Australia's most gas-dependent state can be well supplied for decades without drilling near Scott Reef or fracking the Kimberley, according to an exclusive analysis by Boiling Cold.
In 2021 Premier Roger Cook exempted US-owned Black Mountain Energy from WA’s ban on exporting onshore gas, meaning its troubled Project Valhalla will be little help to local industry.
A spokesman for the Premier said that if it proceeds, Valhalla “would be allowed to export a portion of its production under Western Australia’s domestic gas reservation policy as the 'first mover' in the Canning Basin.”
The government neglected to specify the extent of the “portion.” It is 87 per cent.
Black Mountain will be treated the same as offshore production in Commonwealth waters, and have to supply 15 units of gas to the WA market for every 100 units exported (% of total production for local use = 15 / (100+15) = 13 per cent ).
The action of Cook as state development minister in 2021 is not the only hurdle stopping Black Mountain filling what the Premier called a “Browse-sized hole in our energy supplies in the early 2030s.“
Black Mountain’s initial drilling of 20 appraisal wells in the Kimberley will be done over seven years to determine if the underground formation can deliver sufficient gas for a larger project to be economically viable, according to Department of Climate Change, Energy, the Environment and Water meeting minutes released in May after a freedom of information request.
If the Federal Government follows WA and approves Valhalla this year, Black Mountain would not know if a production scale project was viable until 2033.
If the investment made sense, then the design, approval and construction of a pipeline to the Pilbara and the drilling of hundreds of wells to fill it with gas would take many years.
It would be almost 2040 until the 13 per cent of production dribbled into the WA market. That is way too little and too late for Cook’s early 2030s gas shortage.
There is also the difficulty of Black Mountain Energy, that had just $302,000 in the bank at the end of 2025, affording the initial appraisal drilling.
Its US parent Black Mountain Oil and Gas is already trying to build a $US10 billion ($14 billion) data centre in Fort Worth, Texas, so may not want to divert resources to an investment that will take more than a decade to get first revenue.
Any other options?
The Premier’s spokesman said any future proposals in the Canning Basin would be treated the same as other onshore gas developments and be required to sell 100 per cent of volumes to the domestic market.
However, after Black Mountain, there is little prospect of other companies holding acreage in the Kimberley supplying the rest of the state with gas.
Buru Energy is developing its Rafael project, which does not need fracking to produce gas. If it goes ahead, the ASX-listed company plans to supply only the Kimberley, using trucks to deliver liquefied natural gas to the region's power stations.
Rey Resources ceased to be an ASX-listed company in 2025 when it was taken over by private company Vigourous Resources whose majority owner was owed $22 million by Rey.
In 2022 private company Theia Energy withdrew a proposal for fracking that was with the WA Environmental Protection Authority.
I worked in oil & gas in commercial and engineering roles for 20 years. Since 2016, I have written for The West Australian, WAtoday, The Guardian and Boiling Cold, winning five WA Media Awards.
Australia's most gas-dependent state can be well supplied for decades without drilling near Scott Reef or fracking the Kimberley, according to an exclusive analysis by Boiling Cold.
As Asia scrambles for gas, another Australian gas export plant is out of action, and the WA Government monitors the situation to ensure sufficient fuel for the state.
Peter Milne
