BP shelves Great Australia Bight exploration, Dudley eyes $55-$70 oil

(ShareCast News) - In the face of staunch environmental protests, BP has decided to shelve its exploration drilling programme in the Great Australian Bight in order to channel capital into more profitable opportunities. After reviewing its upstream options, BP, whose chief executive Bob Dudley told the World Energy Congress on Tuesday he expects global oil prices to hover around $55-$70 per barrel for the rest of the decade, calculated that the GAB project offshore South Australia "will not be able to compete" for capital "in the foreseeable future"."We have looked long and hard at our exploration plans for the Great Australian Bight but, in the current external environment, we will only pursue frontier exploration opportunities if they are competitive and aligned to our strategic goals. After extensive and careful consideration, this has proven not to be the case for our project to explore in the Bight," said Claire Fitzpatrick, BP Australia's managing director for exploration and production."This decision isn't a result of a change in our view of the prospectivity of the region, nor of the ongoing regulatory process run by the independent regulator NOPSEMA. It is an outcome of our strategy and the relative competitiveness of this project in our portfolio."The Bight project, which BP once thought would have the oilfield potential to match the Gulf of Mexico, has been rejected three times by the Australian regulator - the National Offshore Petroleum Safety and Environmental Management Authority (Nopsema).Environmental concerns have dogged the project, with a recent modelling by BP finding that an uncontrolled oil spill from the planned wells could affect the coastline as far away as New South Wales, according to previously secret oil-spill modelling uploaded to the company's website this week.Within 24 hours of the modelling being uploaded to BP's website, the regulator, the National Offshore Petroleum Safety and Environmental Management Authority (Nopsema) announced it would take a further 10 days to assess BP's plans to drill in the area.