Big Oil’s Offshore Gamble: Australia’s Otway Basin Heats Up
Why a Korean Giant Just Joined the Hunt for Australian Gas
ConocoPhillips Australia (COPA) is doubling down on hydrocarbon exploration in the Otway Basin, but it’s not going alone. In a strategic pivot, the energy heavyweight has enlisted Korea National Oil Corporation (KNOC) as a partner, signaling a major push to unlock gas reserves off Australia’s southern coast. The move comes as Victoria and the East Coast face looming supply shortages—and the clock is ticking.
“This partnership isn’t just about drilling wells; it’s about securing energy for a market that’s running on fumes,” says an industry insider familiar with the deal.
The National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) greenlit COPA’s Otway Exploration Drilling Program (OEDP), approving up to six exploration wells across the VIC/P79 and T/49P offshore titles. Drilling kicks off in Q3 2025 using Transocean’s semi-submersible rig, the Transocean Equinox—a vessel built for deepwater precision. Meanwhile, the stakes are shifting: 3D Energi’s subsidiary, TDO, holds 20% of the permits, while COPA retains 80%. But KNOC’s pending acquisition of 29% will dilute COPA’s share to 51%, reshaping the venture’s dynamics.
Financially, COPA is shouldering risk to accelerate progress. The company agreed to cover up to $65 million in gross drilling costs for 3D Energi’s share, a move that underscores the project’s urgency. With Victoria’s gas supply gaps projected to hit critical levels by 2028–2029, the joint venture is racing to bring new supply online. “KNOC’s involvement isn’t just capital—it’s credibility,” notes 3D Energi’s CEO, pointing to the Korean firm’s track record in complex offshore projects from the North Sea to Southeast Asia.
The Geopolitical Calculus Behind the Drill Bits
For KNOC, the Otway Basin is more than a financial play. As South Korea diversifies its energy portfolio amid global volatility, Australia’s stable regulatory environment and untapped reserves offer a rare sweet spot. The partnership also hedges against supply chain disruptions, a lesson sharpened by recent geopolitical shocks. “LNG markets are tighter than ever,” says a Seoul-based analyst. “KNOC isn’t just buying equity—it’s buying insurance.”
“The East Coast gas crisis isn’t coming—it’s already here. Projects like this are Band-Aids on a bullet wound unless they scale fast,” warns a Melbourne energy consultant.
Yet challenges loom. Environmental groups are scrutinizing NOPSEMA’s approval, citing risks to marine ecosystems in the Otway Basin, a region known for its biodiverse seamounts. COPA’s pledge to use “best-in-class” mitigation tech may not placate critics. Meanwhile, the clock ticks toward 2025: if the Transocean Equinox hits delays or dry wells, Australia’s energy security math gets uglier. One thing’s certain—the Otway Basin just became a litmus test for how fast big oil can adapt to a hungry market.
