Vice-president Ed Berg said Thomasson was considering reprocessing the seismic data Shell NZ had shot last September and that the Colorado company would not relinquish the permit it was awarded in July 2000.

“Reprocessing of Shell's seismic data would attempt to detect the presence of hydrocarbons in the shallow section. Shell's reason for exiting the project was the lack of seismic indication of deep source rock section,” said Mr Berg from Denver earlier this week.

“We agree that the source rocks are a risk, but will not relinquish the permit until further tests more strongly indicate the absence of hydrocarbon charge.

“Shell was primarily interested in the large structures under the Oligocene shales.

“Thomasson originally thought there was good potential in the Miocene turbidite sands, but the new data shows these deposits were more likely to be channel-lag sand and gravel. These would make good reservoirs, but identifying trap extents would be more difficult than turbidite accumulations,” Mr Berg added.

The reprocessing would only take a month and Mr Berg said Thomasson was also looking for another party to farm in to the permit so it could commit to a drilling programme next year.

Earlier in April Shell NZ chairman Lloyd Taylor commented that Shell was not convinced of the likely presence of Cretaceous grabens with source rock potential within the 11,000 square kilometre permit. “Without oil sources you have no plays,” he said this week.

Shell paid the Multiwave Geophysical Company of Norway to acquire the reconnaissance seismic, in the largely unexplored region to the north of and offshore from Haast, using the Polar Duke survey vessel last September.

Thomasson approached Shell NZ last July after interpreting existing data and regional geology showed the area could be prospective for oil and gas as the region had geological similarities to the Taranaki and Australian Gippsland Basins, albeit on a smaller scale.