Exxon Mobil Corp (NYSE:XOM, ETR:XONA)'s Australian subsidiary Esso has scaled back initial claims of a major gas discovery in the Bass Strait, significantly reducing the estimated volume and dampening optimism about a near-term solution to the east coast energy supply crunch.
The company and its joint venture partner Woodside Energy Group Ltd (ASX:WDS, LSE:WDS, OTC:WOPEF) notified the Australian Energy Market Operator (AEMO) of the discovery in the Gippsland Basin, in line with local disclosure obligations. Australia’s mandatory gas market reporting rules are more stringent than those in many other jurisdictions.
However, ExxonMobil has since revised the size of the find downwards — by as much as 70%, according to AEMO — raising questions about the initial assessment. The correction has been described as a setback for the industry, tempering early enthusiasm and proving an embarrassment for the project partners.
At 12.40pm AEST, Woodside shares were trading nearly 1% higher at A$24.05, supported by an uptick in global energy prices.