PERTH, Australia, Nov 3 (Reuters) - U.S. independent

ConocoPhillips ( COP ) began drilling its first exploration well

as part of larger campaign searching for natural gas offshore

eastern Australia, 3D Energi, its junior partner in the

project, said on Monday.

Work began over the weekend on the Essington-1 well, which

will take 32 days to drill down to 2,650 metres (8,694 feet), 3D

Energi said in a filing to the ASX.

The well is the first in the Otway Exploration Drilling

Program to develop new gas for Australia's eastern domestic

market, the company said.

Eastern and southern Australia are facing supply shortfalls

before the end of the decade, causing tension between gas

exporters and domestic manufacturers.

The campaign represents one of the first major offshore

exploration campaigns in East Coast waters in almost seven years

as the old fields in the Bass Strait offshore the state of

Victoria run dry.

Under the Otway program, Conoco will drill two wells this

year, out of a total of six planned, and an option for four

additional wells if needed.

The tight domestic eastern gas market has been a source of

political tension for many years.

An "Australian Domestic Gas Mechanism" trigger was

introduced in late 2017, limiting the export of spot cargoes

when gas was tight from the three liquefied natural gas

consortia in Queensland fed by the state's onshore coal seam gas

fields, with backup from Victorian gas supplies. ConocoPhillips ( COP )

is operator of one, Australia Pacific LNG.

The current Labor government has considered expanding export

controls since its first term in 2022. Japan has argued against

controls as it is Australia's largest LNG buyer.