In a quarterly report released yesterday, the Wellington-headquartered company said total Tui oil production – from first oil on July 31 to the end of December– was almost 6.4 million barrels, with NZOG’s 12.5% share amounting to 800,000 barrels.
NZOG’s operating revenue for the five-month period was $NZ84.2 million ($A74 million), with Tui providing $NZ61.5 million ($A54 million) of that total.
Tui contributed only $NZ10 million ($A8.79 million) during the September quarter, but $NZ51.5 million ($A45 million) in the next three months as production ramped up to just under the 50,000bbl per day design capacity of the floating processing storage and offtake vessel, Umuroa.
NZOG spent about $NZ4.3 million ($A3.8 million) on exploration in the six months to December, about $NZ46.5 million ($A40.9 million) on development, and production costs were about $NZ7.2 million ($A6.3 million).
Chief executive David Salisbury said water cut at Tui was still less than expected – operator Australian Worldwide Exploration yesterday said that was about 22,800bpd, or 32%.
This meant production volumes have been much better than expected, with all partners increasingly confident about the continued performance of the Tui, Amokura and Pateke oil pools.
NZOG also said the entire Tui mining licence PMP 38158 was being remapped, which was expected to better define leads, such as Oi and Kahu, for possible upgrading to drillable status in preparation for a 2009 drilling campaign.
Any further commercial discoveries could be tied in to the Umuroa production facilities.
Meanwhile, NZOG’s other offshore Taranaki project, the Kupe gas-condensate development, continues to face cost and schedule pressures, although first flows to shore are still expected from about mid-2009.
Well over half the revenues from Kupe were expected to come from estimated recoverable liquids reserves – of 1.1 million tonnes of liquefied petroleum gas and 14.7MMbbl of condensate.
NZOG said project economics had improved because of higher forecast liquids prices.
NZOG also said that after the jack-up Ensco Rig 107 had finished drilling the three development wells in the central field area of the Kupe mining licence (PMP 38146), it would drill two exploration wells for the Kupe joint venture.
The first will be the Momoho-1 well and then a sidetrack to test the west and east compartments of the Momoho prospect, which are separated by a fault.
Commercial success here would enable rapid development via a tie-in with existing production facilities.
Elsewhere in Taranaki, the Tui partners have already identified numerous leads in licence PEP 38499, which is south of Tui and west of Maui.
A 2D seismic program shot in mid-2007 over these leads, including Toke, Mataku and Kakapo, was aimed at producing some drillable prospects for a 2009 drilling campaign.
NZOG said success here could lead to another Tui-style development, involving subsea completions and a FPSO.
The Tui partners are operator AWE (42.5%), Mitsui E&P NZ (35%), NZOG (12.5%) and Pan Pacific Petroleum (10%).
The Kupe partners are operator Origin (50%), Genesis Energy (31%), New Zealand Oil & Gas (15%), and Mitsui E&P NZ (4%).
