State Resources minister Francis Logan announced the release of the West Erregulla block, east of Dongara in the Dandaragan Trough, on Friday.
He said West Erregulla was believed to contain more than 11 billion cubic metres of gas (388Bcf) – enough gas to meet WA’s entire domestic gas demand for more than one year.
“This tight gas prospect has attracted interest in recent times, particularly with profitable gas prices and a predicted domestic gas shortage,” Logan said.
“If the successful bidder discovers there is enough gas for commercial rates and it goes smoothly through all approvals, it is possible that gas could be supplied to the domestic market within two to five years.
Logan said the WA Government was encouraging more exploration and development in order to avert a domestic gas shortage, forecast to occur between 2008 and 2014.
“While Australia’s petroleum industry does not have a lot of known expertise in the ‘tight gas’ field, it is more common in other regions,” the Minister said.
“We are fortunate in WA to have large reserves of easy-to-access gas, so our tight gas resources have been largely ignored. But with the market doing so well and the looming domestic gas shortage, tight gas is looking more favourable.”
Bids for the West Erregulla application area close on January 31.
‘Tight gas’ is found in rocks with a low permeability, making it hard to extract and requiring specialised drilling and fracture techniques.
Substantial tight gas reserves are known to exist in the South-West and Lower Mid-West, but were previously thought to be economically unviable.
WA’s best known tight gas field is probably Whicher Range, near Busselton, which is believed to contain more than a trillion cubic feet of gas.