BP withdraws from Great Australian Bight drilling

Swellnet Dispatch

BP has announced it will not proceed with plans for exploration drilling in the Great Australian Bight, offshore South Australia.

In a statement, BP said it would instead focus on projects it can exploit in the short-to-medium term.

BP had been awaiting environmental approval to begin exploration drilling for two wells off South Australia's west coast about 400 kilometres south-west of Ceduna.

Its previous environment plan for the region had been knocked back twice by the National Offshore Petroleum Safety and Environment Management Authority (NOPSEMA).

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Exploration and production managing director Claire Fitzpatrick said the decision was not related to the potential for oil in the region or the pending decision by an independent federal regulator.

"We have looked long and hard at our exploration plans for the Great Australian Bight, but in the current external environment, we will only pursue frontier exploration opportunities if they are competitive and aligned to our strategic goals," she said.

Ms Fitzpatrick said significant progress had been made to prepare for drilling in the Bight with the support of the community, and federal, state and local governments.

"This decision has been incredibly difficult and we acknowledge it will be felt across the South Australian region," she said.

"We acknowledge our commitments and obligations and our priority now is to work with government and community stakeholders to identify alternative ways of honouring these."

She said BP had informed the federal and South Australian governments of its decision.

BP has let down Australians: SA Treasurer

BP was awarded exploration licences for four blocks in the Ceduna area of the Bight in January 2011. Other companies including Chevron and Santos are still seeking to explore for oil in the Bight.

SA Treasurer Tom Koutsantonis said BP had let the community down. "Every Australian has the right to feel disappointed by BP," he said.

"They made a promise to the South Australian Government that they would spend nearly $1.4 billion on exploration of the Great Australian Bight when they tended for these tenements and now they've withdrawn.

"I think they have done a bit of damage to their brand."

Ceduna Mayor Allan Suter said he was shocked by BP's decision. He said the community would have gained a lot from the exploration had it gone ahead, including 36 workers based in Ceduna during the drilling campaign.

"We didn't see it coming. I don't think anybody locally saw it coming," he said. "The decision was made overseas on commercial grounds, it was very sudden after a lot of money had been spent. So a bit of a surprise to everybody I think."

Withdrawal a 'win for the community'

South Australian Greens senator Sarah Hanson-Young said BP had known its project was deeply unpopular in the SA community.

"This is a great win for the community who made it clear that BP weren't welcome from the beginning," she said.

Wilderness Society national director Lyndon Schneiders said all oil and gas companies should follow BP's lead and leave the Great Australian Bight.

"If BP with all its experience cannot produce an acceptable drilling plan for NOPSEMA, the remaining companies exploring in the Bight will be wasting their shareholders' money trying to pursue this folly," Mr Schneiders said.

// © Australian Broadcasting Corporation. All rights reserved.

Comments

sean-doherty's picture
sean-doherty's picture
sean-doherty commented Tuesday, 11 Oct 2016 at 6:44pm

"I think they have done a bit of damage to their brand." Priceless. 

Wharfjunkie's picture
Wharfjunkie's picture
Wharfjunkie commented Tuesday, 11 Oct 2016 at 8:25pm

Shouldn't you be on Coastalwatch Seano? Doesn't matter welcome aboard.

sean-doherty's picture
sean-doherty's picture
sean-doherty commented Wednesday, 12 Oct 2016 at 9:18am

Just grateful Stu gave this news a run Wharf. That proposal was a dog.

mk1's picture
mk1's picture
mk1 commented Wednesday, 12 Oct 2016 at 7:32am

Best news of the week!

thermalben's picture
thermalben's picture
thermalben commented Wednesday, 12 Oct 2016 at 8:07am

This is pretty huge news. Judging by the tone of their response, I can't imagine they'll broach the idea again any time in the next decade or two.

Nav Fox's picture
Nav Fox's picture
Nav Fox commented Wednesday, 12 Oct 2016 at 9:05am

Epic news

Slink

Wharfjunkie's picture
Wharfjunkie's picture
Wharfjunkie commented Wednesday, 12 Oct 2016 at 11:13am

Yes good news other oil companies will be circling.

Question for those more knowledgable than a Wharfjunkie. Theres oil and gas platforms in bass strait and the otway gas fields off Port Campbell with no major environmental issues to date. What makes the Bight different?

stunet's picture
stunet's picture
stunet commented Wednesday, 12 Oct 2016 at 11:33am

Not sure if I'm more knowledgeable than a Wharfjunkie but I'll give it a go...

The Bass Strait oil rigs are mostly - perhaps all? - in the Gippsland Basin and sheltered from swell by Wilson's Prom. I assume that would make 'em less risky.

The rig(s) off Pt Campbell are for gas not oil and if a spill were to occur I don't think the enviro threat is as drastic.

thermalben's picture
thermalben's picture
thermalben commented Wednesday, 12 Oct 2016 at 11:51am

Eastern Bass Strait is a pretty gnarly place for weather systems (it's where the Boxing Day low that decimated the Sydney to Hobart fleet originated from).

Whilst the rigs are located in the lee of the Prom, they're still 120km upwind from the western-most landmass, and 360km upwind from the NW tip of Tasmania (there's also a narrow swell window straight through to the Southern Ocean between King Island and Tasmania). That's more than enough fetch to generate very large waves under extreme weather conditions.

I've seen some wave data from the rigs and they experience some pretty radical conditions. And winds in these offshore waters routinely reach more than 100km/hr during vigorous frontal passages.

Here's the position of the Kingfish B platform, which has a BOM weather station too (and also a 'wave radar', though the data is not publicly available).

Wharfjunkie's picture
Wharfjunkie's picture
Wharfjunkie commented Wednesday, 12 Oct 2016 at 11:56am

Makes sense Stu.

I just had a look at the Origin energy gas fields in Bass Strait. The ones sheltered by Wilsons Prom I believe are operated by Exxon. The Origin fields have a field named rockhopper which is prospective I believe looking at the chart this is Oil and Gas and smack bang in the middle of Bass Straight in the line of any swell it looks like.

http://www.awexplore.com/irm/content/bassgas-project.aspx?RID=398

Noel's picture
Noel's picture
Noel commented Wednesday, 12 Oct 2016 at 11:45am

Its not well known that the Deepwater Horizon disaster was actually a Transocean disaster that became a PR disaster for BP as it was BP's lease that the contractor Transocean was developing. So it was Texans drilling in their own waters that stuffed up and then stood back and said it was BP's fault. thats the short story. If the reserves are going to be drilled you are better off with the large companies than some johnny-come-lately joint venture that doesnt have a global reputation to care about.

inzider's picture
inzider's picture
inzider commented Wednesday, 12 Oct 2016 at 12:01pm

Cluster fuck from bean counters started the ball rolling, and once it started rolling ,,

inzider's picture
inzider's picture
inzider commented Wednesday, 12 Oct 2016 at 11:59am

Meanwhile all you nimbys still drive your cars to your surf spots with your neoprene suits and resin boards. What a fuckin pack of hypocrits. You have a shit ton of rigs in the NW , wheres your protest about them. Unless you are prepared to give up everything petro based in your live,s you are all living a lie if you arnt prepared to take the risk of drilling in your own back yard.

If you want to really have a better understnding of deepwater horizon disaster watch this
https://www.youtube.com/watch?v=aN2TIWomahQ

And sean doherty I imagine you are the dude who writes books, you are an amatuer by the looks by posting a burning deepwater horizon. I would have expected more from a so called professional.

Stunet, there are no rigs in the bass straight just rusting production stations.

Wharfjunkie's picture
Wharfjunkie's picture
Wharfjunkie commented Wednesday, 12 Oct 2016 at 12:06pm

Ok inzider whats your argument for? Apart from everyone is a hypocrite.

inzider's picture
inzider's picture
inzider commented Wednesday, 12 Oct 2016 at 12:13pm

Just following on from previous articles/pages about the exploration of the bight.
Not everyones a hypocrite just the ones not prepared to risk their own backyard but are happy to fire up the barby and fill their tanks from someone elses backyard.

Wharfjunkie's picture
Wharfjunkie's picture
Wharfjunkie commented Wednesday, 12 Oct 2016 at 12:25pm

That's a hard argument mate.
I would question a few things first.
1.Does society require more oil supplies currently?
2. What are the benefits?
3. What are the risks involved?
4. Do the benefits outweigh the risks? This probably depends who you ask.

That is very broad yet some people try to limit their reliance on fossil fuels for environmental and economic reasons. Unfortunately we are all hypocrites in some ways.

inzider's picture
inzider's picture
inzider commented Wednesday, 12 Oct 2016 at 12:42pm

1-No hence BP pulling out of high expenditure exploration.
2-Benefits of exploration =fuck all but those involved with drilling
3-Risks are obvious, but fearmongering from Deepwater horizon is just stupid.
4- I agree

I live on a NZ west coast with good waves good fishing , wildlife etc and there have been rigs drilling here in deepwater for nearly 50 years. We had a small spill once by an ozzie company and they fixed it by sponsoring an ASP event. Irony much

I dont think they will drill in the bight until the price of oil goes mental again, which could be never.

tonybarber's picture
tonybarber's picture
tonybarber commented Wednesday, 12 Oct 2016 at 12:55pm

Inzider, I don't think this about anti oil drilling as such but rather the location. Add to that how BP handled the oil issue in the Gulf of Mehico. That issue is still going of course.
Location and mitigation procedures are paramount. The price of oil will go 'mental' one day but that will be another issue. There is no hyprocisy, really.

stunet's picture
stunet's picture
stunet commented Wednesday, 12 Oct 2016 at 2:10pm

I don't give too much credit to the "we're all hypocrites" argument either. For one, many people do limit their reliance on fossil fuels, however the greater point is that the only way we'll wean ourselves off fossil fuels - and at heart that is what this argument is about - is via government legislation and market pressure. Individual actions will never amount to much beyond good vibes and self-pride. No matter how much power Bryce Courtenay says we have, individuals can't change the world anymore than industry can regulate itself.

So the impetus for change has to come from elsewhere and that's where legislation and market pressure comes to bear. By being active - civil disobedience, letter writing, protesting, speaking up about dodgy shit, whatever... - people can force the issue so govts legislate and roll the status quo.

The other issue is this: are there alternatives to oil? Of course there are. There's simply never been a need for R&D when great concentrations of wealth are made by simply popping zits in the Earth's crust, and if you believe the alt-media sites whatever R&D happens is swiftly purchased by oil companies and put on ice. Conspiracy? Go read about DuPont's hand in outlawing hemp. Out with natural sustainable fibres, in with Nylon!

Like many other 20th century empires the cracks are showing in the oil companies. Their tendrils are visible throughout society and it's slowly becoming clear we've been egregiously manipulated into believing there's no other path. Meanwhile, outsiders, disruptors, whatever Gladwell-esque term you want to use, are meshing science and business in direct competition to oil companies. Think Tesla for cars, or as you mentioned wetsuits, think Patagonia and Yulex rubber. The options are there and they'll only grow.

But yeah, it'll take a while, decades perhaps. However, undertaking risky projects is needless when there's another way - maybe even many other ways. I'm a firm believer that solutions are available and it's only company connivance holding us back.

Reckon that's enough earnestness for one day...

lostdoggy's picture
lostdoggy's picture
lostdoggy commented Wednesday, 12 Oct 2016 at 2:20pm

Well said.

Gary G's picture
Gary G's picture
Gary G commented Wednesday, 12 Oct 2016 at 2:23pm

Gary would like your thoughts on whether it's company connivance holding us back, or do you think that the core components of the solutions offered simply have no business calling themselves Elite(TM) and should do more One Legged Squats?

I'm high on the hill, looking over the bridge,
To the Gary-G.
And way up on high, the wave I can see,
is a sweet facey

stunet's picture
stunet's picture
stunet commented Wednesday, 12 Oct 2016 at 2:39pm

I think the solution to that, in fact the solution to most things, is more whey protein.

Drink up, brawn boy.

lostdoggy's picture
lostdoggy's picture
lostdoggy commented Wednesday, 12 Oct 2016 at 2:44pm

They decided to stick to the States as Australia doesn't have an 'elite' environment.

Gary G's picture
Gary G's picture
Gary G commented Wednesday, 12 Oct 2016 at 2:25pm

'Ain't nobody gonna stop Gary G from drilling in the bight' is the t-shirt slogan Gary had made from his last jaunt across the Nullabor.

I'm high on the hill, looking over the bridge,
To the Gary-G.
And way up on high, the wave I can see,
is a sweet facey

surfingbymyself's picture
surfingbymyself's picture
surfingbymyself commented Thursday, 13 Oct 2016 at 12:34pm

Any brand damage from your drilling Gary?

Gary G's picture
Gary G's picture
Gary G commented Thursday, 13 Oct 2016 at 2:49pm

Nah, Surfingbymyself, It's right in line with everything Gary's brand represents

I'm high on the hill, looking over the bridge,
To the Gary-G.
And way up on high, the wave I can see,
is a sweet facey

AndyM's picture
AndyM's picture
AndyM commented Thursday, 13 Oct 2016 at 2:57pm

"BP withdraws from Great Australian Bight drilling"

When was the last time you prematurely withdrew from something G Love?

batfink's picture
batfink's picture
batfink commented Wednesday, 12 Oct 2016 at 2:55pm

Apropos nothing much at all, Australia is earning virtually nothing out of the north west gas fields.

That's right, we're literally giving it away. Our esteemed overlords devised a system whereby the company gets to write off so much expenditure that we aren't earning royalties, taxes, nothing.

So why would we want any company to come in and take our oil away? Forget environmental and climate change issues, what's the bleeding point from our perspective.

As a reference to Inzider's comments, there is currently a world oil glut. If oil is being produced elsewhere, where is the hypocrisy in our using it. Why do we become hypocrites unless we are pumping oil ourselves. We haven't been self-sufficient in oil since the 70's.

inzider's picture
inzider's picture
inzider commented Wednesday, 12 Oct 2016 at 4:41pm

To get big oil to invest 100's of billions of dollars in places like barrow island, wheatstone, curtis island, darwin etc they want a few tax breaks. The amount of employment created by these projects is huge, all the workers on good loot are paying a shit ton of tax. The stimulus to the oZ economy from these projects is huge.

The old chestnut of overseas oil companies stripping wealth is nothing new.
In NZ we became almost self sufficient from govt started and funded exploration and production companies. Then the oil crisis was over and the next govt sold it all for fuck all.

There has been a glut of oil for a long long time. It was OPECS desire to slow down the supply of oil to crush high cost extraction from shale in the US. it worked sort of.

My point about hypocrisy is about not complaining when someone wants to drill in your back yard if you are prepared to keep filling your tanks from someone elses backyard.
BP spent a shit ton building a specific rig for this bight project. 100's of millions.
Now with the oil market so up the fuck they aint going near the bight for a long time I would guess.

stunet's picture
stunet's picture
stunet commented Wednesday, 12 Oct 2016 at 4:58pm

You read much about Norway's Government Pension Fund, Inzider? Biggest pension fund in the world. Nearly a trillion bucks in govt coffers thanks to savvy control of the Norwegian gas fields by the government.

Makes me wonder why the hell we couldn't do it. Why our public/private partnerships put so much emphasis on the private when the Norwegians do the reverse and set up their country for generations to come. They upped the licenses and reduced the JV share, and yet the oil companies didn't run a mile as we're regularly told they would if we dared raise our taxes.

velocityjohnno's picture
velocityjohnno's picture
velocityjohnno commented Wednesday, 12 Oct 2016 at 5:03pm

It was brilliant. They are beginning to draw a bit on the capital now I think. Closest we got was Costello's future fund (Federal public servants pensions) once the debt levels were repaid. Has that been raided since?

inzider's picture
inzider's picture
inzider commented Wednesday, 12 Oct 2016 at 5:25pm

OZ could have done it, but you need a political system that accommodates some brains I guess.
Following the capitalist mode of production dosnt help.
Norway arnt following blindly behind the core nation states. They still own a 30 percent of their companies.

A Salty Dog's picture
A Salty Dog's picture
A Salty Dog commented Friday, 13 Oct 2017 at 1:24pm

In the early seventies under the Whitlam Govt the Minister for Minerals and Energy, Rex Connor, had an idea.

Read about it here : https://en.wikipedia.org/wiki/Rex_Connor

While his financing methods may have been questionable there is no doubt that had the foresight to set the country up for a prosperous future by developing the North West Shelf Project.

Never once in my lifetime have I seen the Liberal Party/ Nationals plan for anything beyond the next election that would be of benefit to the country as a whole.

The LNP claim to be the superior economic managers but they have time and time again sold us out to international interests.

Had Connor's plan been implemented we would not be in the mess we are today.

Fuck the Liberal/National Party.

velocityjohnno's picture
velocityjohnno's picture
velocityjohnno commented Wednesday, 12 Oct 2016 at 4:20pm

$40-$50USD a barrel does this. As the USD oil price chart does what...? (I'd love to say but some might misconstrue as financial advice)

Otherwise, you can depart oil without lobbying through getup. 2011-14ish Commodores run on E85 and are depreciating fast. Teslas might exist, but other electric cars at cheaper prices do and more will come. Solar on roof. Battery banks. Food might come by diesel truck if you don't grow it yourself, but in Australia we could use the coal with Fischer Tropsch, or grow algae or use waste products, or even CNG/LPG the nation's diesel truck fleet... or use more rail. All this might mean more expensive products from shelves to your household.

Extra question: I think there was a thread many years ago on Swellnet about there being 100 foot waves, and conditions in the North Sea were measured with at least one of these. The rigs there must be designed to take fairly extreme conditions.

cheeryohreally's picture
cheeryohreally's picture
cheeryohreally commented Wednesday, 12 Oct 2016 at 5:04pm

Depths that BP was looking at drilling were around 2,500m - ultradeepwater which comes with greater risks, complexity and cost. Bass straight and most offshore rough water areas (north sea) are in more shallow waters and closer to more technology and solutions to cap spills. This spot is remote, rough and deep.

inzider's picture
inzider's picture
inzider commented Wednesday, 12 Oct 2016 at 5:28pm

Granted , it is one spot on earth they need the latest and greatest tech

stickyson's picture
stickyson's picture
stickyson commented Wednesday, 12 Oct 2016 at 6:23pm

Might be sooner than you think. Russia seems to have jumped on the bandwagon for reducing output
http://ab.co/2dbr1ei

inzider's picture
inzider's picture
inzider commented Tuesday, 3 Jan 2017 at 11:49am
udo's picture
udo's picture
udo commented Friday, 9 Jun 2017 at 3:02pm

Looks like Norwegian company Statoil are gonna have a go in the Bight

Craig's picture
Craig's picture
Craig commented Friday, 13 Oct 2017 at 9:59am