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Sydney: Australia's oil resources may last a decade at current production rates, making supply security a "major concern," said energy minister Martin Ferguson.
Australia will review all oil and gas leases granted to explorers for their "commerciality" Ferguson said yesterday at a conference in Darwin.
Oil and gas field permit holders must work the fields if they can be profitably developed, Ferguson said.
The nation's spending on exploration jumped 57 per cent last year to a record A$2.66 billion ($2.6 billion) even as the number of wells drilled fell because equipment and labour shortages drove up costs.
Explorers need to boost work in frontier areas to avoid a A$28 billion petroleum trade-deficit within a decade, the Australian Petroleum Production & Exploration Association said in April.
Sedimentary basins
"Australia is lightly explored for petroleum. Our frontier areas, the vast majority of Australia's more than 50 sedimentary basins, are unexplored," Ferguson said at the 2008 South East Asia Australia Offshore Conference.
The government will review oil and gas exploration permits by the end of the year, Ferguson said. Companies that hold leases and haven't developed them will be given 12 months to prove the areas aren't viable.
Eni, Italy's largest oil company, plans to start production from its Blacktip gas field in early 2009, Paul Henderson, chief minister of Australia's Northern Territory, said at the conference.
The project will cost almost A$1 billion ($975 million).
Australian energy production growth will be led by liquefied natural gas, with exports of the fuel set to jump by more than seven per cent a year through 2030, the government's commodities forecaster said in December.
LNG output may rise from less than 16 million metric tonnes in 2007-08, to 24 million tonnes by 2011-2012, before potentially more than tripling to 76 million by 2029-2030 on new projects, the Australian Bureau of Agricultural and Resource Economics said.
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