Reconsidering the Depths: The Shifting Tides of Offshore Economics

The narrative surrounding deepwater exploration had, for some time, been overshadowed by concerns over high costs, environmental risks, and the perceived inevitability of a rapid transition away from fossil fuels. Yet, as global energy demand continues to climb, exacerbated by industrial growth and population expansion, the need for reliable, scalable energy sources remains paramount. The recent volatility in global energy markets, highlighted by geopolitical tensions and supply chain disruptions, has unequivocally underscored the strategic importance of diverse energy portfolios. This environment has served as a powerful catalyst, prompting a thorough re-evaluation of offshore economics.

Initially, the sheer scale of investment and the extended timelines associated with deepwater development made these ventures appear less attractive than quicker, often less capital-intensive onshore alternatives. However, the industry has learned valuable lessons. Rigorous cost-cutting measures, supply chain optimizations, and a relentless pursuit of efficiency have significantly reduced the break-even points for many deepwater projects. What was once considered a prohibitive frontier is now being approached with renewed financial prudence and technological sophistication. This recalibration is not just about higher oil prices making projects profitable; it’s about a structural improvement in how these massive undertakings are planned, executed, and managed, leading to better returns on oil and gas investment even at moderate commodity prices.

The Unseen Advantage: Technological Prowess and Deeper Horizons

A critical enabler of this offshore drilling revival is the breathtaking pace of technological advancement. The industry has continually pushed the boundaries of what is technically feasible and economically viable in some of the planet’s most extreme environments. Innovations span the entire upstream energy value chain, from initial offshore oilexploration to extraction and transport.

Advancements in Seismic Imaging and Reservoir Characterization

Consider the evolution of seismic imaging. What was once a blurry snapshot of the subsurface is now a high-definition, three-dimensional, and even four-dimensional view of complex geological structures. Full-waveform inversion (FWI) and other advanced processing techniques allow geophysicists to map reservoirs with unprecedented accuracy, reducing drilling uncertainty and optimizing well placement. This precision translates directly into higher success rates and greater resource recovery, profoundly impacting deepwater projects where every well costs tens of millions, if not hundreds of millions, of dollars. Better understanding of the subsurface means less dry holes and more productive wells, fundamentally improving the project’s economic viability.

Engineering Marvels in Drilling and Subsea Infrastructure

Beyond imaging, drilling technology itself has undergone a revolution. Ultra-deepwater rigs are now capable of operating in water depths exceeding 10,000 feet, reaching total depths of over 40,000 feet below the seabed. These aren’t just bigger machines; they incorporate advanced automation, real-time data analytics, and enhanced safety systems that improve operational efficiency and mitigate risks. Furthermore, subsea production systems have become increasingly sophisticated and reliable. Instead of requiring costly surface platforms for every well, clusters of wells can be tied back to existing infrastructure or floating production storage and offloading (FPSO) units through extensive networks of risers and flowlines, drastically reducing infrastructure costs and environmental footprint. This distributed architecture is key to making challenging deepwater development projects feasible.

Geographic Hotspots and the Hunt for New Offshore Reserves

The offshore drilling revival is not uniform across the globe but is rather concentrated in regions offering significant potential for new offshore reserves and favorable regulatory environments. The Gulf of Mexico, a traditional stronghold, continues to see robust activity, with major lease sales and new project sanctions. Brazil, with its prolific pre-salt discoveries, remains a powerhouse in deepwater projects, attracting substantial oil and gas investment from international majors looking to expand their portfolios in proven basins.

Beyond these established giants, emerging frontiers are also capturing significant attention. The Guyana-Suriname basin, for instance, has become one of the world’s hottest offshore oil exploration plays, with multiple super-giant discoveries transforming the economic outlook of these nations. Similarly, parts of West Africa, notably Angola and Namibia, are experiencing renewed interest, leveraging existing infrastructure and tapping into new, prospective areas. The Mediterranean and parts of Asia are also seeing targeted deepwater development efforts, driven by both energy security imperatives and the allure of significant, undeveloped hydrocarbon potential. These geographic hotspots underscore a strategic intent to secure long-term supply, capitalizing on improved offshore economics  and technological capabilities.

Major Players and Strategic Investments: Anchoring the Upstream Energy Future

The commitment of major international oil companies (IOCs) and national oil companies (NOCs) is central to this offshore drilling revival. Despite mounting pressure to transition towards cleaner energy sources, these companies recognize the enduring necessity of hydrocarbons to meet global energy needs for decades to come. Their investment strategies are becoming more discerning, focusing on high-return, lower-carbon-intensity deepwater projects that can leverage existing infrastructure and expertise.

Companies like ExxonMobil, Shell, Chevron, and TotalEnergies are allocating significant portions of their oil and gas investment capital towards upstream energy developments in deepwater. They are doing so not out of a denial of climate change, but from a pragmatic understanding of global energy realities. These deepwater projects often boast lower carbon intensity per barrel compared to some onshore operations, due to efficiencies of scale, advanced equipment, and stricter operational standards. Furthermore, the long production lifetimes of deepwater fields make them attractive for securing energy supplies over multiple decades, providing stability in volatile markets. This strategic long-term view underscores the confidence in the future of these assets, even amidst the broader energy transition.

The Balancing Act: Revival Amidst Energy Transition

It is imperative to contextualize this offshore drilling revival within the broader global energy transition. The world is unequivocally moving towards a lower-carbon future, with renewable energy sources playing an increasingly dominant role. However, this transition is complex, lengthy, and uneven. Renewables, while growing rapidly, cannot yet independently meet the entirety of global energy demand, especially for base-load power, industrial processes, and transportation sectors.

Hydrocarbons, therefore, will continue to be a vital component of the energy mix for the foreseeable future. The offshore drilling revival is, in many ways, an acknowledgment of this reality. Rather than signaling a retreat from climate commitments, it reflects a dual strategy: investing heavily in renewable energy and decarbonization technologies, while simultaneously ensuring a stable, efficient, and responsibly produced supply of conventional fuels to bridge the transition. For many nations, securing domestic offshore reserves is also a matter of national energy security and economic stability, reducing reliance on politically sensitive imports. The focus is increasingly on “advantaged barrels”, those extracted with the lowest possible emissions and highest efficiency, a category into which many modern deepwater projects now fall.

Environmental Stewardship and Future-Proofing Deepwater Development

While the economic rationale for deepwater development is strong, the environmental considerations are equally significant. The industry has made substantial strides in environmental stewardship, driven by lessons learned from past incidents and increasingly stringent regulatory frameworks. Modern deepwater projects incorporate advanced spill prevention technologies, real-time environmental monitoring, and robust emergency response plans. The goal is not just to extract hydrocarbons efficiently but to do so with minimal impact on marine ecosystems. Furthermore, research into integrating carbon capture and storage technologies, and exploring opportunities for electrifying offshore platforms to reduce operational emissions, signifies a proactive approach to future-proofing these upstream energy assets within a decarbonizing world.

In conclusion, Oil & Gas Advancement recognises the offshore drilling revival as a multi-faceted phenomenon, deeply rooted in evolving offshore economics, propelled by advanced technology, and validated by strategic oil and gas investment in deepwater projects. It represents a pragmatic response to persistent global energy demand and the critical need for energy security, all while navigating the complexities of the energy transition. The deep sea, once viewed with dwindling commercial prospects, is re-emerging as a vital frontier for securing the reliable energy supplies essential for powering the modern world. This strategic shift underscores a renewed confidence in the sector’s ability to deliver essential resources responsibly, positioning deepwater projects as indispensable contributors to the global energy mosaic for decades to come.

Once operational, the Raia gas project is expected to deliver up to 16 million cubic metres of natural gas per day. This output could account for around 15% of Brazil’s natural gas demand, strengthening national energy security while also contributing to Equinor’s international equity production and long-term cashflow. The project is operated by Equinor (35%) in partnership with Repsol Sinopec Brasil (35%) and Petrobras (30%). The drilling work builds on the partners’ extensive deepwater expertise, including prior collaboration on the Bacalhau field, where the same drillship previously participated.

Alongside drilling, work continues on integrating and preparing the floating production, storage and offloading unit (FPSO), a central component of the Raia gas project’s development concept. The FPSO will process oil/condensate and gas produced from subsea wells.

Natural gas from the Raia gas project will be transported via a 200-kilometre pipeline linking the FPSO to Cabiúnas in Macaé, Rio de Janeiro state. With a total investment of around USD 9 billion, the development represents Equinor’s largest international commitment to date. The FPSO is projected to rank among the most carbon-efficient globally, with average CO₂ emissions intensity of approximately 6 kg per barrel of oil equivalent.

“Raia is Equinor’s largest project under execution and marks the deepest water depth operation in our portfolio. Together with our partners and suppliers, we are applying world-class technology and decades of offshore expertise. While drilling takes place, integration and commissioning activities on the FPSO are progressing well putting us on track towards a safe start of operations in 2028”, Says Geir Tungesvik, executive vice president, Projects, Drilling and Procurement.

Commenting on the development, Woodside Acting CEO Liz Westcott said the launch of the drilling activities represents an important moment both for the Trion Project and for the country’s offshore energy industry. He further added that the Trion project presents an opportunity to “enhance Mexico’s energy security, build local capability and generate enduring economic value for the country.” The Trion drilling campaign forms a central part of the project’s development strategy and includes the execution of 24 subsea wells. These wells will be connected to a floating production unit (FPU) named Tláloc, which has a nameplate capacity of approximately 100,000 barrels per day. The development also includes subsea infrastructure and export systems designed to support safe and reliable offshore operations. Oil produced from the field will be transferred to a floating storage and offloading facility (FSO) named Chalchi, which has a storage capacity of 950,000 barrels.

Drilling operations for the Trion drilling campaign will be carried out using Transocean’s Deepwater Thalassa drilling vessel. The vessel will be supported by supply ships and logistics services operating from ports in the state of Tamaulipas, reinforcing local and regional supply chains linked to the project. The Deepwater Thalassa reached Mexican waters on 5 March 2026. Since the project’s FID for Trion, engineering work, procurement activities and operational planning have advanced in accordance with the established development schedule. According to the current timeline, the project remains on track to achieve first oil in 2028.

Woodside Vice President Trion Stephane Drouaud stated that work on the project is progressing “safely and systematically” through the various stages of engineering, planning and drilling execution. The Trion development is also expected to generate notable economic benefits, including direct and indirect employment opportunities as well as increased participation by Mexican suppliers. Over the lifetime of the project, Trion is projected to deliver more than US$10 billion in taxes and royalties to Mexico.

Using a play-based assessment methodology, the 2026 National Assessment estimates a mean Undiscovered Technically Recoverable Resource of 65.80 billion barrels of oil and 218.43 trillion cubic feet of natural gas across the Outer Continental Shelf. These estimates highlight the significant scale of U.S. undiscovered offshore reserves, offering a perspective on the long-term energy potential of the region. According to the report, current production trends indicate that these undiscovered resources could support 100 or more years of energy production from the shelf. Such capacity underscores the strategic importance of offshore resources in helping meet future demand while supporting employment opportunities and maintaining stable energy supplies.

“The Outer Continental Shelf holds tremendous resource potential,” said BOEM Acting Director Matt Giacona. The methodology behind the assessment involves analyzing each geologic play across the Outer Continental Shelf and assigning probabilities regarding the presence of undiscovered oil and gas resources within individual plays. Results from these analyses are subsequently aggregated to generate regional estimates, which are then combined to form an overall estimate for the entire Outer Continental Shelf. Through this process, the assessment provides a structured evaluation of U.S. undiscovered offshore reserves, offering insight into where resources may be located and how significant those deposits could be.

The 2026 National Assessment represents a comprehensive evaluation based on detailed scientific analysis and the best available data and information. It builds upon earlier Outer Continental Shelf resource assessments and forms part of a continuing effort to refine the understanding of offshore energy potential. As a result, the report serves as a key analytical resource for guiding decisions related to offshore exploration and development. By delivering updated data and insights into U.S. undiscovered offshore reserves, the assessment is positioned as an important reference for shaping the nation’s long-term energy strategy and maintaining the United States’ role as a major global energy producer.

In the Mediterranean Sea, operations at the West El-Burullus (WEB) offshore field have advanced with the second well officially entering the production map. The addition of this well has lifted the field’s output from around 25 million cubic feet per day (mmcf/d) to approximately 37 mmcf/d. Development and production at the site are being carried out through a local joint-venture vehicle, PetroWeb, with Cheiron serving as the operator and lead developer. Production is expected to rise further, surpassing 70 mmcf/d of natural gas once the third well is connected in the coming days. Meanwhile, drilling work on the fourth well has already been completed, delivering encouraging results. Preparations are currently underway to conduct evaluative tests to determine its performance.

The broader field development strategy also includes additional drilling activity on the ‘Papyrus’ platform, which is connected to the WEB platform. Plans call for the drilling of two more wells at this facility. The objective of the initiative is to maximize the utilization of hydrocarbon resources within the concession area while accelerating production timelines. These developments demonstrate continued investment in offshore assets located in the Mediterranean Sea and Western Desert, strengthening the country’s production capabilities.

In parallel with offshore activities, BAPETCO is advancing its development program across its concession areas in the Western Desert. As part of this initiative, the company has successfully drilled well BED 15-35, which forms part of the ongoing development of the BED 15-31 discovery. Production tests conducted at the site have indicated output ranging between 10 mmcf/d and 15 mmcf/d of natural gas, alongside condensate volumes of 300 barrels per day (bpd) to 650 bpd. These results have helped increase proven reserves in the area from 15 billion cubic feet (bcf) to approximately 25 bcf of natural gas. Looking ahead, four additional production wells are scheduled for drilling within the Badr El Din concession area.

The expansion is intended to boost output and maximize the recovery of discovered reserves, reinforcing the role of the Mediterranean Sea and Western Desert developments in supporting the Ministry of Petroleum and Mineral Resources’ efforts to reduce the import bill and strengthen national energy security.

Interestingly, the system makes use of real-time data along with artificial intelligence algorithms in order to track equipment performance, check out any potential failures in advance, and also schedule maintenance much before the issues take place. The approach is crafted in such a way so as to cut any unplanned downtime and decrease the maintenance expenditures.

The Saipem 12000, which is apparently described by the company as being one of the most technologically advanced drillships that’s in operation, happens to be the first vessel in the drilling fleet of Saipem that adopts the new platform. The solution was developed in collaboration with ADC Energy, which is a specialist when it comes to rig and vessel assurance.

It is well to be noted that continuous data analysis helps with the early detection of anomalies and also supports the targeted interventions, hence elevating the level of dependence on the asset and its safety, Saipem said. This initiative happens to be a pilot project that mixes the offshore engineering expertise of Saipem with the capabilities in rig equipment assurance as well as the data science of ADC Energy.

There are plans made by the company in order to expand the usage of artificial intelligence along with predictive analytics throughout its wider fleet as part of the digital transformation strategy, which is currently on.

In another effort, Saipem is also executing a predictive maintenance program when it comes to the Saipem 7000, which is one of the largest semi-submersible crane vessels in the world. The project lays emphasis on diesel generators that are critical systems for onboard power and also makes use of IoT sensors along with machine-learning models in order to identify early signs of any kind of malfunction. The system, which is developed with the help of BIP, the international consulting firm, is gearing up for testing in the upcoming months.

According to Saipem, these initiatives indeed highlight its commitment to integrating artificial intelligence – AI, advanced analytics, as well as digital technologies, in order to elevate the safety and efficiency, along with sustainability, when it comes to offshore energy operations.

Being an Italian engineering and construction company, Saipem offers services to both the energy and infrastructure sectors and has quite a robust presence in offshore drilling as well as subsea projects. The company says that its fleet includes semi-submersible rigs and ultra-deepwater drillships, as well as heavy-lift vessels that operate across the world.

• The integration of offshore drilling innovations is fundamentally altering the safety profile of maritime energy extraction by removing human personnel from the high-risk “red zone” of the rig floor. Through the implementation of drilling automation and sophisticated robotic pipe-handling systems, operators can ensure a more consistent and predictable workflow, significantly reducing the likelihood of manual handling accidents and improving the technical precision of complex offshore well construction projects in challenging deepwater environments.
• Leveraging real time drilling data allows for a proactive approach to hazard mitigation, enabling engineers to identify subtle geomechanical shifts or equipment anomalies before they escalate into critical safety incidents. This data-centric paradigm, supported by advanced drilling technology, provides a comprehensive view of the wellbore in real-time, allowing for rapid decision-making and the optimization of drilling parameters to maintain well integrity while ensuring that all operations remain within their designed safe working limits.

The extraction of hydrocarbons from beneath the seafloor has always been a battle against the elements, characterized by extreme pressures, remote locations, and the constant threat of equipment failure. However, the modern era is witnessing a profound shift in this dynamic, as a suite of offshore drilling innovations is being deployed to fundamentally enhance the security of personnel and assets. These innovations represent a departure from traditional reactive safety measures toward a proactive, system-based approach where risk reduction is ingrained in the very architecture of the drilling process. From the use of autonomous robotics on the rig floor to the deployment of sophisticated downhole sensors, the industry is leveraging every tool in the digital and mechanical arsenal to achieve the goal of zero harm.

The primary objective of these technological leaps is to minimize the exposure of human operators to the most hazardous aspects of the drilling cycle. Historically, the rig floor was a site of intense manual labor, where heavy machinery and high-pressure pipes required constant human intervention. Today, offshore drilling safety is being redefined by the widespread adoption of drilling automation, which allows for the remote control of pipe handling, casing running, and bit replacement. This not only improves the speed and consistency of operations but also creates a physical barrier between the workforce and the potential points of mechanical failure. The transition to a “normally unmanned” rig floor is no longer a distant vision but a tangible reality in many of the world’s leading offshore basins.

The Impact of Drilling Automation on Risk Mitigation

The implementation of drilling automation is perhaps the most visible of the offshore drilling innovations currently reshaping the industry. Modern rigs are increasingly equipped with “cyber-chairs” where drillers monitor a series of automated sequences from a safe, climate-controlled environment. These systems use complex algorithms to manage the weight on the bit, the rotation speed, and the mud flow rates, ensuring that the drilling process remains within optimal parameters. By automating these repetitive and high-precision tasks, companies can significantly reduce the risk of human error, which has historically been a contributing factor in many offshore incidents. The result is a more stable drilling environment where the risk of kick detection or wellbore instability is managed with mathematical precision.

Furthermore, automation allows for the synchronization of complex sub-systems that were previously managed independently. For instance, the automated control of the drawworks and the mud pumps can be linked to real time drilling data, allowing the system to react instantly to changes in reservoir pressure. This level of integrated control is vital for maintaining offshore drilling safety during the critical phases of offshore well construction, such as penetrating high-pressure high-temperature (HPHT) zones. As these automated systems continue to evolve, they are becoming more capable of handling unexpected variations in the subsurface environment, further reducing the reliance on manual intervention and enhancing the overall resilience of the drilling operation.

Utilizing Real Time Drilling Data for Enhanced Visibility

Visibility into the wellbore has traditionally been limited by the speed and accuracy of the data transmitted from the drill bit to the surface. Modern drilling technology has overcome these limitations through the use of high-speed telemetry and sophisticated downhole sensors. The continuous stream of real time drilling data provides engineers with a high-resolution view of the subsurface environment, including rock characteristics, fluid pressures, and the physical condition of the drill string. This transparency is a cornerstone of modern offshore drilling innovations, as it allows for the early detection of “pre-cursor” events that could signal an impending safety issue, such as a localized pressure build-up or the onset of vibration-induced fatigue in the drill collar.

The analytical power applied to this data is also increasing. Machine learning models are now used to analyze historical data alongside real-time inputs to predict the remaining life of critical components or to identify patterns that precede a mechanical failure. This move toward predictive maintenance ensures that equipment is replaced or serviced before it poses a threat to offshore drilling safety. Additionally, the ability to share this data in real-time with onshore support centers means that the on-site crew has access to the collective expertise of a global team of specialists. This “collaborative drilling” model ensures that the most difficult decisions are supported by the best available information, further enhancing the safety and technical integrity of the well.

Advancing Offshore Well Construction Standards

The physical infrastructure of the well itself is also benefiting from significant drilling technology advancements. Modern offshore well construction techniques focus on improving the long-term integrity of the wellbore, which is essential for preventing leaks and maintaining operational safety throughout the field’s productive life. Innovations in casing design, such as expandable tubulars and high-performance alloys, allow for more robust well architectures in deepwater environments. Additionally, the development of specialized cement formulations that can withstand extreme pressures and corrosive fluids is improving the quality of the primary seal, which is the most critical barrier against environmental contamination.

Managed Pressure Drilling (MPD) is another key innovation that is gaining widespread adoption. MPD allows for the precise control of the annular pressure profile throughout the wellbore, enabling operators to drill safely through narrow “pressure windows” that were previously considered undrillable. By maintaining a constant bottom-hole pressure, MPD reduces the risk of fluid influx (kicks) and wellbore collapse, both of which are major safety and environmental concerns. The integration of MPD with automated control systems represents the pinnacle of modern offshore drilling innovations, providing a level of safety and operational control that was unimaginable just a decade ago.

The Human Factor in the Age of Innovation

While technology is the driver of change, the success of these offshore drilling innovations ultimately depends on the skills and mindset of the workforce. The shift toward automation and data-driven drilling requires a new set of competencies, focusing more on system management, data analysis, and cross-functional collaboration. Training programs are being redesigned to incorporate high-fidelity simulators, where crews can practice responding to emergency scenarios in a safe, virtual environment. This immersive training ensures that when real-world challenges arise, the team is prepared to act with confidence and technical precision, maintaining the high standards of offshore drilling safety that the industry demands.

Moreover, the culture of safety must evolve alongside the technology. A “just culture” where transparency is valued and where workers feel empowered to halt operations if they perceive a risk is essential for maximizing the benefits of new drilling technology. The human-machine interface must be carefully designed to ensure that the wealth of data provided by real-time systems is presented in a clear and actionable format, preventing cognitive overload and ensuring that the driller remains the final arbiter of safety. By combining the best of human ingenuity with the precision of automated systems, the offshore industry is creating a safer and more sustainable future for global energy extraction.

Conclusion: Shaping a Safer Future for Offshore Drilling

The relentless pursuit of offshore drilling innovations is fundamentally transforming the maritime energy sector, turning what was once a high-risk gamble into a highly controlled and technical enterprise. Through the integration of drilling automation, the use of real time drilling data, and the advancement of offshore well construction techniques, the industry is setting new benchmarks for operational safety and environmental protection. These innovations are not just incremental improvements; they are a vital response to the increasing complexity of modern drilling projects and the growing demands for corporate and environmental accountability.

As the industry continues to push into deeper waters and more challenging geological formations, the focus on safety must remain absolute. The technologies developed today will be the foundation for the energy systems of tomorrow, ensuring that the extraction of vital resources is conducted with the highest possible level of integrity and care. The journey of innovation is never complete, but the progress made in recent years demonstrates that through collaboration, investment, and a steadfast commitment to safety, the offshore drilling industry can overcome even the most daunting challenges, providing a secure energy supply for the world while protecting the people and environments that make it possible.

Of the two offshore contracts in Saudi Arabia, the first contract, which is the CRPO 162, runs for 32 months and goes on to cover the engineering, procurement, construction, and installation -EPCI of almost 34 km of pipeline of 20-inch and 30-inch diameters.

It also goes on to include the related topside works at the Berri and Abu Safah oil fields.

CRPO 165, which is the second contract, happens to have a 12-month term and also involves subsea intervention work at Marjan field, in addition to the EPC of 300 m of onshore pipeline along with the associated tie-ins.

Saipem looks forward to using construction vessels that are already functioning in the region in order to carry out offshore scope.

Fabrication, when it comes to both the projects, is going to be performed at the Saudi yard of Saipem that’s located in Dammam – Saipem Taqa Al-Rushaid Fabricators—and is supporting the objective of the company to expand and also strengthen the local industry capacities.

These awards also go on to further reinforce the long-established relationship of Saipem with Aramco.

In October 2025, Saipem went on to win new offshore drilling deals in addition to contract extensions amounting to almost $135m, or €116.41m, hence in a way strengthening its presence across major areas like West Africa, the Mediterranean, and the Far East.

Santorini, the drill ship, is going to keep operating across Ghana as well as Côte d’Ivoire for Eni Ghana Exploration & Production as well as Eni Côte d’Ivoire.

In September 2025, Saipem was awarded a $1.5bn, or €1.28bn, contract from the Turkish Petroleum Offshore Technology Center – TP-OTC in order to carry out the third phase of the Sakarya gas field development based in Türkiye.

Apparently, situated almost 170 km offshore from Filyos in the Zonguldak province, the Sakarya gas field is majorly regarded as the largest offshore natural gas find in Türkiye.

After the Transocean Equinox, a Transocean semi-submersible drilling rig, which apparently was booked in order to search for more gas offshore Australia, there was a discovery that was made at the Essington-1 exploration well in the VIC/P79 exploration permit in November 2025. The rig spud the Charlemont-1 gas exploration well in the Otway Basin offshore Victoria on December 10, 2025.

The well that went on to intersect prominent gas shows almost 160 meters above the primary target – Waarre A in the Waarre C on December 25, 2025, as per 3D Energi, a ConocoPhillips partner and also a Melbourne-based oil and gas exploration player whose subsidiary, TDO, holds a 20% interest in both permits.

As pressures were thought to be higher at 2,552 meters than expected, drilling activities off Australia coast went on to be temporarily paused in order to assess the potential alterations to the well design, including alternatives to go ahead and continue to drill to the primary target.

The partner claims of the operator that the pre-drill evaluation of the Charlemont-1 prospect did not expect intersecting gas at such a shallower level. Due to this, the activities are at present underway to evaluate the potential adjustments to the well design in order to enable drilling to the primary target, which is the Waarre A.

ConocoPhillips Australia, notably, is the operator, having a 51% stake, with partners like 3D Energi as well as Korea National Oil Company holding the other 20% and 29% interests, respectively.

The approval of the oil & gas drilling project offshore South Africa follows the company’s application last year for drilling exploration or appraisal wells in the Northern Cape Ultra Deep Block within the Orange Basin.

The oil & gas drilling project will occur at 2,500m to 3,200m depth for oil & gas offshore South Africa.

Shell’s authorisation is part of a broader interest among oil companies in the Orange Basin, where significant discoveries have been made in neighbouring Namibia.

Competitors such as TotalEnergies are also considering prospects for drilling in the region, which stretches southwards into South African waters.

Shell highlighted the potential benefits of successful exploration, stating: “Should viable resources be found offshore, this could significantly contribute to South Africa’s energy security and the government’s economic development programmes.”

However, the company has not provided any specific timelines for the drilling operations.

The oil major’s previous exploration along the east coast of South Africa faced set-back due to legal complications over public consultation and environmental issues.

The ongoing litigation, which is slated for a hearing in South Africa’s highest court later this year, may affect the future of oil and gas exploration in the country.

The region has faced challenges in developing its oil and gas potential. The challenges included environmental pressures, legal hurdles, and bureaucratic processes.

The refinery capacity in South Africa has declined over recent years, and it is now highly relying more on refined petroleum products that are imported.

In other news, Libya’s National Oil Corporation has joined forces with BP and Shell to carry out hydrocarbon exploration and development studies in three Libyan oilfields.

The memorandum of understanding (MoU) with BP includes detailed studies in the Messla and Sarir oilfields, among others.

BP also intends to re-open its office in Tripoli by the last quarter of 2025 to manage projects and oversee progress in Libya.