Rowley Shoals decision shows area tough

AAP 

February 04, 2013 3:22pm

THE decision not to re-release an oil and gas exploration permit near the Rowley Shoals Marine Park shows the offshore Kimberley region is proving difficult for the sector, an analyst says.

Federal Resources Minister Martin Ferguson will not re-offer the exploration permit W11-5, some 200km from the Kimberley coast and close to the Rowley Shoals, because no companies have applied for it since it was put up for grabs in April last year, his spokeswoman has confirmed.

There were also community concerns, she said.

Conservationists were up in arms in early 2012 when three permits including W11-5 were offered for exploration, although the hunt for oil and gas has been going on in the area for many years.

Shell's East Mermaid 1 well - smack in the middle of those three permits - was drilled in 1973 but abandoned due to technical problems and poor geological conditions.

The Rowley Shoals are a popular scuba diving site and are considered among the world's healthiest atolls.Woodside, no stranger to protests by conservationists with its contentious Browse gas hub plan at James Price Point north of Broome, is currently conducting seismic studies on permits north of Rowley Shoals, but says that activity is just to meet its obligations to retain the leases.

"This whole area is very difficult - you have to jump through a lot of hoops to get it going," State One Stockbroking analyst Peter Kopetz said.

While WWF Australia was pleased the W11-5 well was temporarily off limits to the oil and gas sector, it urged the federal government to create a permanent exclusion zone to the industry in the area.

On Browse, Mr Kopetz said it would be the economics of the project, not the vocal opponents, that would be the deciding factor in whether it proceeded.

Shell, with its preference for floating gas production, did not appear to be pushing the operator Woodside hard and was sitting back to see what happened, Mr Kopetz said.

While WA Premier Colin Barnett remains insistent the Browse hub must be built onshore where royalties will flow through to the state - rather than offshore, where the royalties will go to the Commonwealth - the project proponents would only choose a site that met their profitability criteria, he said.

"Why would someone lose money to appease someone?" Mr Kopetz asked.

Rowley Shoals oil and gas exploration controversy

ELEANOR HALL: The Federal Government's decision to call for expressions of interest in oil and gas projects close to a protected marine area is sparking another environmental battle in the country's north.

Rowley Shoals is a pristine reef about 260 kilometres north-west of Broome and is protected by three marine parks.

Environment reporter Conor Duffy:

CONOR DUFFY: You can't get much more remote than Rowley Shoals off the north-west coast of Western Australia.

And rare underwater footage provided to the ABC shows the isolation has meant protection.

ABC  Conor Duffy reported this story on Wednesday, April 11, 2012 07:27:00

Paul Gamblin from the World Wildlife Fund hopes it'll show the world what a special place the Rowley Shoals is.

PAUL GAMBLIN: It's kind of an Attenborough moment when you look at this footage and really appreciate how special this place is. It's a place that is unknown to many Australians. It's a place where wildlife including whales and dolphins, turtles, sharks, tuna, fish in their abundance, hundreds of species of coral are found. It really is a very special place.

CONOR DUFFY: The Federal Government has called for expressions of interest in oil and gas projects just three nautical miles from the reef.

On the department's website the pink lease area is broken up by three small circles that denote the marine parks of the reef.

Companies have to submit their bids by tomorrow. Development could include seismic activity and drilling. Paul Gamblin says that heavy work couldn't coexist with a fragile reef.

PAUL GAMBLIN: Look we believe that it's a really important moment in Australia's marine conservation history and this is a moment for Australia, for the Australian Government, to get the balance right. It's opened up huge areas to the oil and gas sector.

CONOR DUFFY: The Minister for Resources Martin Ferguson was unavailable for interview.

In a statement he says the ecological value of the reef and the fact part of the potential lease area is being considered for a marine reserve was noted in the acreage release.

EXTRACT FROM MARTIN FERGUSON'S STATEMENT: Any successful bidder will have to have an environmental plan assessed by regulators prior to undertaking any seismic or drilling activity. The legislation requires a comprehensive assessment of all significant impacts on matters of national and environmental significance.

CONOR DUFFY: But Paul Gamblin says history shows that after the initial expression of interest projects often proceed quickly.

PAUL GAMBLIN: If the Government proceeds with the release of this acreage and if the oil and gas sector believes it can reconcile its commitments to look after the environment with drilling so close to an environment like this, it could be within months that we'll see oil rigs right off the Rowley Shoals.

ELEANOR HALL: Paul Gamblin from the World Wildlife Fund with Conor Duffy.