Essential Petroleum managing director John Remfry, said eight offshore wells were scheduled in the 2004-05 summer season, compared to just one in the previous year.
While Essential Petroleum itself is not drilling any offshore exploration wells this season, a close watch will be kept on two wells about to be drilled in permits adjacent to the company’s acreage.
Remfry believes the urgency behind exploration in the offshore Otway Basin was driven by a once-in-a-lifetime opportunity to fill a looming hole in gas-fired energy supplies to the eastern states of Australia.
“Industry projections show that gas production will fail to meet demand as early as 2011, in just seven years’ time, despite the major discoveries of Geographe and Thylacine in the offshore Otway Basin in recent times.
“Given that offshore discoveries take five to six years to reach production, the eastern states of Australia are fast-approaching a shortfall in their future energy supplies.”
Remfry added that explorers were focusing on the Otway Basin because it was only basin that was big enough and prospective enough to meet the projected shortfall.
“The two mainstays of gas supply to the eastern states - Bass Strait gas from the Gippsland Basin and the Cooper Basin – are fast depleting after decades of production.
“By contrast, the Otway Basin is still lightly explored, and has already produced some major discoveries. It’s three times the area of the Gippsland Basin and rich with structures and petroleum systems. It’s no surprise there is an expectation in the industry that whoever makes the next big discovery is going to be in the box seat.”
Santos is drilling the Callister-1 and Amrit-1 wells in permits adjacent to and immediately east of Essential Petroleum permits VIC/P46 and VIC/P50 respectively.
Amrit-1 is a wildcat beyond the edge of Australia’s continental shelf in more than 1000m of water, with potentially huge rewards if hydrocarbons are found. Santos is targeting a prospect with a potential to host more than 700 million barrels of oil, with a gross value of more than $40 billion at today’s oil prices.
