APPEA 2008 Conference Update

The APPEA 2008 Conference is on in Perth this week - this is a roundup of the press commentary today (or yesterday, by the time you are likely to read it).

ABC - More than 2,000 oil and gas experts gather in Perth

Representatives of the oil and gas industry will discuss ways to tackle the challenges of reducing greenhouse gas emissions, making workplaces safer and addressing the skills shortage at a conference in Perth today. More than 2,000 people associated with the oil and gas industry are meeting to discuss new demands and challenges facing the industry in Australia and overseas.

The Australian Petroleum Production and Exploration Association (APPE) expects world energy demand to increase by 40 per cent by 2030. The chief executive of APPE, Belinda Robinson, says the industry needs to devise ways to meet the growing energy demand while still achieving reductions in greenhouse gas emissions. "If we can triple our LNG production on the basis that most of that goes to the Asia Pacific region we will be helping the Asia Pacific region reduce its greenhouse footprint," she said.

The Australian - Security a crucial issue at gas talks

NATIONAL and international energy security is expected to be a key issue at a major oil and gas conference beginning in Perth today. ... While industry heavies from across the world, including Royal Dutch Shell executive director gas and power Linda Cook, BHP Billiton Petroleum president Michael Yeager and senior US energy department official Jim Slutz, will be attending, much of the domestic industry's interest will lie in domestic issues.

The new federal Energy Minister, Martin Ferguson, is expected to take up points he has made to industry meetings recently that the Rudd Government is keen to cut red tape and that it wants to encourage investment in an internationally competitive industry. Mr Ferguson is expected to argue in a keynote address that Australia is on the threshold of developing an energy province in the Browse Basin north of Broome which will be important not only for Australia, but internationally, as a major contributor to reducing greenhouse gas emissions in Asia. ...

APPEA has been leading the campaign against replacing the current retention lease regime -- a proposal put forward last year by the Howard government as a sop to the West Australian Government following its controversial policy of demanding that export LNG project proponents quarantine 15 per cent of their reserves for future domestic consumption. APPEA chief executive Belinda Robinson believes the issues facing the oil and gas sector centre on: declining oil production, both in Australia and globally; increasing energy demand, particularly in the Asia-Pacific; growth in energy nationalism and the emergence of government oil companies setting agendas; and higher environmental consciousness in the community leading to concerns about energy's contribution to greenhouse gas emissions. ...

APPEA has a target of encouraging at least 70 per cent of new electricity generating stations constructed in Australia to be fuelled by natural gas by 2017. ...

Onshore exploration in Australia has declined dramatically in recent years and there are large areas of the country which remain under-explored.

SMH - Govt gets serious on offshore petroleum

The federal government has put 35 offshore areas up for grabs for petroleum exploration. The released commonwealth areas are located across five basins off the Northern Territory, Western Australia, and the Territory of Ashmore and Cartier Islands coastlines.

The news comes as the minister warned Australia faces a $25 billion trade deficit in petroleum products by 2015. While new oil projects including Enfield, Puffin and Stybarrow would help address the issue, Mr Ferguson said he was keen to see exploration in frontier basins as they were the most likely place for a large new oil province to be discovered.

Bloomberg - Australia Needs to Boost `Frontier' Oil Exploration, Group Says

Australia's oil explorers need to widen their search for discoveries in so-called frontier areas to avoid a A$28 billion ($26 billion) petroleum trade deficit within a decade, the nation's oil and gas industry group said.

Australia has 50 sedimentary basins, of which just 12 are producing oil and gas, pointing to potential for drilling in little-explored areas, said Belinda Robinson, chief executive officer of the Australian Petroleum Production and Exploration Association. Four basins have been deemed non-commercial.

Crude-oil production in Australia dropped about 3 percent last year to 120 million barrels, contributing to a A$13.7 billion petroleum trade deficit, up from A$900 million in 2000, according to the industry group. Spending on exploration jumped 57 percent last year to a record A$2.66 billion even as the number of wells drilled fell as equipment and labor shortages drove up costs. ...

In the absence of finding a ``major new oil province,'' Australia will be importing 80 percent of its requirements for oil and refined products by 2015, up from about 20 percent in the 1990s, Resources and Energy Minister Martin Ferguson said in February.

Bloomberg - Australian Minister Warns Oil, Gas Explorers May Lose Leases

Oil and gas companies hunting for oil and gas in Western Australia risk losing rights to petroleum leases if they don't commit to moving forward with developments, a Western Australian minister said.

Eighteen petroleum leases in Western Australia are set to expire this year, Western Australian Deputy Premier and Minister for State Development Eric Ripper said today at the Australian Petroleum Production and Exploration Association annual conference in Perth. If companies don't commit to work programs to move forward with projects ``there could be opportunities for other investors to take those over,'' Ripper said.

Bloomberg - Australia Seeks Bids for 35 Oil, Gas Drilling Permits

The permits in the 2008 auction are located in the Bonaparte, Browse and Carnarvon Basins off the northwest coast and in the Perth Basin off the southwest. Bids for 17 of the permits close on Oct. 9, with the remaining 18 areas closing on April 9, 2009. Under Australia's oil and gas exploration permit system, licenses are awarded to the bidder that pledges to carry out the most exploration in the area. Separately, the South Australian government invited bids for three new onshore oil and gas exploration permits in the Otway Basin.

Herald Sun - Industry plans to hit the gas

the minister warned Australia faces a $25 billion trade deficit in petroleum products by 2015.

Dear Minister,

We could always just use less.


If we ..triple our LNG production.. we will .. reduce.. greenhouse footprint

Not unless it replaces coal burning ie when an Asian LNG terminal goes up a coal fired power station gets bulldozed. Perhaps if customers were 'entitled' to use more coal but used LNG instead that is less emissions than they were 'entitled' to. All Mother Nature knows is that emissions are still increasing.

This is the kind of daft argument that will be used to bamboozle the ETS. I don't understand the rush to give away our precious gas. The Brits did that with North Sea gas and now they are stuffed.

It is certainly a sign of the times when such vast areas under Commonwealth control are brought to market for exploration. In our want for life as usual we will go to any lengths to get the energy we need. Damn the subsistance, lets open the coal belt that runs under Sydney to long wall mining, that should make up some of the energy shortfall.
On a different note can anyone shed any extra light on the Bakken formation in North America? I have heard various claims as to the size and types of oil formations there are. From 508 billion barrels of light sweet crude to 200 billion of recoverable from oil shale.
I'm sure some of you out there have a better understanding than a punter like me. Thanks guys.

I've asked for someone to do a proper analysis of the Bakken as a TOD main post.

See the Lou Grinzo post I point to here for one of the better pieces I've seen so far :

Thanks Big Gav. Energy and Capital seems to think it's reserves are in the higher range and are recommending it in their portfolios. I'll hold onto my cash for now!

Apparently a new USGS assessment is out Thursday (see the links I added to the PE post).