The historic Gippsland Basin joint venture completed its first discovery well 50 years ago, in February 1965. That well and the offshore facilities that followed have supported production of some 4 billion barrels of oil and 8 trillion cubic feet of gas.
In the half century since the first discovery, investments of around $20 billion have funded 17 platforms, associated subsea production systems and other offshore installations feeding a network of about 370 miles of pipelines.
Esso Australia operates the venture, in which Esso and BHP Billiton Petroleum (Bass Strait) Pty. Ltd. each have a 50 percent interest.
Onshore, investments include the Longford complex, comprising three gas plants and a crude-oil stabilization plant in the state of Victoria that serves as the onshore receiving point for the venture’s Bass Strait production. Longford has supplied most of Victoria’s gas requirements since 1969. It also supplies gas to New South Wales, Tasmania and other locations.
About 115 miles west of Longford, the Long Island Point complex includes a fractionation plant for separating gas liquids processed at Longford into separate ethane, propane and butane product streams. Long Island Point also stores crude oil before distribution to refineries in Australia and overseas. A jetty extending about 2,000 feet offshore is equipped to load gas liquids and oil onto ships.
The joint venture’s marine-support base is the Barry Beach Marine Terminal about 60 miles southwest of Longford. Its 1,300-foot wharf accommodates a pedestal crane with a 110-ton lifting capacity. Cargo shipments from Barry Beach to the offshore platforms average about 70,000 tons per year.
Richard Owen, Esso Australia chairman, describes the Gippsland Basin joint venture as one of the most enduring partnerships in Australia’s corporate history.
“The story of oil and gas in Australia will always hinge on Bass Strait,” he says. “Our investments have been a critical building block underpinning the economic growth of this nation. “At the peak of oil production in the early 1980s, the venture was delivering 10 percent of total federal revenue. Today, it meets nearly 40 percent of Australia’s East Coast gas demand.”
Recent activity in the basin includes the Kipper Tuna Turrum (KTT) project, encompassing three fields in Bass Strait that hold an estimated 1.6 trillion cubic feet of gas, plus 110 million barrels of oil and gas liquids.
The KTT project reflects the company’s focus on extracting maximum value from the investment and Gippsland Basin field infrastructure. For example, oil facilities on the West Tuna platform, installed in 1996, have been converted to produce additional gas from the Tuna field which has produced oil for more than 40 years.
In the Turrum field (the project’s largest), the nearby 47-year-old Marlin A platform has been connected to the new Marlin B platform by bridge. The combination of platform facilities, including compression capacity on Marlin B, enables greater production efficiencies along with increased volumes of oil and gas. Turrum gas, which contains higher levels of carbon dioxide (CO2) than other Bass Strait fields, will continue to be reinjected back into the reservoir until a gas-conditioning plant comes online at Longford in 2016. Four more gas wells and an oil well were drilled this year.
The Kipper field discovered in 1986, is a joint venture between Esso Australia (operator, 32.5 percent), BHP Billiton (32.5 percent) and Santos Ltd. (35 percent). Gas and gas liquids will be produced through subsea wells tied to the West Tuna platform. Installed close to West Tuna, a smaller, unstaffed satellite platform called the Riser Access Tower links to West Tuna via bridge and connects the Kipper pipelines to West Tuna.
Owen notes that rising gas prices in southeastern Australia and supportive government energy and regulatory policies helped make the KTT project economically feasible.
“Credit must also go, however, to the decades-long efforts of Esso and joint-venture scientists and engineers to expand their geoscientifi understanding of the Gippsland Basin as well as their ongoing development and application of new technology,” he says.
A case in point is the Turrum field.
“Turrum was literally in the shadow of the Marlin field since its discovery in 1966,” says David Standfield Gippsland projects manager. “The largest gas field in southeastern Australia, Marlin sits atop Turrum, which is more than a mile below the seafloor. Marlin is also typical of the more attractive early Gippsland Basin fields, with its large reserves of cleaner gas, high-pressure reservoirs and geology dominated by thick marine sands.
“Turrum, however, was always going to require significant capital investment. In addition to its higher levels of CO2, Turrum’s geology is much more complex. And unlike the shallower fields, its low reservoir pressure would require offshore compression to produce, which meant the installation of another platform.”
Things began to look up for Turrum after the Bass Strait’s largest 3-D seismic survey in 2001.
“The survey allowed us to get a better picture of the reservoirs,” Standfield says. “We later combined this information with data from an early-phase drilling program in which we drilled three oil wells and produced them back to the Marlin A platform. This oil production provided valuable data on the reservoir’s performance and characteristics, and helped us develop some of the most sophisticated reservoir modeling ever attempted in the Gippsland Basin. Based on what we learned about the field and with the value of gas increasing in Australia’s East Coast market, the venture moved forward with a gas-development plan for Turrum.”
While Esso Australia, on behalf of its venture partners, has reliably supplied energy to the country for almost half a century, Owen notes that their success has been underscored by an excellent safety record.
“We are an industry safety leader in Australia,” he says. “In fact, Esso Australia won the Australian Petroleum Production and Exploration Association Safety Excellence Award in 2013 and 2014 for best oil and gas industry safety performance. For our Bass Strait operations in particular, we went more than 12 months during those two years without a recordable injury onshore or offshore.”
Over that time, the workforce, including both employees and contractors, produced approximately 200 billion cubic feet of gas, 15 million barrels of oil and 14 million barrels of gas liquids. Achieving this involved:
- Moving more than 20,000 workers to and from offshore platforms on 4,000 helicopter flights.
- Moving 2,250 tons of rig equipment between platforms.
- Cooking and serving 300,000 meals to offshore workers.
- Delivering 74,000 tons of supplies and equipment.
Owen adds that it all comes down to one thing: “Our staff and contractors working together to put safety at the center of everything we do.”
120 years of history
In 1895, six years before the Federation of Australia, Vacuum Oil Company opened an office in Melbourne with a staff of three to sell mineral lubricants.
On the first day of his first road trip as Vacuum’s first salesman, David Clarke, an engineer from Yorkshire, England, sold his first barrel of Vacuum cylinder oil to the company’s first customer, Clarence United Gold Mining Company.
Vacuum and its Mobil and ExxonMobil successors continued to build on Clarke’s firsts over the next 120 years.
Today, ExxonMobil in Australia has grown from that first sales office into a nationwide enterprise with investments of more than $20 billion. In powering Australia’s economy, it develops and pipes natural gas amounting to billions of cubic feet from the nation’s largest fields, produces and refines millions of barrels of oil, and stores and transports millions of gallons of fuel products every year.
Undoubtedly, Clarke would be highly impressed.