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The Arafura Sea is a continental-shelf sea located between Irian Jaya (western New Guinea) and the northern part of the Australian continent. On the south it adjoins the stable Australian craton, and on the north it is bordered by the Tertiary collision zone between the Australian craton and the northern Irian Jaya island arc. On the west and northwest it is bounded by the active Banda arc collision zone, whereas on the east it is bordered by the northern extension of the Gulf of Carpentaria that also forms the western limit of the zone of late Paleozoic granites. Shelf sediments, ranging in age from late Paleozoic to Cenozoic, predominate in the Arafura Sea continental shelf, and are underlain by granitic basement. Two tectonic styles of deformation are recognizable in t e area, namely a block-faulted downwarping within stratified shelf and slope sediments of the Arafura Sea and overthrusting of chaotic sediments from the Banda arc toward the Australian continent in which the intensity of deformation increases from south to north. Gas shows have been reported from Jurassic to Cretaceous fine-grained marine limestones and sandstones, and gas and condensate also are present in Cretaceous sediments and Middle Jurassic fine-grained sandstones.
At the north, the most prospective area seems to be the hinge zone of the Aru high, where a combination of traps and reservoir rocks presumably exists. On the south, the Money Shoal area is considered a significant prospect. In the Arafura basin, stratigraphic traps seem to be the most promising target for hydrocarbon exploration as tectonics seems not to have played an important role in the area. The sedimentary area occupied by the eastern extension of the Tarera-Aiduna wrench fault should also be investigated in detail for its hydrocarbon potential.
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