Asked whether Karoon is evaluating opportunities here at home, such as off the Western Australian coast where it once held exploratory drilling leases, Fowles is less-enthusiastic: “I don’t think in the short term we will be looking to reinvest in Australia,” he says.

For an oil and gas executive, it’s not hard to see why. The time it takes to secure approvals in Australia for new offshore developments has blown out astronomically, he explains, measured no longer in months, but in years.

Fowles points to Santos’ $5.8 billion Barossa project and Woodside’s $16.5 billion Scarborough venture off WA, both of which have been mired in delays and uncertainty after environmental lawyers and some traditional owners succeeded in gaining court orders to suspend works.

A shock ruling in 2022, which found Santos had not adequately consulted traditional owners before submitting plans to the regulator, threw the entire sector into turmoil as companies were forced to withdraw applications and launch new rounds of talks with affected communities.

Industry leaders decried the system as “broken” and vulnerable to exploitation by activists intent on halting new fossil fuel supplies, particularly after the Federal Court this year ultimately cleared the way for Santos to restart works, finding some evidence from the Environmental Defenders Office had involved “confection” and the subtle coaching of Indigenous witnesses.

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Others, however, see the slowdown following years of uninterrupted growth of the emissions-intensive industry as a positive, maintaining that oil and gas developments by their very nature come with grave environmental, cultural and economic risks, including for First Nations communities, meaning robust consultation requirements are vital. The Australasian Centre for Corporate Responsibility, an activist shareholder group, describes the wave of outcry from sector leaders as a “distraction from company failings”, and warns lobbying for regulatory reform poses a threat to First Nations’ rights.

As debate continues to flare and hold-ups remain, the uncertainty persisting across the sector in Australia presents risks that cannot be ignored by companies like Karoon mulling where to spend their money next. In Brazil, says Fowles, Karoon can typically secure approvals in six to nine months.

“If someone said to me, ‘Where do you see more sovereign risk, Brazil or Australia, at the moment?’ Well, Australia has not been doing itself any favours,” he says.

“We continue to look in Australia of course, it’s our backyard, but we will need to see now a rebuilding of confidence in Australia first.”

Both in Australia and around the world, activist efforts to impede fossil fuel projects has been rising amid intensifying warnings about the need to slash greenhouse gas emissions that are dangerously heating the planet.

Questions are also arising from a growing number of institutional investors concerned about long-term climate risk and an uncertain demand outlook for new fields in a rapidly evolving world. Last year, the International Energy Agency predicted for the first time that oil demand is likely to reach its peak later this decade as electric cars continue to rise in popularity and China’s economy slows.

Fowles, who supports greater electric vehicle uptake, predicts that demand for the type of crude oil Karoon produces will remain strong into the 2030s. He adds that electric cars are unlikely to be “make or break” for the oil industry, as much demand also comes from applications such as plastics and chemicals that are essential to everyday life.

“In today’s world, there’s almost nothing that hasn’t touched oil and gas in one way or another,” he says. “To try and remove all of that by 2050, I struggle to get my head around it.”

For now, Karoon’s considerable cash generation potential is catching the attention of analysts. Assuming a $US60 oil price in 2025, Citi analyst James Byrne calculates that Karoon has the potential to generate 40 per cent of its market value in free cash flow in the next 24 months.

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