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Offshore oil and gas exploration and development
Under the Offshore Petroleum and Greenhouse Gas Storage Act 2006 oil and gas companies must meet a number of requirements before commencing offshore oil and gas activities in Australian Commonwealth waters, including:
- holding the appropriate permits, leases and licences (titles) recorded by the National Offshore Petroleum Titles Administrator (NOPTA)
- having comprehensive environment and safety plans accepted by the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA)
Annual acreage release
Each year the Australian Government releases new offshore areas for oil and gas exploration via the offshore petroleum exploration acreage release.
The acreage release provides an opportunity to competitively bid for an exploration permit over an area.
The government assesses the bids to determine which work program is most likely to achieve the fullest assessment and understanding of petroleum potential within a permit area, in the specified time frames.
Successful bidders are granted a work bid exploration permit: a 6-year title that can usually be renewed for a further two periods of 5 years. Acreage release areas that are 1 graticular block in size cannot be renewed for a further permit term.
Before a petroleum exploration permit holder can carry out activities in their approved work program, they must submit to NOPSEMA:
- an environment plan demonstrating how they’ll manage their activities’ environmental impacts and risks to as low as reasonably practicable, and an acceptable level.
Depending on the nature of the activity, companies may also need:
- a safety case demonstrating how they’ll manage risks to ensure their offshore activities are safe
- a well operations management plan (WOMP) demonstrating how they’ll maintain well structural integrity to protect the health and safety of offshore oil and gas workers, and prevent oil and gas releasing into the environment
If NOPSEMA accepts these submissions, permit holders can carry out their own seismic surveys or drilling tests in areas shown to be more likely to hold oil and gas deposits. They can also purchase seismic data from other companies.
Exploration doesn't always result in oil or gas discovery.
A key part of oil and gas exploration is seismic surveying, which involves sending controlled pulses of sound towards the seabed to generate detailed images of underlying geological formations.
Companies with an exploration permit and appropriate environmental approvals can carry out seismic activities in their own title areas. To survey in an adjoining area, they need to apply to NOPTA for a short term access authority.
Other companies looking to survey vacant areas can apply to NOPTA for a special prospecting authority. Read about short term oil and gas titles on the NOPTA website.
Companies who find oil or gas while exploring their permit area must determine whether it’s commercially viable to recover under current technological and economic conditions.
Companies can apply for a production licence over the area if the deposit is deemed viable. Before recovering the deposit they must submit and have accepted:
- a safety case to NOPSEMA
- an environment plan to NOPSEMA
- a WOMP to NOPSEMA
- a field development plan to the Joint Authority via NOPTA
- an approved rate of recovery to the Joint Authority via NOPTA
- an offshore project proposal to NOPSEMA
Companies can apply for a retention lease if the deposit isn’t currently commercially viable, but is likely to be within 15 years. Retention leases run for five years and may be renewed.
There are also other licences and approval processes for development activities including:
Decommissioning a site
Companies must decommission oil and gas wells, pipelines and other infrastructure no longer needed or in use.
Decommissioning activities like plugging and abandoning wells, removing property and rehabilitating sites must be done in a safe and environmentally responsible way.
Companies need an accepted environment plan, safety case and other documentation just like other oil and gas activities.
Read about the review of the oil and gas decommissioning framework.
Protecting the environment
Under the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2009, all oil and gas activities must have an environment plan assessed and accepted by NOPSEMA before an activity can take place. Oil and gas companies must demonstrate to NOPSEMA how they will manage their activities’ environmental impacts and risks to as low as reasonably practicable, and an acceptable level.
To be accepted by NOPSEMA the plan must:
- assess all risks and impacts from the activity (including impacts to matters protected under Part 3 of the Environment Protection and Biodiversity Conservation Act 1999
- include an oil pollution emergency plan describing arrangements for responding to, and monitoring, oil pollution
- demonstrate adequate financial assurance to meet any costs associated with a major environmental incident
Offshore project proposals
Oil and gas recovery activities require an offshore project proposal to be prepared and assessed by NOPSEMA.
Protecting the environment and heritage
The Department of Agriculture, Water and the Environment has a range of resources to support environmental management, including:
- marine bioregional plans
- conservation values atlas
- Australian heritage database and historic shipwreck information
- protected matters search tool
- requirements under the Sea Dumping Act 1981
Companies must consider if Native Title claims affect their exploration activity. Search the National Native Title Tribunal registers.
When preparing an environment plan, oil and gas companies may consult with a range of stakeholders, including government agencies, fishing, tourism and other business operators, community groups and non-government organisations (including conservation groups). Further information on consultation with Australian Government agencies can be found on the NOPSEMA website
Companies must document consultations and explain how they have addressed any relevant issues and concerns, and provide this to NOPSEMA before an environment plan is accepted.
Environment plans for seismic surveys or exploration drilling are subject to a public comment period prior to assessment by NOPSEMA.
Consultation for offshore project proposals are open for public comment for at least four weeks.
Considering other marine users
Oil and gas activities in Australian waters must comply with Australian law, and must not interfere with the rights and interests of other marine users.
Companies should consider the following matters before commencing activities.
Australian marine parks
Oil and gas activities are only permitted in certain marine park zones. Activities may be authorised in multiple-use zones and special purpose zones, subject to the marine park management plan.
For more information contact MarineParks@environment.gov.au
Defence practice areas and safety
Activities may be restricted when they coincide with defence offshore training areas and restricted airspace. See notice to airmen and notice to mariners for current restrictions. You could be ordered to evacuate defence training areas at short notice.
Unexploded ordnance may be present on or in the sea floor.
Commercial fisheries operate across all states’ and Northern Territory waters, and to the Australian exclusive economic zone limit. Companies must consider the impact of oil and gas activities on commercial fishing in Australian waters when preparing their environment plan and offshore project proposal.
For more information contact email@example.com.
Companies may need to assess their security risk and prepare a security plan.
Navigating Australian waters safely
Companies must put in place measures to mitigate collision risks with all shipping traffic.
For more information contact NauticalAdvice@amsa.gov.au
Companies must manage risk and avoid accidental damage to Australia’s submarine telecommunication cables.
For more information contact firstname.lastname@example.org
Offshore greenhouse gas storage
Greenhouse gas storage may coincide with oil and gas permit areas. View the National Offshore Petroleum Information Management System (NOPIMS) GIS map.
- Read about offshore oil and gas production laws and regulations on NOPTA’s website
- See Australia’s maritime zones, including state, territory and Australian waters on the Geoscience Australia website
- Read Australian Petroleum News for updates on offshore oil and gas activities
- See the outcomes of the Offshore South East Australia future gas supply study
- See guidance on consultation with agencies with responsibilities in Australian waters
- Read about the process of streamlining environmental approvals
- See information on combination certificates for petroleum projects
Last updated: 19 January 2021
Content ID: 46908