NZOG subsidiary Petroleum Resources Limited will share this permit 50/50 with co-venturer Origin Energy Resources (NZ) Limited.

"Within the new permit, the Mangatoa prospect is the primary target. Here the Cretaceous sequence is truncated by the overthrust along the Taranaki Fault," NZOG said.

" Te Ranga-1, which was drilled in 1986 encountered these sands, which, while of only modest reservoir quality, have indications of gas charge.

"The seismic and drilling activity in our block to the south have helped to delineate the previously undefined southern portion of Mangatoa.

"The first phase of work in the new permit is to reprocess the existing seismic data and to update delineation of the structure using data from Opito."