Royal Dutch Shell Plc  .com Rotating Header Image

Royal Dutch Shell Plc among companies seeking natural gas finds off Australia’s northwest

BLOOMBERG: Australian Oil, Gas Exploration Spending Jumped 70% (Update2)

By Angela Macdonald-Smith

April 3 (Bloomberg) — Australian spending on offshore oil and gas exploration jumped 70 percent last year to a record because of spiraling costs and equipment shortages, the national petroleum industry lobby group said.

Investment in the hunt for oil and gas in waters around Australia surged to A$2.14 billion ($2 billion), the Australian Petroleum Production and Exploration Association said today in an e-mail. Spending including onshore drilling rose by about A$1 billion to A$2.66 billion even as the number of wells fell.

Offshore drillers such as Transocean Inc. and Atwood Oceanics Inc. are commanding higher rates as explorers ramp up work in the deepest waters of the Gulf of Mexico and elsewhere, outpacing rig availability. Royal Dutch Shell Plc, Chevron Corp. and Woodside Petroleum Ltd. are among companies seeking natural gas finds off Australia’s northwest to underpin export projects.

The increase in expenditure “is a stark illustration of the impact of rising costs and equipment shortages,” Belinda Robinson, chief executive officer of the industry group, said in an e-mailed statement.

Houston-based Transocean, the world’s largest offshore oil and gas driller, in October signed a then-record $600,000 a-day drilling contract with a customer it didn’t name. The rig was being hired out at the time at $395,000 a day. Diamond Offshore Drilling Inc., Frontier Drilling ASA and Songa Offshore ASA are among other drillers working off Australia’s coast.

Bigger Budgets

BHP Billiton Ltd., Australia’s biggest oil and gas producer, in February increased its petroleum exploration budget for the year ending June 30 by 20 percent after boosting drilling in the Gulf of Mexico and Western Australia. Global capital investment in offshore oil and gas exploration and production is set to reach $250 billion by 2010 up from about $150 billion in 2004, Australian engineering company WorleyParsons Ltd. said this week, citing Douglas-Westwood Ltd., a U.K. consulting firm.

Spending on onshore exploration in Australia rose 21 percent to A$519.1 million, while the number of wells drilled fell 15 percent to 74, according to Australian Bureau of Statistics data cited by the association. The number of offshore wells drilled rose by five to 37. The amount of seismic work carried out also fell, the data shows.

Australia’s crude-oil production dropped about 3 percent to 120 million barrels last year, contributing to a 1 percent slide in combined crude, condensate and liquefied petroleum gas output to 196.7 million barrels, the association said.

“The slight decline in liquids production can largely be attributed to a combination of shutdowns on significant producing assets and natural field decline,” Robinson said.

Liquefied natural gas production gained 8 percent to 15.1 million metric tons, while gas output for sale within Australia gained 10 percent to 887.7 billion cubic feet, the association said.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at [email protected]

Last Updated: April 2, 2008 22:17 EDT

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aJFs3X25jjrQ

www.royaldutchshellplc.com

royaldutchshellplc.com and its also non-profit sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “Royal Dutch Shell Plc among companies seeking natural gas finds off Australia’s northwest”

Leave a Comment

%d bloggers like this: