“Cardiff has the potential to be a very significant gas producer and, if it proves to be the commercial success we believe it will be, significant capital expenditure by the partners will be required to realise its production potential," Newman told an informal shareholders' meeting in Wellington yesterday.
Chief executive David Bennett said the Cardiff prospect in licence PEP 38738 could contain as much as NZ$5 billion worth of gas over 25 years if it was proven commercially viable and reserves were at the top end of expectations.
Earlier this year, Canadian independent consultants Sproule International estimated “probabilistic” gas in place exceeding 215 bcf (50%) and 341 bcf (10%), plus 12.8 million (50%) and 21.5 million barrels (10%) of condensate for Cardiff.
Bennett said the Sproule mid-range estimate would mean Cardiff contained about NZ$1 billion worth of gas and condensate.
The upper end of Austral's own estimates of the gas in Cardiff reservoir, which were in line with Shell's 1999 estimates, was that Cardiff could contain perhaps four times as much gas – about 1tcf.
Cardiff would have to flow at least 2 million cubic feet a day of gas to be commercially viable but could flow as much as 20 million cf/d.
Earlier this week, Austral said it had successfully perforated the third and top test zone at Cardiff-2A and was preparing to fracc that zone in preparation for production testing of all zones within the Eocene-aged Kapuni Group from next month.
The PEP 38738 deep partners are: operator Austral (25.1%), Cheal Petroleum (15.1%), International Resource Management (19.8%) and Genesis Energy (40%). The PEP 38738 shallow partners are: operator Austral (36.5%), Cheal Petroleum (30.5%) and IRM (33%).
