OFFSHORE PETROLEUM EXPLORATION
ACREAGE RELEASE  AUSTRALIA 2014
Australia – a great place to explore
Australia's economic performance is among the best in the
world and the outlook remains positive. Australia's diverse,
multicultural society has a very high standard of living and
a long-standing, democratic culture based on the rights of
the individual and the rule of law. Australia is politically
stable and enjoys a high degree of social harmony that is
among the best in the world.
Australia is an attractive investment location with abundant
energy resources for development and export, a stable
business environment with active participation by some of
the largest multinational companies in the world, close
proximity to the major demand markets of Asia and access
to a highly skilled workforce and innovative technologies.
There are no government-owned resources companies
and no requirement for government participation in
resources projects. The Australian Government does not
apply export controls to liquefied natural gas (LNG)
projects.
With a regulatory framework that keeps pace with financial
market developments, Australia possesses an
internationalised currency, no foreign exchange controls,
and a highly effective intellectual property rights regime.
With a Gross Domestic Product (GDP) of US$1.5 trillion,
Australia is the 12th largest economy in the world and the
4th largest in the Asia region. Australia has enjoyed many
years of uninterrupted economic growth, including during
the global financial crisis of 2008. Since a brief recession
in 1991, the Australian economy has experienced an
average GDP growth of 3.3 per cent per annum. This
annual growth is forecast to continue to 2017-18.
The Australian economy has continued to prove its
resilience throughout the global financial crisis. Sound
macroeconomic policies and structural reform during this
time increased Australia’s responsiveness to shifts in the
global economy and enabled Australia to better withstand
global economic pressures to maintain strong economic
fundamentals.
www.petroleum-acreage.gov.au
In terms of real GDP, Australia’s economic growth in
2012-13 was 2.6 per cent and is forecast to reach 2.7 per
cent in 2013-14. Recent economic data suggests that
domestic production for key commodities will increase
consistently over the next few years as Australia begins
the transition from the construction phase to the
production phase, with a corresponding robust growth in
export volumes and export earnings.
Australia continues to be an attractive destination for
transnational corporations and in 2013 was the eleventh
largest recipient of foreign direct investment (FDI) inflows
in the global economy. According to the United Nations
Conference on Trade and Development, FDI inflows to
Australia in 2013 totalled US$40 billion.
Australia has been rated the third freest economy in the
world by The Wall Street Journal 2014 Index of Economic
Freedom. The index tracks the progress of economic
freedom around the globe and provides evidence of
dynamic gains from greater economic freedom. From
186 economies, Australia ranks third behind Hong Kong
and Singapore. The survey states that Australia continues
to set the standard for clean, corruption-free government
and benefits significantly from its transparent and efficient
business environment, and open-market policies.
Australia is building on its position in the Asia-Pacific
region and has an established a network of Free Trade
Agreements (FTAs) with key trading partners in the region.
Australia currently has seven FTAs currently in force with
New Zealand, Singapore, Thailand, US, Chile, the
Association of South East Asian Nations (ASEAN) (with
New Zealand) and Malaysia. The countries covered by
these FTAs account for 28 per cent of Australia's total
trade. Further information is available at
http://dfat.gov.au/fta/index.html.
1
DISCLAIMER: This fact sheet has been developed as a guide only. It does not replace or amend information provided in the Offshore Petroleum Legislation, Regulations and
Guidelines available at: www.nopta.gov.au/legislation. In the event that there is a discrepancy between this fact sheet and the legislation or regulations, the legislation or regulations
have precedence. Explorers should not rely solely on this information when making commercial decisions. Image courtesy of BHP Billiton Petroleum Pty Ltd.
General facts – Australia
Area (kilometres2)
13 590 000 (land area – including Australian Antarctic Territory of 5 900 000)
Offshore marine
jurisdiction
(kilometres²)
Population (million)
14 620 000 (marine area – including the Exclusive Economic Zone, Territorial Sea and
Extended Continental Shelf)
Official Language
English
GDP (current prices)
US$1 488 billion (2013 exchange rates)
GDP per capita
(Current Prices)
Capital
US$64 157 (2013 exchange rates)
Main Cities
Sydney (4.6m), Melbourne (4.1m), Brisbane (2.0m), Perth (1.7m), Adelaide (1.2m),
Hobart (0.2m), Darwin (0.1m),
System of Government
Federation (Commonwealth) of:
23.0
Canberra (population 0.38 m)

six states – New South Wales, Queensland, South Australia, Tasmania, Victoria and
Western Australia;

three mainland territories – the Northern Territory, the Australian Capital Territory and
the Jervis Bay Territory; and
seven external territories – Ashmore and Cartier Islands, Australian Antarctic Territory,
Christmas Island, Cocos (Keeling) Islands, Coral Sea Islands Territory, Heard and
McDonald Islands and Norfolk Island.
Parliamentary democracy based on Westminster system; Federal Parliament consisting
of House of Representatives and Senate.


Key offshore petroleum statistics
2008-09
2009-10
2010-11
2011-12
2012-13
Employment Oil and Gas Extraction
14 200
17 800
12 300
15 000
23 700
Offshore Exploration Expenditure ($m)
3 318
2 746
2 559
2 277
2 638
Industry gross value added ($m)
27 118
27 375
28 724
27 749
31 281
Exports Oil and Gas Extraction ($m)
19 379
17 852
22 443
24 102
25 192
Imports Oil and Gas Extraction ($m)
17 008
16 346
21 614
23 554
23 112
Active Offshore Exploration Permits
215
216
214
210
219
Source: ABS 5204.0, ABS 5368.0, ABS 6291.0.55.003 and ABS 8412.0.
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Why explore for oil and gas in Australia?
The probability of finding a new petroleum province in
Australian waters remains high.
Some attributes that make Australia an attractive location
for offshore oil and gas exploration include:

The first Australian exploration permit was granted in 1959
in the Gippsland Basin. As at February 2014, there are
currently 210 offshore exploration permits, 54 retention
leases and 92 production licences. From the first oil and
gas discoveries in Bass Strait, the North West Shelf and
the Timor Sea through to more recent discoveries in the
Carnarvon and Browse basins, there is no doubt that
offshore Australia is one of the world’s most highly
prospective areas for petroleum.
the regular release of new exploration acreage
covering a range of regions from mature to frontier;

access to high quality geoscientific data and analysis

continued government support of pre-competitive
geoscientific exploration, data acquisition and analysis;

a free market philosophy which welcomes foreign
investment – Australia has no mandatory local equity
requirements and no government-owned petroleum
companies;
Australia is a gas-rich nation. According to the Australian
Energy Resources Assessment, around 92 per cent of
Australia’s 158 trillion cubic feet of known conventional
natural gas resources are located in the Carnarvon,
Browse and Bonaparte basins off the north-west coast of
Australia. Known gas resources are also located in southwest, south-east and central Australia, along with large
coal seam gas resources in the coal basins of Queensland
and New South Wales and the potential for shale and tight
gas resources in South Australia, Western Australia and
the Northern Territory. Despite this, much of the continent
and its offshore areas remain underexplored, and in some
areas unexplored, with over 40 onshore and offshore
basins awaiting in-depth exploration to determine their full
potential.

close proximity to markets in the growing economies of
the Asia-Pacific;

an attractive policy and legal framework for oil and gas
development, conducive to companies of all sizes;

security of title with the right to retain and/or develop a
discovery, subject to meeting the specified terms of a
retention lease or a production licence;

transparent and practical regulatory requirements
covering all stages of petroleum operations;

expanding physical infrastructure, sophisticated
technical and services support, a highly educated
workforce and pool of skilled petroleum professionals;

an internationally competitive profit-based tax system;

government assistance with project facilitation,
In 2008, the United Nations Commission on the Limits of
the Continental Shelf (UNCLOS) confirmed the location of
the outer limit of Australia’s continental shelf, which
resulted in the extension of Australia’s jurisdiction over an
additional 2.56 million square kilometres (km2) of seabed.
Australia now has more than 14.62 million km2 of
maximum seabed territory, which is in the top three largest
marine jurisdictions in the world along with the United
States of America and France. Australia is now custodian
to around 4 per cent of the world’s total seabed, an area
with significant untapped exploration potential.
Australia's geographic location ensures it is well placed to
meet the rapidly expanding energy needs of the
Asia-Pacific region.
The strong consumption growth of oil in non-OECD
markets and the sound outlook for LNG in the Asia-Pacific
region, together with relatively resilient petroleum prices,
provide the economic drivers for ongoing investment in
exploration in Australia. Increased demand for energy with
the industrialisation of China and India, and other
emerging Asian economies, underpins these positive
market conditions.
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AUSTRALIA 2014
at low or no cost;
including fast-tracking of approvals processes for
declared major projects; and

an open and competitive economy, including
deregulated banking and foreign exchange
arrangements, a sophisticated capital market and a
good record of industrial harmony.
Australia – a resource rich nation with
further growth potential
Australia has an enviable history in the successful
development of its abundant natural resources.
According to the Australian Bureau of Resource and
Energy Economics (BREE), Australia’s energy and
mineral commodity resource export earnings totalled
$176 billion in 2012-13, with energy exports accounting for
$69 billion or 39 per cent of this total.
Export earnings in 2013-14 are expected to increase by
17 per cent due to robust growth in both mineral and
energy commodity export volumes and a lower Australian
dollar. Energy export earnings are forecast to increase by
9 per cent to $75 billion, underpinned by higher earnings
from LNG (up 15 per cent) and metallurgical coal (up 6 per
cent).
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Australia has over 300 crude oil fields with most
production coming from six major basins: the Carnarvon,
Browse, Bonaparte and Perth Basins offshore Western
Australia and the Gippsland and Bass Basins off
south-eastern Australia.
Australia’s identified oil resources have been estimated at
5 338 million barrels (mmbl), made up of 1 264 mmbbl of
crude oil; 2 733 mmbbl of condensate; and 1 341 mmbbl
of liquefied petroleum gas (LPG).
In 2012-13, Australia’s exports of crude oil and
condensate declined slightly by volume (year on year) to
118 million barrels. The value of exports fell marginally to
A$12.5 billion due to softer global oil prices.
Production is forecast to increase by 2.4 per cent by
volume in 2013-14 following the scheduled start-up of
several new smaller projects, with a rise in value of 14 per
cent to $14.2 billion. A significant rise in production is
forecast from 2017 with the commencement of
condensate production associated with the Prelude and
Ichthys LNG projects.
In 2012-13, Australian exports of LPG and petroleum
refinery products totalled approximately 13.3 mmbbl and
7.3 mmbbl respectively.
Global trade for LNG has more than doubled in the past
decade. In 2013, Australia exported 24 million tonnes (mt)
of LNG, overtaking Indonesia to become the world’s third
largest LNG exporter. Exports volumes are projected to
increase at an average annual rate of 36 per cent to reach
90 mt by 2017-18.
Current production is supported by Australia’s world-class
LNG export facilities that utilise the large quantities of
natural gas found off Australia's north-west coast.
In addition to our three operating projects (North West
Shelf, Darwin LNG and Pluto Train 1), Australia currently
has seven LNG projects under construction with capital
expenditure of over A$180 billion including three
conventional gas-based projects: the Gorgon project
(15.6 mtpa), the Wheatstone project (8.9 mtpa), and the
Ichthys project (8.4 mtpa); the Prelude floating LNG
project (3.6 mtpa); and three coal seam gas-based LNG
projects: the Queensland Curtis LNG project (8.5 mtpa),
the Gladstone LNG project (7.8 mtpa), and the
Australia-Pacific LNG project (9.0 mtpa).
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AUSTRALIA 2014
Realising Australia’s petroleum potential
Offshore petroleum exploration
Australia has the potential for further discoveries of oil and
gas with many offshore basins remaining largely, or
entirely, unexplored. This potential has been grasped by
companies with around $2.6 billion spent on private
offshore petroleum exploration in Australia in 2012-13.
Only around 20 per cent of Australia’s offshore basins are
currently covered by petroleum titles. Although exploration
activity is primarily focused on finding resources close to
existing discoveries to improve the economics of proposed
projects, frontier exploration is growing. Australia’s
underexplored frontier basins hold the greatest promise of
making a major new discovery. To encourage exploration
in these areas and help reduce the risk of exploration,
Geoscience Australia through Australia’s Offshore Energy
Security Program has undertaken a series of programs
aimed at providing pre-competitive and geological
information aimed at improving the understanding of the
petroleum prospectivity and resource potential of frontier
basins.
In general, offshore petroleum exploration activity in
Australia has remained steady in recent years.
Offshore petroleum development
The Australian petroleum industry is entrepreneurial,
innovative and has achieved significant success as recent
development projects under consideration and under
construction show (see below table). It is made up of a
number of small, medium and large companies, many of
whom operate on the international scene. Australia's
modern legal framework, petroleum tenement system,
favourable taxation regime and economic environment
explain Australia's consistent high ranking in international
investment surveys.
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Australia’s LNG development projects
Project
Participants
Location
Basin
Plant
Targeted
Start up
LNG
Capacity
(Mtpa)
Capital
Cost
(A$)
Woodside, Shell, BP,
Chevron, BHP Billiton,
MIMI, CNOOC (gas
and associated liquids)
WA
Existing
16.3 mtpa
5 trains
$27b
(2009 $)
ConocoPhillips, ENI,
Santos, INPEX, Tokyo
Gas & TEPCO
NT
3.6 mtpa
$1.75b
Conventional gas
In Operation
North West Shelf
Darwin LNG
Carnarvon Basin
Karratha
Existing
JPDA
1 train
Darwin
Pluto Train 1
Woodside, Tokyo Gas,
Kansai Electric
WA
Existing
Carnarvon Basin
4.3 mtpa
$14.9b
1 train
Karratha
Under construction
Gorgon LNG
Prelude FLNG
Wheatstone LNG
Ichthys LNG
Chevron, Shell,
ExxonMobil, Osaka
Gas, Tokyo Gas,
Chubu Electric
WA
Shell, INPEX, KOGAS,
OPIC
Browse Basin
Chevron, Apache,
Kufpec, Kyushu
Electric, PE
Wheatstone
WA
INPEX, Total, Tokyo
Gas, Osaka Gas, Toho
Gas, Chubu Electric,
CPC Taiwan
WA
2014-15
Carnarvon Basin
Barrow Island
15.6 mtpa
$54b
5 trains
2016-17
floating LNG
2016
Carnarvon Basin
Onslow
1 train
Not
publicly
available
8.9 mtpa
$29b
3.6 mtpa
2 trains
2016
Bonaparte Basin
8.4 mtpa
$34b
2 trains
Darwin
Coal Seam Gas
Under construction
Queensland
Curtis LNG
BG Group, CNOOC,
Tokyo Gas
Gladstone LNG
Santos, Petronas,
Total, KOGAS
QLD
2014
Bowen and Surat
Basins
8.5 mtpa
$20.4b
2 trains
Gladstone
QLD
2014
Bowen and Surat
Basins
7.8 mtpa
$18.5b
2 trains
Gladstone
Australia-Pacific
LNG
Origin, ConocoPhillips,
Sinopec
QLD
Bowen and Surat
Basins
2015
9.0 mtpa
$24.7b
2 trains
Gladstone
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Australia’s domestic gas market
References
The Australian domestic gas industry has strong growth
potential, paralleling growth in the industrial, minerals
processing and electricity generation sectors.
Australian Bureau of Statistics, Cat. 5204.0 - Australian
System of National Accounts, Table 5
In 2012-13, Australia’s total gas production was 63 billion
cubic metres (bcm) or 2 346 petajoules (PJ), an increase
of 13 per cent year on year. Production growth in 2013-14
is forecast to increase by 2 per cent in 2013-14 then
increase substantially once LNG and domestic gas
projects in Western Australian and Queensland
commence production in early 2015. Around half of
Australia’s gas production is exported as LNG with the
remainder meeting domestic demand. Australia’s gas
production is projected to increase at an average annual
rate of 11 per cent over the period 2014-15 to 2017-18.
Over the last 20 years, Australia’s domestic natural gas
industry has grown from a relatively small base of 688 PJ
in 1989-90 to being the third most significant domestic
energy source after coal and oil. In 2012-13, Australia’s
domestic gas production was a record 1 102 PJ, up 4 per
cent year on year. The increasing share of natural gas in
Australia’s energy consumption is expected to continue
with future demand for natural gas estimated to reach
2 575 PJ in 2029-30.
Domestic gas market reform over the past decade has
increased transparency and competition in the sector, as
well as brought industry regulation under the national
energy framework in line with electricity. Ministerial
Council on Energy initiatives such as the National Gas
Law and National Gas Rules, National Gas Market Bulletin
Board and the Short Term Trading Market for gas have
provided a framework for greater transparency and
promoted the use of natural gas for domestic consumption
across Australia.
Australian Bureau of Statistics, Cat. 5368.0 - International
Trade in Goods and Services, Australia, Tables 12 and 13
Australian Bureau of Statistics, Cat. 6291.0.55.003 Labour Force, Australia
Australian Bureau of Statistics, Cat. 8412.0 - Mineral and
Petroleum Exploration, Australia, Table 6a
Australian Petroleum Production and Exploration
Association, State of the Industry 2012
Australian Trade Commission, Investor Update – Data
Alert, 22 January 2014
Australian Trade Commission, 2014 Austrade Benchmark
Report, 15 January 2014
Bureau of Resource and Energy Economics, Resources
and Energy Quarterly, December 2013
Geoscience Australia, Australian Energy Resource
Assessment 2012
Geoscience Australia, Oil and Gas Resources of Australia,
Petroleum Reserves by Basin
United Nations Conference on Trade and Development,
Global Investment Trends Monitor, No. 15, 28 January
2014
Significant expansion and integration of Australia’s
domestic gas transmission and distribution network in
recent years, particularly in south-eastern Australia, has
facilitated growth in established gas markets and
introduced gas into new regional centres.
This is enhancing basin-on-basin competition for the
supply of gas that will be beneficial to gas consumers
while also encouraging the development of new industries
and increasing opportunities for suppliers to
commercialise gas discoveries.
New offshore domestic gas projects are currently under
development in Western Australia and in the Gippsland
and Otway Basins off southern Victoria. In addition, there
are a number of gas pipeline projects underway in South
Australia, Victoria, Queensland and New South Wales
which will further integrate the pipeline network and enable
gas from new upstream developments to be transported to
domestic gas markets as appropriate.
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