ACCESS to a south-west natural gas reserve that could rival that of Bass Strait at its peak is being blocked by the state government’s decision to extend the moratorium on onshore exploration of conventional gases, an exploration company says.
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Lakes Oil chief executive Roland Sleeman said it was not concerned about the state government’s decision this week to permanently ban the practice of fracking, used to access unconventional gases, but extending the moratorium on onshore exploration of conventional gases until 2020 “hits us hard”.
The government’s decision forced the publicly listed company to briefly halt trading of its shares this week.
Mr Sleeman said drilling onshore for conventional gases had been done without problems for many years in Victoria until resources were depleted and there was no reason to ban it.
He said his company had an exploration permit to drill the Eumerella formation, north of Port Fairy, but was unable to use it because of the moratorium.
Historical exploration and seismic information indicated gas reserves in the Eumeralla formation could potentially rival those of Bass Strait in their heyday, Mr Sleeman said.
Lakes Oil chairman Chris Tonkin said the extension of the moratorium would keep gas prices high for Victorian householders, who were the most dependent in Australia on gas for environmentally friendly and efficient heating and hot water.
It would also reduce the attractiveness of Victoria as an investment destination and reduce job opportunities, Mr Tonkin said.
Another opponent of the extension to the moratorium was Corangamite Shire Council, that said it believed the shire could receive big benefits from tapping into onshore conventional gas reserves.
Corangamite mayor Jo Beard said further study was needed because onshore conventional gas reserves could provide cheaper energy for dairy processors and help the regional dairy sector stay competitive in the global market.
She said Corangamite Shire had a good understanding of the gas industry because there were three processing plants associated with offshore gas delivery in its region.
Ms Beard said the council would continue to lobby the state government for a strategy that would provide rural industries with cheap energy.