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Australia may well be the world's largest natural gas exporter but fulfilling those orders has pressured domestic prices. The Exxon Mobil and BHP Billiton development of the West Barracouta gas field in the Gippsland Basin will bring fresh gas to Australian domestic markets.

Australia Gippsland Basin Map

Exxon said the project, located offshore of Victoria, is part of its continuing investment in the Gippsland Basin, The Gippsland basin is rich in both oil and gas. BHP said they will invest about AUD 200 million in the gas field in a separate statement.

Rising natural gas prices has become a political hot potatoe in Australia with households and manufacturers complaining of higher costs. The Gippsland Basin joint venture continues to supply about 40 percent of east coast Australian domestic gas demand, Exxon said, adding that front-end engineering design work for the project was completed and key contracts awarded.

Mr Graham Salmond, General Manager of BHP Petroleum Australia, said that "The West Barracouta project is an important investment, underpinned by strong economics and rates of return, that will unlock a high quality, new gas resource and will help offset Bass Strait production decline at a vital time for the east coast market. BHP is actively engaging with a diverse range of customers for future Bass Strait gas supply."

The West Barracouta development is expected to achieve first gas from 2021

Source: Reuters, Exxon

From a Sunburnt Country

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