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Petroleum industry

Australian Government Grants BP Permits to Explore for New Oil Reserves

Strategic Insights

— 1 min read

The Australian government has granted BP four permits to explore for oil and gas in the Ceduna Sub-basin off South Australia, following an extensive assessment that examined BP's ability to undertake the work in accordance with Australia's stringent requirements. This is the first time Australia has granted additional rights to BP since the 2010 Gulf of Mexico spill disaster. The permits will result in a guaranteed exploration investment of A$682 million (US$674.63 million) over the next three years, enhancing the country's energy security.

Key Takeaways:

  • The Australian government has awarded BP four permits to explore for oil and gas in the Ceduna Sub-basin off South Australia.
  • The permits follow an extensive assessment that examined BP's ability to undertake the work in accordance with Australia's stringent requirements.
  • Additional conditions have been attached to the permits to ensure best practice, which BP has accepted.
  • Drilling is not expected to take place until 2013 at the earliest.
  • The Ceduna Sub-basin is considered a very exciting new exploration area for BP, with a high potential for containing hydrocarbons.
  • The seven permits, including three awarded to other companies, will result in a guaranteed exploration investment of A$682 million (US$674.63 million) over the next three years.
  • SA's Minister for Mineral Resources Development Paul Holloway estimates that the permits could lead to almost $1.5 billion in spending on the search for petroleum.
  • A key component of the assessment was consideration of the lessons drawn from the Deepwater Horizon incident and the Montara incident in offshore Northern Territory.

Statistics:

  • A$682 million (US$674.63 million) - guaranteed exploration investment over the next three years.
  • A$1.5 billion - estimated spending on the search for petroleum.
  • 2010 - year of the Gulf of Mexico spill disaster.
  • 2013 - earliest expected year for drilling to take place.
  • 4 - number of permits awarded to BP.
  • 7 - total number of permits awarded to companies to explore in the Carnarvon Basin off Western Australia.

Sources:

  • Asia Pulse, "BP gets A$682m in permits for new offshore oil and gas fields" (Jan 17, 2011)
  • AAP, "BP gets new lease on life as exploration permits granted" (Jan 17, 2011)

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