BP has cancelled its ultra-deepwater exploration drilling programme in the Ceduna sub-basin of the Great Australian Bight (GAB), offshore South Australia.
The move comes after completion of a review of the company’s upstream strategy earlier this year, which included focusing exploration on opportunities that may create value in the near to medium term.
BP said that the GAB project will be unable to compete for capital investment with other upstream opportunities in its global portfolio in the long run.
BP exploration and production managing director Australia Claire Fitzpatrick said: "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.
“This decision isn’t a result of a change in our view of the prospectivity of the region, nor of the ongoing regulatory process run by the independent regulator NOPSEMA. It is an outcome of our strategy and the relative competitiveness of this project in our portfolio.”
BP has informed federal and state governments of its decision, and also consulted with its joint venture partner, Statoil.
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Fitzpatrick further added: “BP is a long-term, significant investor in Australia, most visibly through our retail network and refinery and also as partners in the North West Shelf and Browse ventures.”
In January 2011, BP secured exploration licences for four blocks in the Ceduna area of the GAB and acquired seismic data in this area in late-2011 to early 2012.
In 2013, Statoil acquired a 30% interest in the licences, while BP remained operator holding 70% interest.
In the same year, BP signed a contract for Diamond Offshore’s harsh environment ultra-deepwater Ocean GreatWhite rig, and proposed to use it on the GAB campaign.
BP and Diamond are exploring alternative locations for the rig. BP’s decision will not impact the rig contract.
Image: BP’s GAB project will not be able to compete for capital investment with other upstream opportunities in its global portfolio. Photo: courtesy of BP plc.