It is impossible to write anything about the offshore sector that does not take into account the dramatic fall in the oil price. Whether discussing new technologies, economics, exploration, development and maintenance operations, the price plunge—and the geopolitics of oil—has put a damper on everything.

As usual, this is the point at which those with experience recall similar downturns, along with the reassuring fact that things eventually improve again. The big question is when—and what to focus on in the meantime?

Australia’s offshore sector, like all others, is facing a downturn expected to last into 2016. With all eyes on the economic performance of major flagship projects such as Shell’s 5.3mt/a Prelude development to prove that FLNG is viable on a large scale, the reality is that it won’t start operations until 2017.

Other high-profile, high-cost projects such as Woodside’s 11.7mt/a Browse FLNG development also destined for offshore Western Australia have had their engineering phases “extended” (don’t mention the ‘D’ word!) to focus further on reducing costs and risks. A Final Investment Decision (FID) on Browse is not likely until mid-2016. Woodside, like everyone else, is of course hoping that the oil price will be heading upwards by then.

But already there are clear examples of where opportunity lies for those nimble enough to move quickly.

Cooper Energy snapped up a 50 per cent stake mid-December in the Sole gas field offshore Gippsland in the eastern Bass Strait, plus 50 per cent of the onshore plant in Victoria from Santos, which retains the operatorship and 50 per cent of the field and plant.

This $27.5 million deal comprised cash of $2.5 million to be followed by Cooper funding 100 per cent of the first $50 million of the development costs—a great solution for both Santos, which avoids any Capex, and Cooper, which gains access to a low-risk upcoming development in a mature producing province with upside. Cooper estimates the detailed FEED for Sole will cost $25 million to $29 million.

This opportunity comes from a field discovered by Shell back in 1972, about 65km from the processing plant. Shell intersected 16m of net gas pay on the flank of the field, but did not continue as it was deemed non-commercial. A Sole-2 appraisal was drilled by Santos in 2002 near the crest of the structure and hit 68m of net gas pay.

With the FEED about to begin, the field (if it receives its planned FID in Q3 2016) is due onstream in late 2018 or early 2019, with gas to be piped to the plant originally used for production from Santos’ Patricia and Baleen fields.

This project is beautiful in its simplicity. It’s a standard single vertical subsea well expected to produce more than 70 MMcf/d from a conventional gas reservoir, piped direct to the plant, currently processing gas from the Longtom field. Some modifications will be needed to handle Sole’s gas, which contains 1 per cent CO2, 0.15 per cent H2S and less than 1 bbl condensate/MMcf, but that is it. It makes use of existing infrastructure, and is in close proximity to the Eastern Gas Pipeline, linking it to the Victoria and New South Wales markets.

With Cooper Energy also operating the Basker-Manta-Gummy complex 35km southwest of Sole, where it is studying a redevelopment of gas reserves there, further opportunities await.

Managing Director David Maxwell pointed out that the deal would more than double its Gippsland gas resources and give it a 50 per cent stake in a project being prepared for FID and a gas hub that will assume growing significance in the eastern Australian market (where prices are rising). It would also open up “new possibilities” for commercialisation and development of other resources in the Gippsland region, he said.

When times are tough and the oil price is rendering many larger-scale developments non-feasible, smaller projects are the lifeblood that keeps offshore sectors alive until the next upcycle. While they may be relatively small, they are reliably competitive in all but the worst-case scenarios. And the industry is a long way off from that.