PERTH, Nov 17 (Reuters) - Oil giant ConocoPhillips ( COP )

said on Monday it had struck gas off the coast of

southeastern Australia after beginning its maiden exploration

drilling on November 1.

Wireline logs indicated gas columns across two targets off the

coast of Victoria state. Work is set to continue for two more

weeks before moving to a second exploration well, designed to

prove the existence of a large gas resource that could supply

Australia's east coast market.

The company's country president, Jan-Arne Johansen, called the

discovery encouraging and said it was the first in the region in

four years.

"We look forward to continuing drilling our second exploration

well in December," he said in a statement.

The U.S. company shares the Otway Basin permit with

Australian junior 3D Energi and Korea National Oil

Company, which joined the venture in May. Conoco first joined 3D

in 2019, around the time it was divesting its interest in the

Darwin LNG project and associated offshore gas fields.

Conoco said operations at Essington-1 are ongoing and once

it is plugged and abandoned it will move to the second well of

the exploration campaign. Six wells are planned across two

permits, with an option for four more.

The partners hope to discover a commercial-sized source of new

supply for Australia's east coast, where material shortages are

forecast in the late 2020s. It also operates Australia Pacific

LNG in Queensland which has been threatened with export controls

by Canberra if domestic needs are not met. Shares in 3D rose

almost 35% by midsession to A$0.16 ($0.10).