At its AGM, Origin Energy Chairperson Scott Perkins stated the company would exit its oil and gas holdings in the Kimberley region.
Origin signed a farm-in agreement with Buru Energy in December 2020 for seven licences covering 20,000km2 in Western Australia’s Canning Basin in the Kimberley.
“Origin will now hold positions in three large prospective onshore basins – the Beetaloo, Canning, and Cooper-Eromanga – giving us exposure to conventional and unconventional gas plays and what we believe are the most prospective shale formations in Australia,” Origin said when the farm-in agreement was announced.
Environs Kimberley stated it would be necessary to frack Kimberley’s unconventional gas play. Fracking is heavily contested globally and is prohibited in several nations, the organisation added.
“The total estimated spend by Origin ever a two-year period is expected to be approximately $35 million inclusive of a two-well drilling program and seismic work,” Origin said.
At the AGM, Perkins was asked by a shareholder if he had known prior to entering into the joint venture with Buru Energy, if Origin had knowledge of the significant opposition to fracking in Kimberley’s Canning Basin.
“These permits are currently part of the strategic review, and our intention is to exit these permits over time. Our decision to co-invest alongside Buru as the operator of those activities was, we think, an entirely appropriate one. Third point I’d make is, as with the Northern Territory scientific study supported by the CSIRO into the safety of fracking, we think there is ample, ample scientifically based evidence to support the safety of fracking in appropriate circumstances,” Perkins said.
Environs Kimberley, a conservation organisation based in Broome, has welcomed the news.
“This is a very sensible decision by Origin. The oil and gas industry has never gained a social licence to undertake fracking in the Kimberley,” Environs Kimberley Director Martin Pritchard stated.
Pritchard added that the region, which has a tourism sector worth over $500 million and employs over 1,600 people, or 10 per cent of the workforce, is incompatible with the natural and cultural values of the region due to the industry’s carbon emissions, use of harmful chemicals, and landscape-scale damage.
“They got the message that fracking the Kimberley would mean significant reputational damage, particularly for companies like Australian Super, which is the largest investor in the company,” Pritchard said.
According to Pritchard, the Origin exit makes it abundantly clear to investors that fracking in the Kimberley is a bad investment and will eventually become a stranded asset.
