ExxonMobil to drill deep for Bass Strait gas
ExxonMobil has received environmental approval to drill Australia’s deepest ever oil and gas well in the Bass Strait.
Energy giant ExxonMobil has received environmental approval to drill Australia’s deepest ever oil and gas well in a bid to unearth fresh supplies and reverse an energy squeeze on the nation’s east coast.
Exxon will drill the Sculpin well in the Bass Strait in the next few months off the coast of Victoria to an expected depth of 2300 metres, an all-time Australian record and even deeper than a controversial oil well planned by Norway’s Equinor in the Great Australian Bight.
The Sculpin prospect received environmental approval from the National Offshore Petroleum Safety and Environmental Management Authority on Monday.
It expects Exxon to start a 75-day drilling period in late September or early October at Sculpin, which is 90km from the Victorian coast. The US oil major’s search for a giant gas field follows the failure of its nearby Dory prospect late last year where a $120 million, two-well drilling program failed to yield a discovery.
It also underlines the pressure on one of the east coast’s biggest gas producers to find fresh supplies for the country’s domestic markets ahead of a forecast supply squeeze in the next few years.
“Esso will utilise the Ocean Monarch, currently in the Bass Strait for other work with the Gippsland Basin Joint Venture and other companies, to drill an exploration well in 2019,” Exxon said.
“This well is targeting a gas prospect, with the objective of proving up resources for timely development and contribution to the Australian domestic gas market.”
Exxon will look to Sculpin as a potential source of gas in the next decade to supply the Longford gas plant, which is facing spare capacity as the big Bass Strait fields that have been the nation’s biggest domestic producer for most of the past 40 years start to rapidly decline.
The lack of a new Bass Strait discovery means the southeast of Australia may have to rely on importing gas through pipelines from Queensland or from the LNG import terminals that proponents including Exxon are studying.
“The well is one of the east coast’s biggest hopes for major new gas supply,” EnergyQuest chief executive Graeme Bethune said in a report this month. “The size of the prospect has not been released, but the water depth suggests ExxonMobil is chasing a multi-trillion cubic feet discovery.”
In addition to its potential for easing a domestic gas squeeze, the Sculpin well will also be closely watched due to its depth with the regulator requesting more information from Exxon on three occasions before approving the environment plan.
Sculpin will be three times deeper than any previous Gippsland Basin well and at 2300m will also surpass Equinor’s proposed Stromlo well in the Great Australian Bight.
Opponents to Equinor’s drilling plans are concerned any oil spill in the Bight could cause huge marine damage off the South Australian coast.
Along with BHP, Exxon approved the $550 million development of the offshore West Barracouta gas field in December to help stem steep forecast declines and maintain plateau production of about 700m cubic feet a day. It’s also looking at development opportunities at Snapper deep and Whiting in the Bass Strait.