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"Bitterly disappointing decision": BP abandons plans to drill the Bight


UPDATED: Treasurer Tom Koutsantonis says BP’s decision to abandon its plans to drill for oil in the Great Australian Bight is “bitterly disappointing”, but environment groups are urging other oil companies to follow suit.

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BP’s Managing Director for Exploration and Production in Australia, Claire Fitzpatrick, said in a statement this morning that the company would withdraw from the project because it did not align with BP’s “strategic goals”.

Koutsantonis told reporters shortly after the announcement that “every Australian has a right to feel disappointed by BP”.

“They made a promise to the Australian Government that they would spend nearly $1.4 billion on exploration in the Great Australian Bight when they tendered for these tenements and now, they withdraw,” he said.

“BP, today … have done tremendous damage to their international reputation.”

He said the decision was particularly disappointing because, “the prevailing market has remained pretty much unchanged for the past year and a half [and] they could have made this decision a lot earlier”.

Koutsantonis said BP would have to invest in another piece of economic infrastructure in SA or elsewhere in Australia to remain in “good standing with the public” and to regain the trust of Australian Governments.

“What is the opportunity-loss for the country? These are questions the Prime Minister needs to ask of the chief executive of BP,” Koutsantonis said.

Fitzpatrick said: “We have looked long and hard at our exploration plans for the Great Australian Bight but, in the current external environment, we will only pursue frontier exploration opportunities if they are competitive and aligned to our strategic goals.”

“After extensive and careful consideration, this has proven not to be the case for our project to explore in the Bight.

“This decision isn’t a result of a change in our view of the prospectivity of the region, nor of the ongoing regulatory process run by the independent regulator NOPSEMA.

“It is an outcome of our strategy and the relative competitiveness of this project in our portfolio.”

Koutsantonis said he expected the company to make all of its research and exploration work in the Bight, which it has thus-far kept confidential – available to the public so that SA’s geoscience data could be improved, and in order to incentivise other companies to explore the marine area.

Fitzpatrick said the decision had been “incredibly difficult, and we acknowledge it will be felt across the South Australia region”

“We have made significant progress with preparations for drilling in the Bight with the support of communities and federal, state and local governments,” she said.

“We acknowledge our commitments and obligations and our priority now is to work with government and community stakeholders to identify alternative ways of honouring these.”

The company’s plans to explore the Bight have drawn strident criticism from the Wilderness Society and protests from direct-action ocean conservation organisation Sea Shepherd.

The Wilderness Society released scientific modelling last year showing that a potential oil spill in the bight would devastate South Australia’s $422 million fishing industry and coastal tourism across Australia’s southern coast.

Federal regulator NOPSEMA has twice knocked back the company’s environmental plan for the project, asking it to be amended.

Wilderness Society National Director Lyndon Schneiders said this afternoon that all oil companies should abandon any plans to drill there.

Schneiders said the Bight was a haven for marine species.

“The Great Australian Bight waters are deeper, more treacherous and more remote than the Gulf of Mexico, where BP was responsible for 800 million litres of oil spewing into the Gulf for 87 days in 2010,” said Schneiders. 

“The Great Australian Bight’s pristine waters are a haven for 36 species of whales and dolphins, including the world’s most important nursery for the endangered southern right whale as well as many humpback, sperm, blue and beak whales.

“It’s also Australia’s most important sea lion nursery and supports seals, orcas, giant cuttlefish and some of Australia’s most important fisheries.”

He said BP’s spill modelling had shown any spill from the project was “guaranteed to impact the South Australian coast and could hit Port Lincoln and Kangaroo Island in 15 days and Adelaide in 20 days”.

“It’s time to end the dangerous fiasco of oil and gas exploration in the Great Australian Bight.”

Schneiders said BP’s abandonment of its plans demonstrated it would be financial “folly” for any other oil company to pursue such plans.

“If BP with all its experience cannot produce an acceptable drilling plan for NOPSEMA, the remaining companies exploring in the Bight will be wasting their shareholders’ money trying to pursue this folly,” Schneiders said.

“This decision shows that it’s too expensive to establish the significant and costly risk management and clean up capacity infrastructure needed to protect our communities from the enormous spill risks associated with drilling in this part of the world.

“Clearly this is a far too high cost oil basin for any oil company to consider exploiting.”

However, Koutsantonis said other companies, including Chevron and Santos, had their own plans to drill in the Bight.

“The oil isn’t going anywhere – there will be other companies that will explore [the Bight],” he said.

“I think, ultimately, this basin will be developed. The question is by whom, and when.”


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