Chevron hits more gas in Carnarvon Basin

Chevron has announced a new gas discovery in the Carnarvon Basin, a day after Woodside Petroleum disappointed the market by revealing three exploration wells originally earmarked for supply to its Pluto LNG processing plant were not fit for development.

Drilling at Chevron's Satyr-3 well hit approximately 74 metres of net gas pay, the oil and gas giant said today in a statement.

The Satyr-3 well is located in the WA-374-P exploration permit area, 182 kilometres north of Exmouth.

“Satyr-3 represents our thirteenth offshore discovery in Australia since mid-2009. This recent discovery reinforces the quality and value of our Australian exploration lease holdings in the Carnarvon Basin,” Chevron Corporation vice chairman George Kirkland said.

Chevron holds a 50 per cent stake in WA-374-P, with Exxon Mobil and Shell each holding 25 per cent.

Yesterday, Woodside announced in its fourth quarter production report that its Xeres well, along with two others, was not fit for development.

Woodside still has three more wells to drill in its campaign to find more gas for Pluto.

Analysts, however, believe Woodside will have to source gas from Exxon Mobil's Scarborough gas field or Hess' Equus to boost supply to Pluto.