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Dr Kourosh Mehin
Principal Petroleum Resources Adviser
Minerals & Petroleum Regulation
Expenditure
During the 2005/2006 fiscal year, Victoria continued to benefit from increased levels of exploration and development activities in both onshore and offshore tenements. This high level of activity will be continued in 2006/07.
The total exploration/development drilling, seismic data acquisitions and workover operations expenditure in the Victorian offshore and onshore Gippsland and Otway basins reached $144.3 million during this fiscal period. A total of $119 million of which was spent on exploration and appraisal drilling operations and the remaining $25.3 million on acquiring seismic data.
Exploration And Development Drilling
Sixteen wells were drilled in offshore and onshore titles areas of which twelve were exploration and four were appraisal wells as listed in Table-1.
The number of petroleum development wells increased from the pervious fiscal year (2004/05) to a total of nineteen. In the offshore Gippsland Basin, fifteen of these development wells were drilled and completed by Esso/BHP Billiton and four by Anzon Australia.
Oil And Gas Production
The production of crude oil and condensate from the Gippsland Basin has been in gradual decline since the mid-1980s. The Bream, Flounder, Tuna and West Tuna fields now account for nearly one-third of the liquid production from the basin.
Continued infill drilling, field development and production as well as workover operations in the major producing fields has reduced the rate of decline in oil production, currently 83,000 barrels per day (Figure 1).
click on image to enlarge
Table. 1. Exploration wells drilled during 2005/06
Natural gas production is controlled at any time by local market demand. Gas production in Victoria increased in response to access to new markets such as South Australia via the SEAGas pipeline, completed in December 2004.
The winter peak demand in Victoria during 2006 reached 900 million cubic feet per day (Mcft/d), while the average winter demand reached 750 Mcft/d and the average summer demand reached 500 Mcft/d.
Gas from offshore Gippsland Basin currently accounts for more than 95% of Victoria’s gas production and comes from three major fields - Barracouta, Marlin and Snapper fields.
The Minerva gas field in the offshore Otway Basin was developed and brought on stream by BHP Billiton in 2005.
The Casino gas field in the offshore Otway Basin was developed and brought on stream by Santos during March 2006.
Oil And Gas Reserves
Oil Reserves
As of 30 June 2006, some 3.89 billion barrels of liquid hydrocarbon have been produced from Esso/BHP Billiton fields in the licence areas of the offshore Gippsland Basin. The remaining liquid hydrocarbon reserves are estimated 110 million barrels.
The total estimated oil in-place in the undeveloped fields is around 430 million barrels (Mbbls) of which 261 Mbbls are within the Esso/BHP Billiton fields and the remaining 168 Mbbls are within fields held by other companies in the basin.
Gas Reserves
As of 30 June 2006, the remaining gas reserves from the fields developed by Esso/BHP Billiton are about 4.75 trillion cubic feet (Tcf) compared to an initial recoverable reserves of 11.5 Tcf in the basin.
The total estimated gas-in-place in the undeveloped fields is about 5.9 Tcf of which 3.5 Tcf are within the Esso/BHP Billiton fields and the remaining 1.9 Tcf are within the fields held by other companies.
Gas Reserves
By 30 June 2006, the remaining gas reserves from the developed fields (Minerva and Casino) in the offshore Otway Basin (Port Campbell region) are about 350.7 billion cubic feet (Bcf) compared to an initial recoverable reserves of 410 Bcf.
The total estimated gas reserves in the undeveloped fields in the offshore Otway Basin (Victoria and Tasmania) are about 1.5 Tcf, of which 626.6 Bcf is in the Victorian offshore Otway Basin fields and 888 Bcf in the offshore Bass Basin fields in Tasmanian administrated waters.
Gas Reserves
Gas production from the onshore fields has ceased due to depletion. The undeveloped gas fields in the onshore region are Grumby and Langley with estimated recoverable reserves of about 6 Bcf.
Underground Gas Storage
The Iona gas field is located approximately 8 km northwest of Port Campbell in south-western Victoria. It is the first field in the State to be converted to underground natural gas storage in mid-1999 (by TXU) in order to meet Victoria’s heavy demand for gas during winter. The field has been operated by TRUenergy since June 2005.
As of 30 June 2006, a total of 3.9 Bcf of natural gas have been injected and about 10.3 Bcf of gas were extracted from the field. Figure 2 shows the cycle of production/injection since 1999.
Petroleum Tenement Activities
The 2004 gazetted offshore blocks V04-1 and V04-2 and the near-shore V04-1(v) block in the Otway Basin were awarded as petroleum exploration permits VIC/P61, VIC/P62 and VIC/P41(v) respectively (see details on permit operator and holders on page 20).
• The Petroleum Retention Lease VIC/RLl
covering the Mulloway oil field in the offshore
Gippsland Basin was renewed for five years
on 14 September 2005.
• The Petroleum Retention Lease VIC/RL4
covering the Sunfish oil and gas field in the
offshore Gippsland Basin was renewed for
five years on 6 April 2006.
• The application for retention lease PPL2 (over
much of Petroleum Exploration Permit
PEP157) in the onshore Gippsland Basin was
received from PetroTech Pty Ltd on 24 April
2006 and is currently under consideration.
• Basker-Manta Production Licence VIC/L26
was granted to Anzon Australia Ltd in October
2005.
• Kipper Production Licence VIC/L25 was
granted to Esso Australia Resources Pty Ltd,
BHP Billiton Petroleum (Victoria) and Santos
Offshore Pty Ltd on 17 July 2006.
• The Naylor field in the onshore Otway Basin
covered by Petroleum Production Licence
PPL10 was partially transferred to C02CRC
Pilot Project Ltd as a new production licence,
PPL13, on 7 February 2006. |
