New figures reveal the Sunshine State’s exploration has sunk to a 15-year low.
The Australian Bureau of Statistics has confirmed that onshore petroleum exploration in the nation fell 27.8% in the December 2015 quarter, led by Queensland which itself was down 35.1%.
Lamont said it was “evident” that exploration activity in the state was actuallt falling well before the relatively recent decline in the global oil price.
“Analysis of exploration activity confirms that falling commodity prices are just one of the factors responsible for declining exploration,” Lamont said.
He cited “regulatory creep”, a lack of highly prospective new acreage, data gaps, diminished access to capital and constraints on access.
“We have a clear need for more exploration activity but a plethora of regulatory restrictions and uncertainty are frustrating the industry in ensuring there is the necessary activity in exploration to meet future energy needs,” he said.
An example of “regulatory creep” was the creation of a water trigger – an amendment to the Federal EPBC Act which duplicates existing state legislation and adds at least six months to project approval timelines, according to APPEA.
The federal government said that including the water trigger in approval bilateral agreements was important for establishing the “One-Stop Shop” for environmental approvals.
The aim is to ensure the water trigger is treated in the same way as all other matters of national environmental significance.
Ironically, the Commonwealth believes that providing a single approval process for projects involving the water trigger will reduce the regulatory burden on business while ensuring that high environmental standards are maintained.
This, it hoped, would provide more certainty for investors with a simpler, streamlined regulatory system.
However, in relation to regulatory creep, the overarching issue is the time it takes to move from exploration to production, Lamont told Energy News.
This has increased substantially in recent years and industry laments the estimated 15-year timeframe from permit award to reach production.
Regulatory costs have also risen significantly.
Energy News reported Deloitte’s Brisbane-based national director for oil and gas Geoffrey Cann telling an LNG18 ‘thought leadership’ luncheon in Perth that Queensland was in no position to help alleviate New South Wales and Victoria from their energy crisis because it takes some 14 years from applying for a license to producing first gas in Queensland, and $100 million would be spent in the process.
The upstream industry wants a government commitment to reduce time and cost of the approval process by at least 50%.
The Queensland government’s Gas Supply and Demand Action Plan is expected to quantify these issues in detail and set out a road map for action.
“The industry requires access to geoscience and related information held by government to make investment decisions. This information is not either readily accessible or in a user friendly format,” Lamont said, referring to historical data which is yet to be digitised.
Additionally, he warned that the annual acreage release program in Queensland is slow by international standards.