The Victorian and federal governments have given the green light for a company to commence drilling for offshore gas in the vicinity of the Twelve Apostles.
Amplitude Energy, the Australian energy firm behind the initiative, has indicated that the drilling site, located approximately 9 kilometers from Port Campbell, is projected to meet around 4 percent of the gas requirements for the Australian east coast over a five-year timeframe.
Operations are slated to begin next year, with gas production anticipated to start in 2028.
This project, known as the Annie Gas Field Project, is set to take place about 9 kilometers off the coasts of Peterborough and Port Campbell, near the renowned tourist attraction of the Twelve Apostles. Amplitude Energy, listed on the ASX, plans to start work next year, expecting to deliver gas supplies starting in 2028.
The company has stated that its production will span five years, contributing roughly 4 percent of the east coast’s gas demands during that period. This development occurs amidst concerns regarding a potential gas supply shortage in Victoria, as traditional sources in the Bass Strait are diminishing.
The Victorian government is also actively pursuing a transition for households and businesses from gas to electric energy sources. Victorian Energy and Resources Minister Lily D’Ambrosio emphasized the government’s commitment to managing this energy transition in a “responsible” manner.
“This approval facilitates access to more affordable, locally sourced gas for Victorians, ensuring a reliable supply for industries that continue to depend on gas,” she stated.
According to the government, the project is expected to support energy needs for sectors that may not have viable electric alternatives yet.
Federal Resources Minister Madeleine King added that the gas produced would be designated solely for domestic consumption, aiming to mitigate the risk of potential supply shortages.
Moreover, the federal government is also inviting proposals for new offshore exploration areas in Tasmania and the Gippsland and Bass basins of Victoria.
This decision is likely to provoke backlash from environmental advocates, who have previously opposed new drilling activities along the southwestern Victorian coastline. The Victorian Greens have voiced their disapproval, arguing that the government should refrain from endorsing fossil fuel initiatives that hinder the energy transition.
A representative from Amplitude Energy highlighted that the project underwent extensive community engagement and noted that gas extraction has coexisted in the area for over 20 years alongside tourism, agriculture, and other small businesses.
The representative further assured that the project would minimally affect the visual landscape near the Twelve Apostles, as the infrastructure would be located below the surface, making it largely invisible except during the temporary drilling phase.
Meanwhile, the Australian Energy Market Operator (AEMO) has postponed its peak-day gas shortfall predictions to 2029, citing reduced gas consumption and increased supply on peak days as contributing factors to improved availability.
Despite this, AEMO still maintains that investment in gas is crucial to prevent future shortages, a claim that has been challenged by certain energy analysts. The organization projects that Victoria’s annual gas production could decline by 52 percent by 2030, while annual consumption is expected to decrease by 10.5 percent during the same period.
The Victorian Chamber of Commerce and Industry has welcomed the approval of the Otway Basin project, believing it will enhance business confidence amid the ongoing energy transition. Acting Chief Executive Amelia Bitsis remarked that businesses are currently grappling with significant challenges regarding energy costs and supply reliability.
“This represents a positive and sensible advancement towards ensuring that Victoria has a dependable and affordable energy supply, crucial for both businesses and households during the transition to net zero,” she stated.
However, other gas exploration initiatives in the Otway Basin have sparked controversy among coastal communities and environmental groups, who are concerned about potential ecological repercussions and contest the assertion that Victoria is facing a gas shortage.
