Exploration drilling in Australia in 1987 increased after a slow start following the downturn in 1986. The greatest increase occurred in onshore drilling in the Eromanga, Cooper, Surat, Canning, and Otway basins; offshore drilling actually decreased. Despite the lower drilling effort offshore, the most significant discoveries and extension tests occurred offshore in the Gippsland basin and along the North West Shelf. These were the discovery of an oil leg in a step-out well in the Kipper gas field and 2 new-pool oil discoveries in Flounder field, plus 2 other discoveries in the Gippsland basin. Extension tests in Saladin and Challis fields at opposite ends of the North West Shelf were successful.

Whereas some spread in distribution of oil and gas discoveries occurred in the Eromanga, Cooper, and Surat basins, all the discoveries appear to be small accumulations. Both a minor oil discovery and a minor gas discovery were made in the Otway basin in what has been one of the more successful years in the exploration history of this basin. Geophysical activity decreased in all states.

With a full year's production from the Harriet and Saladin oil fields on the North West Shelf, Western Australia production again exceeded that of Queensland. Four-fifths of Australia's liquids production came from the Gippsland basin in 1987. The 4 other oil producing states--Western Australia, Queensland, Northern Territory, and South Australia--shared the remaining 20% almost equally. Average daily production of crude oil and condensate increased to 544,000 b/d from 515,000 b/d in 1986, but was still short of the 1985 figure of 565,000 b/d.