The natural gas field development will bolster gas supplies to Australia’s east coast. Credit: Carsten ten Brink.

ExxonMobil and its joint venture (JV) partner BHP have decided to proceed with the development of the West Barracouta gas field in Bass Strait, offshore Victoria, Australia.

The partners made a final investment decision (FID) on the project in the VIC/L1 block offshore Victoria, as they intend to boost domestic gas supplies.

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Victoria is expected to face a gas shortage in 2022, according to a report by Australian Energy Market Operator.

ExxonMobil stated that the project is part of its continuing investment in the Gippsland Basin, adding that the front-end engineering design work for the project was recently completed and contracts were awarded to Subsea 7 and OneSubsea.

“Our objective is to produce West Barracouta gas for the Australian domestic gas market by 2021.”

The West Barracouta project involves the development of a sweet gas reservoir in Bass Strait through a two well brownfield tieback into the existing Gippsland Basin JV infrastructure.

ExxonMobil Production Company president Neil Duffin said: “We continue to use advanced technology, along with our extensive, decades-long understanding of the Gippsland Basin, to ensure the full potential of the resource can be realised. Our objective is to produce West Barracouta gas for the Australian domestic gas market by 2021.”

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The company noted that the Gippsland Basin JV continues to meet around 40% of the domestic gas demand of Australia’s east coast.

ExxonMobil subsidiary Esso Australia is the operator of the Gippsland Basin JV, in which it owns a 50% interest. BHP Billiton Petroleum (Bass Strait) holds the remaining 50% interest in the JV.

Other projects carried out by the JV in Victoria include the Kipper Tuna Turrum offshore project and the Longford gas conditioning plant.

BHP will invest A$200m ($144.33m) in the West Barracouta gas field development project, which is expected to commence gas production in 2021.

BHP Petroleum Australia general manager Graham Salmond said: “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 help offset Bass Strait production decline at a vital time for the east coast market.”

“We are also assessing other potential development opportunities in the Bass Strait to bring new supply to the domestic market.”