Media Release
Solution to East Coast Australian Gas Supply Problems: Victorian Onshore Conventional Gas
Highlights:
- East Coast Australia experiencing gas shortages and high prices
- Lakes Oil has Independently Certified Contingent Gas Resources
- Onshore Victorian Conventional Gas would be low-cost
Lakes Oil NL (ASX: LKO) notes renewed reports highlighting soaring gas futures prices for 2019 reflecting forecast declining supply and consequent gas price increases on the Australian East Coast.
The high prices are both a threat to industry viability and are causing massive increases in the cost of electricity for householders, particularly in Victoria where wholesale price increases of 20% have been reported this financial year. This situation is likely to worsen as the availability of gas from the Australian Bass Strait continues to decline.
It is of concern that the dire circumstances facing east coast industry and Victorian householders are self-inflicted by Government action, particularly the Victorian Government’s ban on all onshore petroleum and gas exploration and development until July 2020.
Lakes Oil has independently certified1 Contingent Recoverable Gas Resources at its Wombat gas field of 329 PJ and, at the adjacent Trifon-Gangell gas field, of 390 PJ.
In addition, Lakes Oil has significant gas production potential at its Otway and Portland Energy Projects. It is independently estimated2 that the Focus Area for the Portland Energy Project contains 11.5 trillion cubic feet of recoverable gas, a significant portion of which will be recoverable by conventional means.
Mr Chris Tonkin, Chairman of Lakes Oil, said “Based upon conventional gas production techniques the Wombat and Trifon-Gangell gas fields could by themselves supply 20 PJ of gas per annum, or ten per cent of Victoria’s gas demand, while conventional gas from the Portland Energy Project could meet all of the state’s needs for 15 years or more. Since all of this gas is onshore, high-quality and conventional it can be produced and sold at prices much lower than those presently being suffered.
The Victorian Government should be called upon to immediately remove its unprecedented State wide ban on exploration and development of the State’s conventional gas resources, and allow that gas to be produced for the benefit of all Victorians”.
Lakes Oil is the oldest oil company in Australia and was formed in 1946 in Lakes Entrance, Victoria. Lakes has been exploring across Victoria for “tight” gas and shale oil and gas. Has spent over $80m on exploration activities within Victoria.
The company provides one of the few remaining links between the struggles to find and produce Australia's first indigenous oil reserves during the early part of this century and the relative comfort of the nation's near self-sufficiency in petroleum production during the 1990s.
Lakes has also kept alive the pioneering spirit of a once larger band of optimistic junior explorers willing to tackle programs in which more cautious major companies have declined to take part.
Taking its name from the Lakes district of Gippsland in south eastern Victoria, Lakes Oil plunged straight into a project to produce oil from shallow glauconite sands at the town of Lakes Entrance via a series of wells drilled from the base of a specially dug mine shaft.
