BPH Energy and Advent make preparations for Seablue-1 drilling at PEP 11

BPH Energy (ASX: BPH) and investee company Advent Energy are leaving no stone unturned as they push ahead with plans to test a large gas target in the PEP 11 permit off the NSW coast.

Despite the NSW government’s proposed ban aimed at blocking oil and gas activities off its coastline and with an application for an extension of the PEP 11 licence yet to be submitted to the Federal government, the two companies are continuing with their commitment to drill the Seablue-1 exploration well.

To help fast-track potential environmental approvals for that well, Advent – through its wholly-owned subsidiary Asset Energy – has engaged Perth-based environmental consultancy Klarite to create fresh paperwork for Seablue-1.

Approval process

The offshore environmental management specialist recently developed a detailed environmental approvals strategy for Seablue-1.

The aim from here is for Klarite to develop an environmental management process which will define Asset’s consultation and negotiation basis with relevant persons and assess environmental impacts.

Boosted by the Federal government’s apparent pro-development stance, Advent and BPH believe that PEP 11’s estimated prospective resources of 5.7 trillion cubic feet make it an important asset for the energy-hungry east coast market.

They also believe that PEP 11 sits in Commonwealth waters and outside the areas to be governed by NSW’s anti-oil and gas bill.

“Due to the critical need for new domestic supplies of gas as stated in the federal government’s Future Gas Strategy (FGS), Asset has decided to commence work necessary for environmental approvals in advance of the PEP 11 licence application approval, in order to be prepared to drill the Seablue-1 well as soon as possible thereafter,” BPH said in an ASX announcement.

Key transition role

BPH states that the FGS and supporting documents submitted by Minister for Resources Madeleine King confirm the key role gas will play in the transition to net zero by 2050 and beyond.

“The FGS states that exploration and development should focus on optimising discoveries and infrastructure in producing basins where gas will be proximal to where it is needed and will be lower cost than relying on liquefied natural gas (LNG) imports,” BPH said.

The company noted that many of the arguments made in the FGS document support the case for drilling at Seablue-1.

This includes mechanisms to divert uncontracted gas to the domestic market through the Australian east coast domestic gas supply heads of agreement and contracted export gas to the domestic market.

BPH also noted that any gas supplied through the LNG import terminals proposed for the east coast could be more expensive than gas developed closer to demand centres.