Gas drill delay as Canberra steps in

A RESOURCES company is reviewing a plan to continue drilling for gas off the Surf Coast as it weights up the impacts of federal government market intervention.

Cooper Energy had been due to make a final investment decision on its Otway Phase 3 Development early this year, but stated in its latest quarterly update that the project was in limbo as the government brought in new regulations for the sector.

In December last year, federal cabinet implemented changes to the wholesale gas market including a temporary price cap on sale contracts, and forcing producers into a code of conduct that had previously been voluntary.

“Sanction of the [OP3D] project is now subject to satisfactory resolution of the Federal Government’s proposed mandatory Code of Conduct and reasonable pricing mechanism, and joint venture support,” Cooper’s March quarterly report stated.

But the report also indicated Cooper’s confidence in the project eventually occurring. The company continued engineering and design work in anticipation of more favorable conditions to come.

Cooper owns exploration licenses for areas south-west of Port Campbell, and uses pipelines that connect to the Anthena Gas Plant on shore.