Low oil prices – including a brief foray into negative territory – have impacted on the oil and gas industry with even supermajors moving to slash capital expenditure.

Shell plans to lower its spending by $US5bn ($7.8bn), BP is cutting its capital spending by 25 per cent to $US12bn while ExxonMobil is reducing its capex by almost a third to $US23bn.

Despite this, the Australian government has opened public consultation on 49 potential areas for the 2020 offshore petroleum exploration acreage release.

Minister for Resources, Water and Northern Australia Keith Pitt said the areas offshore Western Australia, Northern Territory, Victoria and the Territory of the Ashmore and Cartier Islands were nominated by the oil and gas industry.

“The continuing release of offshore acreage for petroleum exploration is a crucial way of attracting investment in Australia resources sector and strengthening the economy for the good of all Australians,” Pitt said.

“Continued resources exploration, be it offshore or onshore, provides for a strong and sustainable resources sector which will lead Australia’s bounce back from the COVID-19 pandemic.”

The public consultation process provides stakeholders with the opportunity to comment on nominated areas and to highlight if they may be affected by exploration activities.

This will inform petroleum explorers of specific issues or concerns which can be taken into account when planning exploration activities.

Bidding for the 2019 offshore acreage release closed on March 5, 2020 and it’s unknown what the response to last year’s round is like.

However, Australian offshore exploration took a blow earlier this year after Norwegian oil major Equinor decided to pull out of exploration in the Great Australian Bight.

While the company said the decision was motivated by commercial reasons, environmental groups were quick to claim victory.

Equinor is notably conscious of its environmental footprint with the company having a target of reducing its net carbon intensity by at least 50 per cent by 2050.

The Australian government has not been sitting still either.

Just last month, it threw existing offshore oil and gas explorers a lifeline, offering them a simplified application process to suspend and extend existing work programs, as well as further flexibility to be applied to well expectations in the renewal of exploration permits.

And while oil and gas demand is currently constrained by the impact of the COVID-19 pandemic, there will still be considerable demand for fossil fuels once the global economy regains its footing as renewable energy is still some way from becoming the main stay of the energy mix.