Australian-listed gas company Amplitude Energy will buy fellow domestic independent Beach Energy's operatorship and a 50pc stake in the Artisan gas field in Victoria state's offshore Otway basin.
The firm will spend A$58.3mn ($41.8mn) on the VIC/L35 permit southwest of Victoria's capital Melbourne, it said on 25 May, while the remaining 10pc of Beach's holding will be purchased by Israeli energy firm OG Energy which already owns a 40pc interest.
The payment is equivalent to A$2/GJ ($1.51/mn Btu), fully funded through existing funds, while a A$3.75/GJ royalty payment will be capped at 62PJ gross, or 31PJ net to Amplitude, Amplitude said. The transaction is expected to be completed in July-September.
"Artisan development costs will significantly benefit from leveraging the existing east coast gas supply project (ECSP) program and our readily available infrastructure," Amplitude chief executive Jane Norman said, referring to the Casino-Henry-Netherby pipeline which Artisan wells could tie-in to.
Along with the Annie field, Artisan will provide the base resource for Amplitude and OG's ECSP, a 50:50 joint venture which it now plans to make a final investment decision for in the coming months, Norman said.
Drilling the Juliet-1 well is now expected to start in late July or early August, to be followed by the Annie-2 well. Amplitude received an offshore gas production licence for Annie earlier this month.
The ECSP is targeting increases in output by the Amplitude-operated Athena gas plant of between four- and seven-times of current output of about 14 TJ/d (370,000 m³/d), against nameplate capacity of 150 TJ/d.
Australia's east is facing a gas supply shortfall later this decade as existing gas plants associated with the Gippsland basin joint venture close due to declining feedstock.
LNG imports, greater storage, local production and a gas reservation policy may reduce this deficit.
Beach to cancel drilling
Meanwhile, Beach's La Bella-2 well will no longer be drilled as part of the Equinox phase 2 campaign, the company said today, allowing it to redirect capital to other priorities.
Offloading Artisan and not drilling La Bella will unlock over A$500mn in planned spending between the 2025-26 and 2028-29 fiscal years to 30 June, chief executive Brett Woods said, with the money to be directed to opportunities with stronger returns and lower development costs.
Beach will seek large-scale opportunities due to the relatively expensive nature of developing Otway basin assets, Woods said in August last year.
Beach drilled the A$61mn Hercules-1 exploration well in the Otway basin in September 2025, which failed to locate significant hydrocarbons and was plugged and abandoned.
The Adelaide-based firm recently acquired a 25pc share in a 750km² exploration permit in the onshore Taroom trough of Queensland state, a jurisdiction seeking to increase its oil and gas output, indicating it sees growth opportunities in the region.
