The Australian government has opened five new offshore areas for gas exploration in the Otway basin to address future supply shortfalls and support energy affordability. Three areas are offshore northwest Tasmania and two are offshore Victoria, situated in Commonwealth waters near existing infrastructure and demand centres. The release is designed with buffer zones to protect marine parks, and all projects must meet strict environmental standards.

Improved Geological Data and Remaining Challenges

Significant improvements have been made to the seismic and geological data for the deepwater Otway basin since 2020. Previously limited to approximately 100-kilometre line spacing, new acquisition and reprocessing efforts, including over 7000 line kilometres of 2D seismic by SLB, have improved resolution to about 10-kilometre spacing in most areas. A comprehensive re-evaluation from 2020 to 2024 integrated this new data with legacy information. However, challenges remain due to a lack of well control in deepwater areas and difficulties correlating data from existing wells because of structural complexity. The government advises potential investors to assess if further seismic acquisition is needed for targeted work programmes.

Regulatory Framework and Consultation Process

The acreage release follows a review of the offshore exploration system and extensive consultation. Public consultation on the nominated areas is open until 6 February 2026, with exploration permit applications closing on 30 June 2026. The release is coordinated with the Victorian state government under a joint authority regime. Revised guidelines for retention leases and work-bid programmes have also been published. Companies are directed to consult on mitigating risks to underwater cultural heritage and are warned that exploration areas may coincide with defence zones containing unexploded ordnance.

Strategic Rationale and Industry Response

The government states this action supports its Future Gas Strategy and is a response to structural gas shortfalls forecast from 2029 by key market bodies. It aims to ensure affordable gas for households and for manufacturers who rely on gas as a feedstock or heat source. Industry representatives welcomed the move, affirming that exploration is a critical first step for long-term energy security and noting complementary actions by the Victorian government. The release is seen as essential for maintaining a pipeline of new supply projects as Australia works towards its net zero commitments.