Natural Gas

Bass to explore east coast gas acreage as prices soar 250%

Tue 14 Jun 22, 1:30pm (AEST)
A residential gas burner stovetop firing in a dimly lit kitchen
Source: Unsplash

Stocks in article

bas
MktCap:
-
bpt
MktCap:
-
coe
MktCap:
-

Commodities in article

Share article

Key Points

  • Bass launches feasibility study ahead of acquiring Beach’s ‘Kiwi’ discovery
  • Despite the name, the Kiwi Gas Discovery is onshore Australia in the east coast Cooper Basin
  • Bass is picking up the pace on Cooper development as Australian gas prices surge

Next month, Bass Oil (ASX:BAS) will acquire from Beach Energy (ASX:BPT) the latter’s Kiwi Gas Discovery, located onshore Australia in the Cooper Basin. 

The Cooper Basin spans across northeast South Australia and into neighbouring states. 

Ahead of the acquisition of the gas exploration asset, Bass Oil has today commenced a feasibility study into commercialising the acreage. 

(Source: Bass Oil) A look at the company's acreage in the Cooper Basin
(Source: Bass Oil) A look at the company's acreage in the Cooper Basin

Move comes as gas prices up 250% 

The timing for Bass Oil is worth noting, given that Australian east coast gas prices have more than doubled in recent months.

Within the last thirty days, wholesale east coast gas prices approached $800 per gigajoule (before pricing mechanisms.) 

This week, east coast operators have been hit with a price cap mechanism by the ALP government which proponents allege leaves operations unprofitable. 

Further still, the Australian market regulator, AEMO, has ordered plants to boost production in the same day it warned households of possible blackouts. 

Bass Oil notes “the increasing price [of gas] significantly enhances the likelihood of Kiwi Gas Discovery commercialisation…[Bass] has accelerated its gas development and exploration.”

The catch is that Bass Oil will likely take a good deal of time to develop the Kiwi Gas acreage to sales. 

Current prices at the Walumbilla hub, the export/import terminal which acts as a benchmark for Australian gas prices, currently sit at $35.00/GJ. 

Bass eyeing large resource potential 

Bass Oil notes Beach’s so-called Kiwi discovery could boast up to 24 billion cubic feet of gas trapped underground, but that remains to be seen. 

Pursuant to the acquisition of Beach’s Kiwi discovery are other permits held by Cooper Energy Limited (ASX:COE). 

The feasibility study now underway will examine the logistics and commercial acumen of connecting Beach’s existing Kiwi-1 well to Bass Oil’s existing Moomba infrastructure. 

The study will also examine the feasibility of drilling CSG wells in South Australian licence PEL 182. 

(Source: AEMO) The Walumbilla Hub natgas price over the last three months
(Source: AEMO) The Walumbilla Hub natgas price over the last three months

 

Written By

Jonathon Davidson

Finance Writer

Jonathon is a journalism graduate and avid market watcher with exposure to governance, NGO and mining environments. He was most recently hired as an oil and gas specialist for a trade publication. Email Jon at [email protected].

Get the latest news and media direct to your inbox

Sign up FREE