Offshore hydrocarbon exploration in Australia for 2019 is expected to rise to the highest level since 2014

February 1, 2019


Edited and Published by GEOExPro Magazine. This article appeared in Vol. 16, No. 1 – 2019.
 
 
Offshore Hydrocarbon Exploration Australia

Australia experienced both exciting discoveries and disappointing dry holes in 2018, drilling 60 exploration wells over the year. Buoyed by strong demand, policy change and recovering oil prices, Rystad expects to see this figure rise to 65 in 2019, with offshore exploration increasing to the highest level seen since 2014.

Hydrocarbon Discoveries in Australia in 2018

About 360 MMboe were discovered in Australia in 2018, at an exploration expense of close to US$1.4bn (US$850m offshore and US$550m onshore). Chief among 2018’s successes was Quadrant’s Dorado-1 well in the Bedout Basin (North West Shelf), which discovered 171 MMbo, 16 MMbc and 552 Bcfg (2C), making it 2018’s 12th largest discovery globally. Quadrant has now turned to the Apus prospect, where it hopes to unlock over 750 MMboe, although drilling is not expected until 2021.

In contrast, ExxonMobil and BHP’s much-hyped 2–3 Tcf Dory prospect in Victoria’s Bass Straight came up dry, with both wells, Baldfish-1 and Hartail-1, plugged and abandoned as uncommercial. However, the joint venture plan to continue exploration within Dory’s permit area (VIC/P70), where further gas potential remains in the Angler (140 Bcf) and Archer-Anemone (175 Bcf) prospects.

Australia Exploration 2019 Rystad Energy Well Count

High Expectations for Oil and Gas Exploration Activity in Australia in 2019

Strong market fundamentals and favourable policy change should see exploration expenditure in Australia more than double from 2018 levels in the next five years, reaching an annual spend of US$3.6bn by 2023.

Offshore, 2019–20 should see Equinor drill its long-awaited Stromlo-1 well in South Australia’s Ceduna Basin: the first well in the Great Australian Bight since Woodside’s Gnarlyknots 1A in 2003. However, there is strong community opposition to the project and NOPSEMA is yet to approve the well. Success here would be the first step to unlocking the Bight’s potential multi-billion boe resource.

2019 could prove transformational for Australia’s fledgling shale industry. The repeal of a fracking moratorium, in place in the Northern Territory since 2016, should result in at least four shale wells in the highly prospective McArthur Basin this year. Before the moratorium, Origin Energy conducted one of the largest fracture jobs ever undertaken in Australia on their Amungee NW-1H well in the MacArthur Basin, successfully flowing over 1 MMcfpd on test. This enabled Origin to book 6.6 Tcf of contingent resources in the play, and also acted as a proof-of-concept for the basin, representing the first extended commercial-level gas flow from shale in the state. Origin now plan to drill and frack two horizontal wells in 2019.

Following the success of its Northern Territory Tanumbirini-1 well in 2014, where the company reported gas over a 500m (gross) interval, Santos is expected to drill two horizontal appraisal wells in the McArthur Basin. Success here has the potential to kick-start a rapid development of the region.

 

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Contacts

Daniel Levy
Senior E&P Analyst
Phone: +61 422 401 192
daniel.levy@rystadenergy.com

Morten Bertelsen
Media Relations
Phone: +47 951 98 742
morten.bertelsen@rystadenergy.com

 

About Rystad Energy
Rystad Energy is an independent energy research and business intelligence company providing data, tools, analytics and consultancy services to the global energy industry. Our products and services cover energy fundamentals and the global and regional upstream, oilfield services and renewable energy industries, tailored to analysts, managers and executives alike. Rystad Energy’s headquarters are located in Oslo, Norway with offices in London, New York, Houston, Stavanger, Moscow, Rio de Janeiro, Singapore, Bangalore, Tokyo, Sydney and Dubai.