Australia’s Oil and Gas Exploration Set for Renaissance

Oil and gas companies operating in Australia are lining up plans to boost oil and gas exploration as activity picks up amid the energy crisis in the wake of the Iran war.

Australia, which has had to cope with a fuel supply crisis since the Middle East conflict began, is one of the world’s top LNG exporters. Still, it assesses its domestic gas availability every quarter, and the regulators have often raised an alarm over potential gas supply shortages in some parts of the country.

Energy Security Woes Prompt Renewed Exploration Efforts

The latest energy crisis has given energy companies the license to step up exploration efforts in search of both oil and gas, both onshore and offshore, to ensure domestic supply is met and LNG exports are bringing in revenues and help meet Asia’s growing gas demand.

Despite the fact that it is a major gas and LNG producer, Australia relies on imports for most of its transportation fuel supply. The situation became worse at the start of the Iran war after a fire broke out at one of the only two refineries in the country.

Since 2013, Australia has permanently closed five out of its seven refineries, which has increased its reliance on imported fuel. But the Iran war and the fuel crunch in Asia led to extraordinary measures in Australia, such as halving the fuel excise on gasoline and diesel for three months and securing shipments of diesel and gasoline, including from Brunei, South Korea, and even China.

Amid the crisis, Australia’s federal and state governments have realized that domestic oil and gas supply needs to be given the chance to rise to avoid energy crises in the future. Some of these have awarded drilling licenses and enacted reforms aimed at boosting exploration.

This year, operators are set to spend more than $1 billion on gas exploration, which would be a 10% increase compared to last year, according to estimates by Rystad Energy.

Related: US Crude Output Sets New Monthly Production Record

In the quarter to March 2026, Australia’s petroleum exploration expenditure fell by 4.8% from the December 2025 quarter, but jumped by 46.2% from a year earlier, the latest official statistics data showed.

Despite the quarter-on-quarter decline, the clear trend since last year is one of continued increase in exploration spending in both onshore and offshore drilling.

Boosting domestic gas supply is a key pillar of Australia’s energy security, and the companies and governments know it.

The public supports accelerating domestic energy development to boost energy security, according to online polling by JWS Research at the end of March. A total of 78% of Australians support producing more oil domestically to improve fuel security, 89% prefer Australia developing its own gas resources rather than importing gas, and 65% support fast-tracking local gas projects to avoid the need for imports, according to the poll shared by industry association Australian Energy Producers.

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New Resource Opportunities

Projects have a chance to be fast-tracked to exploration and potentially development as state governments have approved new drilling in recent months.

Earlier this year, the state of New South Wales launched its first natural gas exploration tender in ten years.

The Queensland government has just introduced new legislation to fast-track the development of critical minerals, energy, and other state-significant projects.

The new bill would help streamline state-significant project development and support the investment needed to bring new gas supply to market, Keld Knudsen, Queensland Director at Australian Energy Producers, said.

“Queensland has the resources and opportunities to deliver the next generation of energy projects, but investors need clear, coordinated and practical approval pathways to turn those opportunities into new projects,” Knudsen added.

There are several high-profile opportunities in Queensland and elsewhere that could unlock Australia’s next wave of oil and gas supply.

These include the Taroom Trough and the Beetaloo and Bedout Basins.

The Queensland government early this year awarded petroleum and gas exploration tenders in parts of the Taroom Trough to Omega TN Pty Ltd, Tri-Star Stonecroft Pty Ltd, and Drillsearch Energy Pty Ltd.

To date, exploration tenure holders in the Taroom Trough have committed more than US$344 million (AUS$500 million) for exploration and appraisal programs in the area, the state government said.

Then there is Australia’s largest undeveloped oil project, which could progress to a final investment decision in 2027, after years of delays, as the energy crisis amid the Iran war has heightened the need for homegrown resources.

One of the largest Australian energy firms, Santos, said in its Investor Briefing Day 2026 that it would fully appraise Australia’s Beetaloo and Bedout basins to boost supply that could be processed through existing infrastructure and facilities.

The Bedout Basin offshore Western Australia contains the Dorado discovery, which Santos operates with an 80% stake. Dorado, the largest undeveloped oil project in Australia, is a high-return, short payback-cycle project, which could boost energy security, according to Santos.

The Beetaloo Basin, for its part, is an under-appraised shale basin in the Northern Territory, and it is estimated to contain more than 430 tcf of undiscovered gas in place. Beetaloo is close to LNG export infrastructure such as Darwin LNG and Barossa.

The Santos acreage has the potential to supply up to 10 Mtpa LNG and the east coast market for more than 50 years, according to Santos, which plans development-targeted appraisal spudding in 2026.

By Tsvetana Paraskova for Oilprice.com