According to recent media reports, BP plc’s (BP - Free Report) project to drill for oil in the Great Australian Bight is likely to be deferred yet again. Australian regulators have requested the oil giant to provide additional information related to the environmental programs for drilling in the area, thereby raising the possibility of further delays.
The Great Australian Bight is a stretch of the coastline in the southern part of the continent that is rich in wildlife. Though BP’s drilling plans in the area do not run the risk of being rejected by Australia’s regulators, the need to provide more information will undoubtedly delay the company’s drilling program. In fact, this is the third time that the regulators have asked for more facts related to the drilling plan.
Great Australian Bight is among the most significant sources of oil in the world. Given that the area is still largely unexplored by the company, it holds immense potential. According to BP, the geology of Mississippi Delta – where the many energy players are producing oil and gas for years – might be similar to Great Australian Bight.
The Great Australian Bight has a unique ecosystem that houses whales, sea lions and other wildlife and hence, environmental groups remain skeptical regarding drilling projects in the area. In fact, most environmentalists are of the opinion that the project is extremely risky for the environment of coastal communities in this region.
London-based BP is one of the world's major integrated energy companies involved in both upstream and downstream operations. In terms of assets, BP owns a strong and diversified portfolio of global energy businesses that offer attractive long-term growth opportunities. The group’s strong inventory of development projects should help volume growth in the long run.
BP PLC Price
Although oil prices rose more than 5% on Sep 28, it is way below the level it was trading during mid-2014. Most energy players involved in upstream business, such as Exxon Mobil Corporation (XOM - Free Report) , Chevron Corporation (CVX - Free Report) and Royal Dutch Shell plc (RDS.A - Free Report) , have been reeling under the persistent oil price weakness and BP is no exception.
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