Exxon Mobil Corp’s Australian unit will invest more in its Gippsland Basin Kipper field to deliver additional gas, in a move targeted at easing potential supply shortage of domestic natural gas.
Esso Australia will invest an estimated A$400 million (US$291.48 million) in the Southeast Australia-based basin to extract an additional 200 petajoules (PJ) of gas over the coming five years, the top US oil producer said, adding that about 30 PJ will be produced next year, according to Reuters.
Exxon’s decision comes as the country’s regulators warn of a gas shortfall in eastern Australia from 2026.
The ageing Gippsland basin joint venture is operated by Esso Australia in a 50:50 partnership with a unit of global miner BHP Group. The BHP unit will be transferred to Woodside Petroleum if their proposed merger goes ahead this year.
In August last year, BHP Group said it had agreed to sell its petroleum business to Woodside Petroleum in a merger to create a top 10 independent oil and gas producer worth A$38.5 billion (US$28 billion) with growth assets in Australia and the Americas.
BHP’s exit from petroleum, which made up just 5 percent of its annual earnings, speeds up its exit from fossil fuels amid pressure from environmentally conscious investors.
BHP offered no immediate comment on the decision to boost gas production from the Kipper field.
Esso Australia also said it was advancing funding decisions to begin production from the Turrum field in Bass Strait, offshore Victoria.
