Bass Strait partners ExxonMobil Corp. and BHP Billiton have agreed to abandon their gas marketing joint venture for Bass Strait production after 50 years of operation.
Pressure for the break-up has come from the Australian Competition & Consumer Commission (ACCC) amid concerns about east coast gas supply and increasing prices.
Both companies have provided ACCC with court-enforceable undertakings that requires them to separately market gas from the Gippsland basin fields in offshore eastern Victoria as separate entities starting Jan. 1, 2019.
ACCC said it has been concerned that the joint marketing arrangements were likely to have resulted in a substantial lessening of competition in the marketplace for the supply of gas to buyers in Australia’s southern states.
Although the agreement has now been made for separate marketing arrangements, the two companies have always argued that joint marketing actually saved costs. They added that the cessation of this joint arrangement could make it more difficult to invest and bring on new supplies in Gippsland.
Production from the Gippsland basin joint venture is forecast to drop to 244 petajoules for 2018 from the record output of 330 petajoules for this current year.
