Australian oil and gas company Beach Energy has ceased development planning for its Bass Basin discoveries, which include Trefoil, Bass, White Ibis and Yolla West, offshore Australia, amid strategic review.
On conclusion of Beach's strategic review, it has been determined that development of the Bass Basin discoveries - Trefoil, Bass, White Ibis and Yolla West - will not utilize any optional slots as part of the upcoming Offshore Gas Victoria drilling program as they do not meet minimum investment requirements.
As a result, development planning on these opportunities has ceased. Alternate usage for Beach’s Bass Basin infrastructure will be investigated in parallel with restoration planning, the company said.
The Bass Basin is located offshore between the southern tip of Victoria and the northern margin of Tasmania in the shallow waters of Bass Strait.
In the Bass Basin, Beach extracts natural gas from the Yolla field, transporting it to shore via a 147 kilometre subsea pipeline. There, it joins the 32km-long raw gas pipeline to the BassGas processing plant near Lang Lang in Victoria.
Once processed, the gas from the Lang Lang Gas Plant is sold to retailers who use it for domestic or commercial consumption in the East Coast natural gas market.
As a result of the decision not to invest in a Bass Basin development at this time, Beach expects to recognize a non-cash impairment charge to the carrying value of Beach’s Bass Basin assets of approximately $165-181 (A$250-275) million before tax.
In addition, Beach Energy has revised the recovery reserves estimates for the Kupe South 9 development in Taranaki Basin, offshore New Zealand.
The Kupe South 9 development well was drilled in the second quarter of the fiscal year 2024 to target gas in an eastern area of the Kupe field.
The well delivered at low gas flow rates after connection to the Kupe Gas Plant, and well intervention activities did not improve the gas flow rate, Beach Energy informed.
The results confirmed that production from the existing wells has drained gas from this eastern area, leading to a reduction in expected recovery, according to the company.
The reserves revision is expected to result in a non-cash impairment charge to the carrying value of Beach’s Taranaki Basin assets of approximately $75-82 million (A$115-125 million) before tax.