MELBOURNE, Australia—BP PLC's proposal to explore for oil off southern Australia has been rejected by the country's offshore petroleum agency, which said the energy company's environmental plan didn't meet regulatory requirements.

In a statement on its website, the National Offshore Petroleum Safety and Environmental Management Authority said it wasn't satisfied with the environmental plan submitted by the U.K. company in early October. The plan doesn't yet meet criteria for acceptance under environment regulations, the agency said.

It comes after the agency late last month delayed an initial decision on BP's proposal to drill four exploration wells in an area known as the Great Australian Bight from next year, in water depths ranging between 1,000 and 2,500 meters (3,280-8,200 feet).

A spokeswoman for BP said Tuesday it was now up to the company to submit a revised version of its environmental plan.

"NOPSEMA is a diligent and thorough regulator and we expect to have to work hard and take the time to demonstrate that we have got our EP right," she said.

The Bight is potentially a vast new oil basin for Australia. BP has said the area has similarities in the geology to some of the world's biggest hydrocarbon regions, such as the Niger Delta and the Mississippi Delta.

However, environment groups have warned of the risks of a deep-sea well blowout in the Bight. The Wilderness Society said a spill would threaten South Australia state's 442 million Australian dollar (US$313 million) fishing industry and A$1 billion in coastal tourism, and would harm waters that are a haven for several species of whales, as well as sea lions and other animals.

Nick Xenophon, an independent senator for South Australia, said NOPSEMA's decision not to approve BP's environmental plan showed there were unacceptable risks in the proposal. He has said he planned to introduce a bill next year that would give the final say on whether deep-sea drilling goes ahead to the federal environment minister rather than to the regulator. Industry body the Australian Petroleum Production & Exploration Association rejected the move, saying the agency should be allowed to work without political interference.

In 2011, BP secured four permits from the federal and state governments to explore for oil and gas in the Bight, which the company said committed it to a A$605 million exploration program including a seismic survey and drilling the wells. Statoil has a 30% stake in the planned operation.

At its closest point, the planned drilling would take place about 395 kilometers west of Port Lincoln and 340 kilometers southwest of Ceduna off South Australia.

Write to Robb M. Stewart at robb.stewart@wsj.com

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(END) Dow Jones Newswires

November 17, 2015 03:45 ET (08:45 GMT)

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