Australian upstream exploration spending falls

OREANDA-NEWS. Petroleum exploration spending in Australia fell by 3.2pc to A\$1bn (\$777mn) in October-December from the previous quarter, as higher onshore exploration spending in Queensland partially offset a continued decline offshore Western Australia.

But spending in US dollar terms fell by more than 7pc over the period because of the depreciation of the Australian dollar. The figures are unlikely to reflect the decline in oil prices, with much exploration activity determined months in advance.

Offshore spending continued to fall, dropping by 6.8pc from the previous quarter to A\$680mn in October-December following a 34.5pc decline on this basis in July-September, the Australian Bureau of Statistics said.

Onshore spending rose by 6.7pc in October-December to A\$330mn, partly recovering from a 33pc decline in the previous quarter.

The rise in onshore exploration reflects spending on coal-bed methane (CBM) fields to supply three LNG projects at Gladstone in Queensland. A lack of extreme weather in the October-December period allowed onshore CBM exploration to continue, with this reflected in a 55.1pc increase in exploration spending in Queensland on a seasonally-adjusted basis.

Exploration spending in Western Australia, which hosts mostly offshore gas and oil projects, fell by 8.1pc in October-December.

Spending on production leases fell by 6.9pc to A\$226mn in the latest quarter. Spending in all other areas rose by 7.7pc to A\$808mn, after falling by 40.2pc in July-September.