Key facts
- Australia is increasing oil and gas exploration activities due to the current energy crisis and reduced domestic refining capacity.
- Companies are projected to spend over $1 billion on gas exploration this year, marking a 10% increase from the previous year.
- New drilling licenses have been awarded, and reforms are being implemented to accelerate exploration efforts.
- Queensland has introduced legislation to streamline the development of energy projects.
- Key exploration areas include the Taroom Trough, Beetaloo Basin, and Bedout Basin.
- Santos is appraising the Beetaloo and Bedout basins, with the Dorado discovery potentially reaching a final investment decision in 2027.
Australia is experiencing a surge in oil and gas exploration activities, driven by a confluence of factors including the ongoing energy crisis, reduced domestic refining capacity, and strong demand from Asia. The nation, a major LNG exporter, faces challenges in ensuring domestic fuel supply, exacerbated by the closure of five out of seven refineries since 2013 and recent disruptions linked to the Iran war.
To address these energy security concerns, Australian federal and state governments are actively encouraging increased exploration. This year, operators are expected to invest over $1 billion in gas exploration, a 10% increase from last year, according to Rystad Energy. Despite a slight quarter-on-quarter dip in petroleum exploration expenditure in early 2026, the year-on-year trend shows a significant increase in both onshore and offshore drilling.
Public support for accelerating domestic energy development is high, with polls indicating strong backing for increased oil production and gas resource development. Governments are responding by awarding new drilling licenses and implementing reforms to streamline project approvals. New South Wales has launched its first natural gas exploration tender in a decade, and Queensland has introduced legislation to fast-track critical minerals and energy projects.
Several promising exploration areas are being targeted, including the Taroom Trough, Beetaloo Basin, and Bedout Basin. The Queensland government has awarded tenders in the Taroom Trough, where exploration commitments exceed US$344 million. Santos is set to appraise the Beetaloo Basin, estimated to hold over 430 tcf of undiscovered gas, and the Dorado discovery in the Bedout Basin, Australia's largest undeveloped oil project, could reach a final investment decision by 2027.