT’s electricity grid starting Tuesday, marking a pivotal shift from years of resource exploration to production, but the Chief Minister has warned Territorians not to expect to see any reductions in their power bills.

Tamboran Resources, the largest explorer in the Beetaloo region, will begin first gas production from its Shenandoah South field Tuesday, more than two years after signing a nine-year supply deal with the previous Labor government that did not go to a competitive tender, the total cost of which has also never been disclosed but estimated to be worth more than $3 billion of taxpayer funds.

Over 40 terajoules a day of extracted gas from the Shenandoah field will be transported via the Sturt Plateau pipeline to the north-south Amadeus pipeline, then to the Channel Island power station, the Territory’s main energy generation facility, the government said.

Chief Minister Lia Finocchiaro said the gas from the Beetaloo Basin will ensure a bright future for Territorians by fostering new investments across various sectors, generating jobs, and boosting the economy.

But she warned Territorians not to expect to see any savings on their power bills.

“The Beetaloo Basin will usher in a new era of energy security, industrial development, and economic prosperity and opportunity for Territorians and our nation,” she said in a statement.

“As a government, we are so incredibly proud to say that gas from the Beetaloo Basin will be powering Territory homes and businesses. Every time Territorians flick on a light switch, or pull a cold beer from the fridge, they’ll see the benefits of the Beetaloo Basin at work.”

But asked by a listener on Mix 104.9 Monday morning about potential savings on power bills, Ms Finocchiaro said that was not going to happen.

“I would love to say yes, unfortunately, that’s not going to be the case,” she said.

“But what we will see is a serious stabilisation. So, we are doing massive amounts of reform behind the scenes on our power generation and networks to make it much cheaper to produce…and so that we’re not passing that cost on to Territorians, and we have an enormous community service obligation.”

Ms Finocchiaro reiterated that the government is already subsidising power bills, as has every Territory government for decades.

“But what this should mean is power prices do not just continue to go up as sharply as we have seen, and of course, it will underpin that really important industrial development,” she said.

The NT Government’s current supply agreement with ENI for gas from its Blacktip facility has has been plagued with problems and unable to meet demand in recent years, forcing emergency supply agreements with other gas companies to keep the NT’s lights on at considerable expense.

Ms Finocchiaro said the new gas supply will end the Territory’s “energy crisis”.

“It’s ridiculous to think we’re sitting on 200 years worth of gas and yet we have had to have diesel tanks filled to the brim just in case we run out of gas for Territorians,” she said.

“The fact that we have been living on the edge for 40 years is ridiculous and from tomorrow that ends.”

She added developing the basin is forecast to generate more than $17 billion in “economic value over the next two decades”, supporting jobs and royalties, as well as helping to grow the NT’s stagnant economy.

But the Environment Centre NT said while the CLP Government is celebrating and back-slapping each other and industry over the use of appraisal gas, economic modelling shows fracking the Beetaloo remains commercially unproven beyond the pilot stage, with “massive government subsidies likely needed to progress projects further”.

“This is a PR stunt from an industry with bleak economic prospects and no social licence to operate in the Territory,” said ECNT acting Co-CEO Bree Ahrens.

“Despite the spin about keeping the lights on, the reality is that fracking is propped up by huge amounts of our money, secret deals behind closed doors and inflated job figures.

“The Territory is billions in debt yet taxpayer money is being wasted on bankrolling risky Beetaloo fracking.”

Mines and Energy Minister Gerard Maley said in the statement the government has made reforms aimed at enhancing resource development and investment stability, including making 4,000 sq/km of “highly prospective” land available in the Beetaloo region, supported the construction of APA’s Sturt Plateau Pipeline, facilitating gas recovery projects, and advancing energy infrastructure connections, including the proposed gas pipeline from North Australia to the East Coast.

“Since coming to office, our government has made unlocking the Beetaloo and getting it into production a key economic priority,” he said.

Ms Finocchiaro and Mr Maley will attend Tamboran’s Shenandoah South development on Tuesday for the first appraisal gas activation tomorrow, with Ms FInocchiaro pledging to “post some photos”.

The Beetaloo Sub-basin is one of the world’s most significant onshore gas reserves, boasting an estimated 430 trillion cubic feet of gas – enough to satisfy Australia’s gas demand for the next 200 years, the government has said.