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BP scraps plan to drill off Australia's south coast
October 11, 2016 / 2:37 AM / a year ago

BP scraps plan to drill off Australia's south coast

MELBOURNE, Oct 11 (Reuters) - BP Plc has abandoned plans to drill for oil and gas off the south coast of Australia, saying it can get better value for its exploration spending elsewhere, although it still sees strong potential in the Great Australian Bight.

The decision comes as a win for environmental groups, like Greenpeace, which have heavily opposed drilling off the coast of South Australia, saying it would damage a marine sanctuary, including whale breeding grounds.

BP said the Bight project, where it has been working with Norway’s Statoil, would not be able to compete for capital investment with other opportunities in its global portfolio in the foreseeable future.

“This decision isn’t a result of a change in our view of the prospectivity of the region, nor of the ongoing regulatory process,” BP’s head of exploration and production in Australia, Claire Fitzpatrick, said in a statement.

“It is an outcome of our strategy and the relative competitiveness of this project in our portfolio.”

BP said Statoil, a 30 percent partner in the exploration licenses for four blocks in the Great Australian Bight, had accepted its decision.

Others with exploration permits in the region include Chevron Corp, and Murphy Oil working with Santos .

The Australian Petroleum Production and Exploration Association said earlier this year the Great Australian Bight could be an imporant new oil province and key source of new jobs, with the industry potentially looking to spend more than A$1 billion ($760 million) on exploration alone off South Australia.

$1 = 1.3187 Australian dollars Reporting by Sonali Paul; Editing by Richard Pullin

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