Australia Boosts Oil and Gas Exploration to Secure Energy Supply

In a strategic response to global energy market volatility, Australian oil and gas companies are planning increased exploration activities as the sector experiences renewed momentum amid the post-Iran War energy crisis. As one of the world's leading LNG exporters, Australia has confronted significant energy supply challenges since the commencement of Middle East conflicts. Despite these challenges, the nation continues to assess domestic gas supply conditions quarterly, with regulatory agencies frequently issuing warnings about potential gas shortages in certain regions.

Energy Crisis Drives New Exploration Efforts

The recent energy crisis has effectively provided energy companies with a "license" to intensify exploration efforts both onshore and offshore to secure domestic supply and LNG export revenues while meeting Asia's growing natural gas demand.

Despite being a major producer of gas and LNG, Australia remains dependent on imports for the majority of its transportation fuel needs. The situation worsened at the onset of the Iran War following the fire at one of the country's only two oil refineries. Since 2013, Australia has permanently closed five of its seven oil refineries, increasing dependence on imported fuel. However, the Iran War and fuel scarcity in Asia have led to extraordinary measures in Australia, such as halving the excise tax on gasoline and diesel for three months and securing diesel and gasoline shipments from Brunei, South Korea, and even China.

Australia Energy Situation Summary

Amid the crisis, both federal and state Australian governments have recognized the need to develop domestic oil and gas resources to prevent future energy crises. Several states have awarded drilling permits and implemented reforms to encourage exploration. According to Rystad Energy estimates, operators will spend over $1 billion on gas exploration this year, a 10% increase from the previous year.

Oil and Gas Exploration Spending Data

According to the latest official statistics, in the quarter ending March 2026, Australia's oil and gas exploration spending decreased by 4.8% compared to Q4 2025, but increased by 46.2% compared to the same period last year. Despite this quarterly decline, the clear trend since last year has been continuous growth in exploration spending both onshore and offshore.

Oil and Gas Exploration Spending Trends (USD Billions)

Increasing domestic gas supply is a cornerstone of Australia's energy security, and both companies and the government recognize this. According to an online survey by JWS Research conducted in late March, the public supports accelerating domestic energy development to enhance energy security.

Australian Public Survey Results

New Resource Opportunities

Projects have the potential to be fast-tracked from exploration to development as state governments have approved new drilling in recent months. Earlier this year, New South Wales state launched its first gas exploration in a decade. Queensland's government has recently introduced new legislation to expedite the development of critical minerals, energy, and other important projects in the state.

"Queensland has the resources and opportunity to deliver next-generation energy projects, but investors need clear, coordinated, and practical approval pathways to turn those opportunities into new projects," said Keld Knudsen, Queensland Director at Australian Energy Producers.

Several promising opportunities in Queensland and elsewhere could unlock Australia's next wave of oil and gas supply. These projects include the Taroom Trough, Beetaloo and Bedout basins.

Early this year, Queensland's government awarded oil and gas exploration blocks in several areas of the Taroom Trough to Omega TN Pty Ltd, Tri-Star Stonecroft Pty Ltd, and Drillsearch Energy Pty Ltd. To date, exploration permit holders in the Taroom Trough have committed over $500 million to exploration and evaluation programs in the region, according to the state government.

Major Oil Projects Awaiting Investment Decisions

There is also Australia's largest undeveloped oil project, which could proceed to a final investment decision in 2027 after years of delays, as the Iran War energy crisis has increased demand for domestic resources. One of Australia's largest energy companies, Santos, stated at its 2026 Investor Day that it would fully evaluate Australia's Beetaloo and Bedout basins to increase supply that could be processed through existing infrastructure and facilities.

The offshore Bedout basin in Western Australia contains the Dorado discovery, in which Santos operates with an 80% interest. Dorado, Australia's largest undeveloped oil project, is a high-return, short-payback project that could enhance energy security, according to Santos.

The Beetaloo basin, meanwhile, is an unassessed shale basin in the Northern Territory, estimated to contain over 430 tcf of undiscovered gas. Beetaloo is near existing LNG export infrastructure such as Darwin LNG and Barossa. According to Santos, its acreage has the potential to supply up to 10 Mtpa of LNG and the east coast market for more than 50 years. Santos expects to begin targeted development appraisal drilling in 2026.

The increased exploration and development of domestic oil and gas resources represents not merely a crisis response but a long-term strategy to ensure energy security for Australia—a nation that is both a major energy exporter and dependent on imported transportation fuels.