The announcement is confirmation of what EnergyReview.Net predicted last week - that Taranaki is looking to its second consecutive busy offshore summer, with a semi-submersible rig due for another multi-well, multiple operator program.
NZOG today said it had signed a heads of agreement with a "major international company" to meet a substantial portion of NZOG's costs of drilling two to three wells, and any initial field development costs within PEP38460. In return, NZOG would assign this mystery player - rumoured to be OMV or perhaps Santos - a 7.5% interest in the permit, while it retained a 12.5% stake.
The proposed program is for two firm exploration wells, Amokura and Pukeko, with a third dependent on results from the first two wildcats. If any development is subsequently approved, initial development costs will be approximately US$9.5m (NZ$16m), with NZOG meeting 5% of those costs in respect of its retained 12.5% interest.
"This is a very good result for NZOG and the terms of the deal demonstrates the importance of the February 2003 Tui oil discovery in the Kapuni 'F' Sands," said NZOG chairman and chief executive Tony Radford.
"The envisaged program will allow rapid evaluation and decisions for early development if the exploration drilling is successful. The permit area is seen as very attractive given the proven presence of oil in extremely good reservoir sands."
Radford said oil flows of 5000-10,000 barrels per day from individual wells were anticipated.
NZOG company secretary Brian Roulston said everybody would be interested in learning the identity of the new partner, who had requested anonymity until the final contracts were signed. "This is a major company, not an Australian firm, but one which I think has farmed into some Australian interests recently. Everybody will recognise the name," he told ERN from Auckland today.
Since the Tui oil discovery, the PEP38460 partners have done a 3D seismic survey which exploration manager Eric Matthews said had confirmed a structural closure over Tui, with potential recoverable oil of 10-15 million barrels. In addition to Tui, several other prospects, with potential to each hold 10-40 million barrels of recoverable oil, were delineated.
"Identification of further oil pools within the permit area will be an important factor in any decision by the joint venture parties to commence production", he added.
Amokura, about 4km northwest of the Tui-1 well, would be the first well, to test a Kapuni F sands closure similar in style to Tui. Amokura-1 would also help understanding of the seismic imaging which could increase the potential of Amokura from 15 million to more than 35 million barrels of oil.
"The discovery of oil at Tui points to a source of oil further west in the Kahurangi Trough and upgrades prospects in the southern area of permit, Pukeko, Hector and Tahuroa.
"Of these Pukeko has been selected by the joint venture for drilling following Amokura because it is a large prospect at both the Kapuni F and C sands and lies close to the postulated source of oil. In excess of 80 million barrels potentially recoverable oil is identified in the Kapuni C sands, with potential for additional oil in the deeper Kapuni F sands level," said Matthews.
As Pukeko was some 70km south of Tui, any commercial discovery would require a separate development.
