BP Plc expects to start drilling an untapped oil frontier off the coast of southern Australia later than it had estimated, citing the potential for a delay in the delivery of the rig.
The U.K. energy giant plans to begin drilling in late 2016, compared with its initial target of early next year, BP’s Australian unit said Thursday in an e-mailed response to questions.
“We have anticipated some slippage in timelines,” according to the statement. “It is in BP’s best interest to commence drilling in late 2016 rather than risk creeping delays and premature expenditure.”
BP, Chevron Corp., Statoil ASA and Santos Ltd. are among energy companies expected to invest more than A$2 billion ($1.6 billion) on exploration in the Great Australian Bight.
Diamond Offshore Drilling Inc. in 2013 announced an agreement with Hyundai Heavy Industries Co. to build a new rig at an estimated cost of $755 million. The contractor also signed a three-year drilling contract with BP to use the rig in operations off South Australia.
BP has said it expects to cut spending and may defer some projects such as Mad Dog in the U.S. Gulf of Mexico amid a slump in oil prices.