PERTH (miningweekly.com) – Norway’s Statoil has inked a swap agreement with petroleum major BP, and will now start exploration in the Great Australian Bight.

BP in October shelved plans to explore the Bight, following a review of the company’s upstream strategy. The company said at the time that the Bight project would not be able to compete for capital with its other upstream opportunities.

Meanwhile, a Senate Inquiry into oil and gas exploration in the Bight in May failed to deliver conclusive results with a majority of its voting members supporting oil and gas activities in the region, subject to robust regulatory standards.

Statoil has now been granted regulatory approval to take over BP’s 70% interest in two exploration permits, giving the company full ownership of the two permits, in exchange for a 30% interest in two other exploration permits.

“We are very pleased to have reached these agreements and found a way forward for our exploration project in the Bight,” said Statoil VP of exploration in Australia, Pal Haremo.

“With this transaction, we have strengthened our position in this promising, unproven basin with a large exploration upside.”

The company will now take time to systematically work through all the preparations to start drilling work, and would be developing operational plans for the license areas.

The Australian Petroleum Production & Exploration Association (Appea) on Friday welcomed Statoil’s plans to explore for oil in the Great Australian Bight, with South Australia director Matthew Doman saying it was pleasing that Statoil was joining the industry group exploring the potential for petroleum development offshore South Australia.

“Statoil is a major player in the global oil and gas industry with operations in Europe, Africa, North America and Brazil. Today’s announcement is good news for South Australia and a vote of confidence in the Great Australian Bight’s potential as an oil producing region,” Doman said.
 
“The economic benefits could be enormous.  While it is very early days, success in the Bight would attract substantial investment to South Australia and see significant local job creation.”