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BHP and ExxonMobil are holding on to their ageing oil platforms in Bass Strait, off the Victorian coast, just 20 months after putting them on the market.
The fields that make up the oil block include Australia's oldest and largest oil field, Kingfish A and B.
The 50:50 Gippsland Basin Joint Venture has also abandoned attempts to sell the Perch, Dolphin, Seahorse, Tawhine, Fortescue, West Kingfish, Halibut, Cobia, Mackerel, Blackback and Flounder fields.
The offshore oil fields have been in decline, and it is expected the companies will consider ramping up investment to boost production.
Current production from the platforms is about 19,000 barrels of oil equivalent a day.
An ExxonMobil spokesman confirmed the company's decision to keep the fields.
"After consideration of a range of options, we have currently decided to retain ownership and operation of these assets," he said.
"We are committed to our Australian operations and ensuring the safe and reliable delivery of oil and gas to our customers."
Energy analysts said the turnaround represented a significant shift in focus.
"The announcement is quite significant because Esso and BHP were planning to sell out of some of their older oil producing assets in Bass Strait," EnergyQuest chief executive Graeme Bethune said.
"But the fact they're not wanting to do that now probably reflects in particular the strength of the oil price."
Oil prices have jumped from $44 per barrel in June 2017 to $64 per barrel today.
"The companies are also working hard to reinvest in their gas assets in Bass Strait, so it really does show a turnaround from where we were a couple of years ago," Dr Bethune said.
A spokesman for BHP confirmed the decision not to progress with the sale, and said the sale had been pursued in line with BHP's strategy to divest non-core late-life assets.
Topics: business-economics-and-finance, oil-and-gas, sale-3850
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