If so, Kahili should prove a very interesting and useful find for Indo-Pacific Pacific (which holds 45% equity in Kahili) and its fellow PEP 38736 partners, Aussie companies Tap Oil (30%) and Claire Energy (25%).
Indo-Pacific chief executive Dave Bennett told EnergyReview.Net from Wellington today that there was presently a wide range of possible and probable reserves estimates. He declined to give figures, though he did say the upper limit would make Kahili about the size of the nearby Ahuroa field, which produced from the Tariki sands formation as did Kahili.
Crown Minerals estimates the original reserves of the combined Tariki and Ahuroa fields to be 3.2 million barrels of condensate, 115 bcf of gas and 300,000 tonnes of LPG. About 25-30% of that can be attributed to the Ahuroa field, which means Kahili could contain about 30-35 bcf of gas and about 1.2-1.4 million barrels of condensate (given Kahili's preliminary flows of 5mmscf/d of gas and 200 bopd of condensate).
Bennett said Indo-Pacific and partners would be working on refining the possible and probable reserves range over the next few weeks.
Results from the Kahili-1B discovery well, which was recently shut in for a pressure buildup, continued to be very good.
No formation water had yet been produced and there was very little evidence of formation damage, which was encouraging considering Swift Energy's declining production from its Rimu-Kauri field that also flowed from the Tariki sands. Kahili permeability was not that high, however. Bennett declined to give precise figures.
Constructing a pipeline tie-in and treating Kahili gas to specification needed to be economic propositions before any development could be considered. However, Bennett reiterated his belief that existing nearby infrastructure gave the partners several development options, particularly with the improving New Zealand gas market and if Kahili proved to be as big as Ahuroa.
The Kahili-1 site was only 4km from a pipeline-tie to Swift Energy's Tawn processing facilities, and 8km from a similar tie-in to Todd Energy's McKee processing facilities; while a potential tie to NGC's raw gas pipeline was a similar distance.
It was also possible electricity generators Genesis Power, Contact Energy, or even Mighty River Power could be interested in purchasing Kahili gas for use in their thermal power stations.
