Australia Regulator Rejects BP's Deep-Sea Drilling Plans
18 November 2015 - 12:33AM
Dow Jones News
MELBOURNE, Australia—BP PLC's proposal to explore for oil off
southern Australia has been rejected by the country's offshore
petroleum agency, which said the energy company's environmental
plan didn't meet regulatory requirements.
In a statement on its website, the National Offshore Petroleum
Safety and Environmental Management Authority said it wasn't
satisfied with the environmental plan submitted by the U.K. company
in early October. The plan doesn't yet meet criteria for acceptance
under environment regulations, the agency said.
It comes after the agency late last month delayed an initial
decision on BP's proposal to drill four exploration wells in an
area known as the Great Australian Bight from next year, in water
depths ranging between 1,000 and 2,500 meters (3,280-8,200
feet).
A spokeswoman for BP said Tuesday it was now up to the company
to submit a revised version of its environmental plan.
"NOPSEMA is a diligent and thorough regulator and we expect to
have to work hard and take the time to demonstrate that we have got
our EP right," she said.
The Bight is potentially a vast new oil basin for Australia. BP
has said the area has similarities in the geology to some of the
world's biggest hydrocarbon regions, such as the Niger Delta and
the Mississippi Delta.
However, environment groups have warned of the risks of a
deep-sea well blowout in the Bight. The Wilderness Society said a
spill would threaten South Australia state's 442 million Australian
dollar (US$313 million) fishing industry and A$1 billion in coastal
tourism, and would harm waters that are a haven for several species
of whales, as well as sea lions and other animals.
Nick Xenophon, an independent senator for South Australia, said
NOPSEMA's decision not to approve BP's environmental plan showed
there were unacceptable risks in the proposal. He has said he
planned to introduce a bill next year that would give the final say
on whether deep-sea drilling goes ahead to the federal environment
minister rather than to the regulator. Industry body the Australian
Petroleum Production & Exploration Association rejected the
move, saying the agency should be allowed to work without political
interference.
In 2011, BP secured four permits from the federal and state
governments to explore for oil and gas in the Bight, which the
company said committed it to a A$605 million exploration program
including a seismic survey and drilling the wells. Statoil has a
30% stake in the planned operation.
At its closest point, the planned drilling would take place
about 395 kilometers west of Port Lincoln and 340 kilometers
southwest of Ceduna off South Australia.
Write to Robb M. Stewart at robb.stewart@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 17, 2015 03:45 ET (08:45 GMT)
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