Beach Energy Ltd., Adelaide, has flagged its intention to withdraw from the Basker-Manta-Gummy (BMG) joint venture in Bass Strait effective Oct. 27, the end of the current permit year. The firm holds 35% nonoperated interest in the JV.
The company said its decision is consistent with its ongoing focus on portfolio optimization and prioritizing capital allocation in the prevailing low oil price environment. Consequently Beach does not want to participate in the proposed appraisal of Manta gas field.
The move follows the offer from the government regulatory body and acceptance by the JV to convert the Basker, Manta, and Gummy gas field permits Vic/L 26, 27, and 28 into retention leases.
Beach’s interest will be assigned to JV operator and fellow Adelaide firm Cooper Energy Ltd. without cost.
Cooper bought 65% of the field at the end of March 2014 by purchasing all of then-operator Roc Oil Co. Ltd.’s 50% and 15% from Beach.
The BMG fields hit the headlines in 2006 when the oil component of Basker and Manta fields was brought on stream via a small floating production vessel and a dedicated storage and delivery tanker. At peak, oil production was 6,000 b/d. Produced gas was reinjected into the Basker reservoir.
The two fields, along with nearby Gummy gas field, contain undeveloped liquids-rich gas and some remaining oil reserves. Oil production was suspended in 2010 because a full field development, including gas development, was considered non-commercial.
However Cooper Energy believes the BMG fields have gas production potential because of their close proximity to existing infrastructure and the developing eastern Australian gas market
Cooper wants to evaluate development options for the fields’ next stage of development as a gas project.
Basker, Manta, and Gummy fields were originally found by Royal Dutch Shell PLC in 1983, 1984, and 1990, respectively, but considered non-commercial at that time.
Basker, in 200 m of water and 70 km offshore Victorian, is the main oil field. Manta lies in 110 m of water a similar distance from shore and contains oil as well as significant gas reserves. The smaller Gummy field is in 150 m of water about 75 km offshore and contains mostly gas.
Shell and its partners sold the fields to Woodside Energy Ltd., Perth, in the mid-1990s and that company subsequently sold them to Anzon Australia in March 2004. Beach farmed in during 2005.
Roc Oil merged with an ailing Anzon in 2008 and took control of the BMG operations. Other interest holders that have come and gone during the second half of the 2000s were Cieco Exploration & Production (UK) Ltd., Sojitz Energy Australia Pty Ltd., and PT Pertamina.