Equinor has announced its decision to abandon its drilling plan for the Great Australian Bight.
The company said on Tuesday it would discontinue its exploration drilling plan in the Stromlo-1 exploration well, located about 500km west of Kangaroo Island.
A statement said that following a review of its exploration portfolio, Equinor had concluded the project's potential was not commercially competitive compared with the company's other exploration opportunities.
"The approval of the Stromlo-1 exploration well environment plan confirmed our ability to safely operate in the Bight," Equinor's country manager for Australia Jone Stangeland said.
"However, Equinor has decided to discontinue its plans to drill the Stromlo-1 exploration well, as the opportunity is not commercially competitive."
Equinor said it had informed federal, state and local authorities of its decision.
"We will engage with the federal and state authorities regarding our decision to discontinue the exploration program," Mr Stangeland said.
"We hold an exploration permit offshore Western Australia and will maintain other ongoing interests and activities in Australia."
Kangaroo Island resident Linda Irwin-Oak welcomed the decision after years of organising protests against oil drilling in the Bight, together with the Oil Free Seas group.
The Australia Institute has welcomed the announcement and says that the Federal and South Australian governments should now move towards permanent protection and World Heritage listing for the Bight, a move supported by Federal Member for Mayo, Rebekha Sharkie.
"It's time for the State and Federal Governments to step up and give the Great Australian Bight World Heritage protection," said Noah Schultz-Byard, SA Director of The Australia Institute.
"South Australia has been left in limbo, with the threat of drilling in the Great Australian Bight hanging over the state for far too long.
"Establishing the Bight as a World Heritage icon would protect the economic, cultural and environmental interests of South Australia.
"Permanently protecting the Great Australian Bight with World Heritage listing would give South Australia the economic and tourism boost it so needs.
"With three global oil giants abandoning their plans to drill in the Bight, the time for the government to give the South Australian community certainty and permanent protection for the Great Australians Bight has come."
Minister for Resources, Water and Northern Australia, Keith Pitt says the decision by Norwegian-based energy company Equinor to discontinue its oil exploration program in the Great Australian Bight, offshore from South Australia, was disappointing but the company is not leaving Australia.
"Equinor has made it clear this was a commercial decision and the company will continue to be part of the Australian oil and gas industry," Minister Pitt said.
"I know many will find Equinor's decision not to proceed with this oil exploration project in the Great Australian Bight extremely disappointing, and it is particularly hard for South Australia.
"The Liberals and Nationals Government remains committed to encouraging the safe development of Australia's offshore petroleum resources, which is overseen by a world-class independent regulator in the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA).
"The Bight Basin remains one of Australia's frontier basins and any proposals for new oil and gas fields in this area will be assessed fairly and independently."
"I want to highlight that Equinor worked within the rigorous approval processes in place for this project and the company's environmental plan had been accepted by NOPSEMA.
"Since Equinor was first granted the exploration permit in 2011, the company has undertaken a rigorous and very public process of consultation and approvals process."
Equinor continues to have an interest in oil and gas exploration in Australia, including an exploration permit offshore Western Australia.