Yesterday morning, the Tui floating production storage and offtake vessel Umuroa finished offloading about 300,000 barrels of the Tui waxy crude into the waiting Akama tanker, which then headed north to drop off pilots at Port Taranaki.
The Akama, which has been chartered long-term and is dedicated to transporting Tui crude, then headed to Caltex refineries in Sydney and Brisbane.
“I’m not saying we’ve especially arranged this for dramatic effect, but we’ve now delivered the first oil offload from Tui and it is aboard the Akama, which is passing by right now,” Australian Worldwide Exploration New Zealand manager Dennis Washer told guests at the New Plymouth function.
The Prime Minister said she appreciated the symbolism and described the completion of Tui – AWE’s first project as operator – in just four years from discovery and 20 months from final investment decision as being “quite phenomenal”.
“We also appreciate the positive effect Tui oil exports will have on New Zealand’s balance of payments,” Clark added.
AWE chairman Bruce McKay said the partners expected the Tui Area – presently New Zealand’s only offshore oil facility – would produce about 10 million barrels, of the almost 28 million barrels of 2P reserves, in the first year of production.
“Such annual oil production levels have not been achieved in New Zealand since 1988,” McKay said.
“At current oil prices, this production may benefit New Zealand’s balance of payments to the tune of $NZ1 billion over the next 12 months.”
Preliminary testing of samples taken from the production wells suggested the properties and quality of crude were in line with pre-production expectations.
Tui’s light, sweet crude has been benchmarked against Tapis.
If AWE and its various joint venture partners find more oil near Tui, these discoveries could be tied-in to the Tui production facilities – possibly extending the project’s life beyond 10 years, McKay said.
Even without further finds, the Tui, Amokura and Pateke oil pools were expected to generate gross revenues of about $NZ3 billion at current oil prices; payment of about $NZ800 million of operating costs; and about $NZ800 million in government tax and royalty payments.
McKay added commissioning the four production wells and subsea systems had been without incident and three of the four wells – Tui-2H and 3H, and Pateke-3H – were online, together estimated to produce in excess of 90,000 barrels per day.
The Amokura well was expected to be available when required to maintain maximum production over the coming months.
A stable crude oil flow rate of up to 42,000bpd had been achieved, though production had been slightly constrained so far during commissioning by the Umuroa, which had a maximum capability of 50,000bpd, McKay said.
But system uptime was improving as experience in operating the new facility was gained.
“Some minor process de-bottlenecking is being implemented, which is expected to allow the full design production rate to be achieved within the next few weeks,” he said.
The second shipment is scheduled to be loaded by the Lion City River tanker from Sunday.
The PMP 38158 (Tui Area) partners are operator AWE with a 42.5% stake, New Zealand Oil & Gas (12.5%), Mitsui E & P New Zealand (35%) and Pan Pacific Petroleum (10%).
