Santos said it made a natural gas discovery in the Basset West-1 exploration well in the shallow waters of the coast of Western Australia. The company said preliminary testing confirmed the presence of a natural gas layer measuring 25 feet thick. The discovery was made near other natural gas reserve areas.
Santos Exploration Director Bill Ovenden said the company was working to get a better understanding of the Basset exploration well.
"Further work is required to fully understand the overall resource picture for the Bassett feature," he said in a Friday statement.
Chinese, Japanese and other Asian consumers have expressed interest in Australian natural reserves to feed their energy-hungry economies.
Australia is among the top exporters of liquefied natural gas in the world. The U.S. Energy Department's Energy Information Administration reports Australia had 110 trillion cubic feet of proven natural gas reserves as of 2011.