PEP 38460 partner New Zealand Oil & Gas told the ASX and NZSX today that Kiwi-1 spudded on Sunday and was at a depth of 222m at 6am.

A secondary objective, the Cretaceous North Cape Formation would be targeted, in addition to the main Eocene-aged Kapuni F sands. “It is possible that a substantial stratigraphic trap could be present in this deeper zone,” NZOG said.

The Kapuni F sands - in which oil had already been discovered in the nearby Tui, Amokura and Pateke wells - were expected to be encountered at a depth of about 3700m. The North Cape formation was expected to be struck at 4250m.

“There is more to deepening this well than just feeling lucky. We either did not see this play with the previous wells or did not think we would have encountered it. But we better know what’s going on with Kiwi, it’s further down the flank, and so we have decided to test what could prove to be a very large structure,” NZOG exploration manager Eric Matthews told EnergyReview.Net from Sydney.

It was expected the Bounty would take about two weeks to complete drilling the well.

Matthews declined to confirm industry speculation that operator Transworld, through its New Zealand Overseas Petroleum subsidiary, is able to drill so fast because it’s not using intermediate casing.

However, commentators say that is the case. Although not used before in New Zealand waters, this type of drilling has been practiced for almost a decade in some North West Shelf wells. While not suitable for rank wildcats, it offers substantial cost savings for other offshore wells.