The listed company told the Australian Stock Exchange on Friday: “MEC was reviewing new data from an airborne survey conducted east of Newcastle which detected evidence of petroleum seeps on the sea surface.”
Responding to the newspaper report, Greens MP Lee Rhiannon said companies exploring for oil off the NSW coast could face lawsuits because of mounting evidence that such operations harm whales, and the potential for an oil spill could wreak untold harm on the tourism and fishing industries.
“There is no guaranteed benefit for the people of NSW from coastal oil and gas exploration and there is a real chance such activities would cause harm and stress to migrating whales,” Ms Rhiannon said in a statement.
“If seismic testing is used to explore for oil, the shock waves could distress whales migrating along Australia’s east coast.”
She noted indigenous people in Alaska and conservation groups filed a lawsuit last month against Shell Oil and British Petroleum to stop exploration planned for the seas above the Arctic Circle where bowhead whales migrate.
“This problem and the associated potential for oil spills demonstrate that proposed oil exploration off the NSW coast should be scrapped before it starts,” Ms Rhiannon said.
Furthermore, the exploration off the NSW coast would not reduce petrol prices or secure oil supplies as “offshore oil fields take at least five years to develop so such reserves would have minimal impact on the peak oil phenomenon”.
The MEC report estimates undersea reserves of up to 1 billion barrels of oil and enough gas to meet Sydney’s needs for a decade. It is seeking shareholder approval to restructure its oil and gas assets to improve access to capital for exploration.
A joint contract led by MEC and Bounty Oil is expected to be executed this year and the project has applied for an extension of a licence to explore the site while awaiting the arrival of the drilling rig to Australia, which is expected by May next year, the newspaper reports.
A spokesman for NSW Premier Morris Iemma confirmed to the newspaper the application had been received, and MEC has told shareholders it expects approval to be granted.
Drilling in NSW will send petrol prices down: Opposition
If the venture is successful the public will benefit from a drop in petrol prices, NSW Opposition Leader Barry O’Farrell said.
The promise of oil would be welcomed by the public, Mr O’Farrell said.
“The beneficiaries are the public,” he told reporters in Sydney.
“As is evident by the increasing price of oil, we’re reliant on international oil cartels and the prices are currently only going in one direction.
“If we’re talking about oil rigs 20 kilometres off the coast, if that offers the hope of increased oil [and] reduced petrol prices, I think the community will welcome it.
“We see both State and Federal governments talking long and hard about working families but doing nothing practically to assist the cost increases they’re facing.”
Mr O’Farrell said that the environmental impact would be minimised by safeguards such as those in place for other mining projects.