Australian Oil, Gas Exploration Spending Jumped 70%

(Bloomberg) — Australian spending on offshore oil and gas exploration jumped 70 percent last year to a record because of spiraling costs and equipment shortages, the national petroleum industry lobby group said.

Investment in the hunt for oil and gas in waters around Australia surged to A$2.14 billion ($2 billion), the Australian Petroleum Production and Exploration Association said today in an e-mail. Spending including onshore drilling rose by about A$1 billion to A$2.66 billion even as the number of wells fell.

Offshore drillers such as Transocean Inc. and Atwood Oceanics Inc. are commanding higher rates as explorers ramp up work in the deepest waters of the Gulf of Mexico and elsewhere, outpacing rig availability. Royal Dutch Shell Plc, Chevron Corp. and Woodside Petroleum Ltd. are among companies seeking natural gas finds off Australia’s northwest to underpin export projects.

The increase in expenditure “is a stark illustration of the impact of rising costs and equipment shortages,” Belinda Robinson, chief executive officer of the industry group, said in an e-mailed statement.

Bloomberg