Crown Minerals recently declined Canadian-listed junior TAG Oil’s application to renew PEP 38745, Todd Energy’s application to renew PEP 38749 and Greymouth Petroleum’s application for a renewal of PEP 38747l.
Past efforts in PEP 38745 include the unsuccessful Hursthouse-1 and Richmond-1 wells, while Todd Energy drilled the non-commercial Te Kiri-2 well in PEP 38749 in late 2006, and Greymouth drilled the unsuccessful Korito-1 well in PEP 387471 in 2005.
However, the Ministry of Economic Development unit has recently approved Austral Pacific Energy’s applications to renew licences PEP 38746 and 38748, and TAG’s request to renew licence PEP 38758.
Past exploration efforts in those permits include the Heaphy-1 (PEP 38746) and Kakariki-1 (PEP 38748) wells for Austral, and the Mangamingi-1 well in PEP 38758 that flowed non-commercial rates of gas for TAG earlier this year.
Todd Energy managing director Richard Tweedie said these results showed the process to renew licences seemed to be decided “by chance”.
“It’s unfair that explorers, who have not sat on acreage but invested tens of millions of dollars shooting seismic and drilling wells, have their reasonable request for extensions declined, while others have theirs approved,” Tweedie told PetroleumNews.net .
“Such inconsistencies send yet another message to explorers that they might get mucked around in the New Zealand E&P sector.
“This is in addition to the Government banning new baseload gas-fired power stations for the next 10 years and the likely imposition of carbon charges on petroleum producers from 2010.”
Austral, which had been a partner with operator TAG in PEP 38745, also expressed some concerns.
“Our industry is naturally fraught with risk and uncertainty,” Austral president Thom Jewell said. “We need to have a regulator that will work with us to maintain the continuity of the E&P business.”
Crown Minerals petroleum investment manager Mark Aliprantis said the Ministry of Economic Development unit did not discuss its decisions for approving or declining individual permit applications.
“Every application is carefully assessed on its own merits in accordance with the Crown Minerals Act 1991 and Minerals Programme for Petroleum 2005,” he said.
“We recognise that unfavourable decisions have the potential to create a level of disappointment with applicants, which is understandable.”
Crown Minerals was also considering a renewal application by Swift Energy for PEP 38742, where it had drilled the shallow Karaka-A1 and deep Kowhai-A1 wells together with ammonia urea plant owner Ballance Agri-Nutrients, Aliprantis said.
