International energy company Chevron has paid $3 million for a cash bid permit to secure the right to explore an area off the Western Australian coast for the next six years.

The award was made as part of the Australian Government’s process of releasing offshore areas for future petroleum (oil and gas) exploration to maximise the return to the taxpayer from developing our resources.

Minister for Resources and Northern Australia Senator Matt Canavan said this was the first cash bid permit to be awarded since the process was re-introduced in 2014.

“The new permit is in a gas-rich part of the Northern Carnarvon Basin very close to the Gorgon Gas project and Pluto LNG, offshore of Western Australia between Onslow and Dampier,” Minister Canavan said.

“The awarding of this permit is an important milestone and shows that Australia remains an attractive petroleum exploration investment destination.

“The acreage release process, where petroleum companies are awarded offshore areas for exploration based on the quality and thoroughness of their proposed work plans, has long underpinned successful exploration in Australia.

“However the 2014 introduction of the cash-bidding system to allocate offshore petroleum exploration permits in mature areas or areas known to contain petroleum accumulations has provided an extra option for industry and immediate returns to the Australian people. “

Cash bidding is an equitable and efficient system of permit allocation. It also encourages more effective exploration activities in areas where only minimal further exploration may be required.

The cash-bid auction for the 2016 Offshore Petroleum Exploration Acreage Release was held on 2 February 2017. Two companies prequalified for the auction. At the close of the auction one bid was received for release area W16-7.

As a result, Exploration Permit WA-526-P was awarded to Chevron Australia New Ventures Pty Ltd.

The remaining cash bid areas, W16-22 and W16-25, did not receive bids and have reverted to vacant acreage.

The final round of the 2016 Offshore Petroleum Exploration Acreage Release will close on 23 March 2017 - http://www.petroleum-acreage.gov.au