PACIFIC Aluminium has told staff that it's considering curtailing production at its alumina refinery at Gove, throwing into question the future of the neighbouring town of Nhulunbuy.
The Northern Territory's Chief Minister Adam Giles on Friday said he was disappointed the company has "chosen to scare its employees by discussing curtailment of its Gove refinery before all its options have been exhausted and a final decision has been made".
Nhulunbuy, a town of about 4000 people, is facing major unemployment if the diesel-run alumina refinery is forced to close due to high operating costs and the low price of alumina.
Pacific Aluminium is a subsidiary of Rio Tinto.
In February, former Country Liberal Party chief minister Terry Mills announced a deal to keep the refinery open by releasing 300 petajoules of gas to help it with running costs.
But in July, Mr Giles said the deal had never been signed and instead made a series of offers, first for 195 PJ, then for 175 PJ, and now says there's an additional 30 PJ available from a potential mobile gas facility from 2015.
The offer is contingent on the refinery remaining open for 20 years.
"I implore the company to thoroughly consider all the options that have been presented to them as quickly as possible," Mr Giles said.
"(We) want the residents of Gove to know the Territory government and a range of companies have been doing all they can to source gas to meet Rio Tinto's energy needs."
The new coalition government has also confirmed it's willing to underwrite the funding for the building of a pipeline from Katherine to Gove.
But Mr Giles said Rio Tinto executives have admitted their issues with the refinery weren't about the terms of the gas offer but the scale of financial losses over the past five years, which the company had failed to correct.
"Rio Tinto should leave no stone unturned in its search to find a solution to Gove's energy needs," Mr Giles said.
Labor's Member for Nhulunbuy Lynne Walker accused the NT government of letting the fate of the town hang in the balance.
"Uncertainty created by Mr Giles has plunged our community into crisis, is threatening the livelihoods of Territorians and the economic viability of our region, yet the man still refuses to have the decency to come and explain his actions to our community and provide details," she said.
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