Sydney (Platts)--21Apr2008

The United Nations Commission on the Limits of the Continental Shelf in
New York has confirmed Australia's jurisdiction over an additional 2.5 million
sq km of seabed, giving it rights to any oil and gas resources that might be
found in an area almost five times the size of France, federal Minister for
Resources and Energy Martin Ferguson said Monday.
The Commission's findings confirm the location of the outer limit of
Australia's continental shelf in nine distinct marine regions and Australia's
entitlement to large areas of shelf beyond 200 nautical miles, the government
added.
"This is a major boost to Australia's offshore resource potential,"
Ferguson said in a statement. "In many respects Australia has also led the way
for other countries looking to confirm their continental shelf boundaries
through the Commission. The government will move quickly to proclaim the outer
limits of the Australian continental shelf into law on the basis of the
recommendations of the Commission."
The news was welcomed by Australia's upstream oil and gas industry. "An
expansion of Australia's seabed territory means a larger canvas on which the
current generation of Australians can paint our resource and energy future,"
Australian Petroleum Production & Exploration Association Chief Executive
Belinda Robinson said in a statement Tuesday.
"With more area to explore for new oil and gas reserves comes more
promise," she added. "We really know very little about the petroleum
prospectivity of these areas and increasing that knowledge will be challenging
as will encouraging explorers into these areas, but it is a very exciting
prospect."
The extensions of Australia's continental shelf take in the Wallaby and
Exmouth plateaus, the Great Australian Bight and the Lord Howe Rise,
encompassing areas considered by Geoscience Australia to hold petroleum
promise.
Robinson said one of the great advantages Australia has over other
"mature" oil-producing regions is that less than a quarter of its 50 potential
petroleum basins have been explored.
"Yesterday's announcement leaves a lot of unexplored territory that may
produce the next Australian oil and gas province," she added. "The challenge
for Australia is to persuade potential investors to risk money here rather
than elsewhere. This requires a two-pronged approach. The first is to ensure
the availability of baseline geological information. The second is to ensure
that the fiscal framework takes account of the high costs and high risks
involved in exploring these areas."
Australia's crude oil and condensate production has declined from nearly
100% of domestic needs in 2000 to just over 60% currently and an anticipated
32% by 2017, in the absence of new discoveries. According to APPEA's figures,
Australia produced 119.9 million barrels of crude in calendar 2007, down 3%
from 124.7 million barrels in 2006.