Australian Worldwide Exploration told the ASX this morning that it was using a series of transactions to increase its involvement in exploring the prospective oil trend in the western Taranaki Basin.
Firstly, the PEP 38460 (Tui) joint venture was relinquishing the Hector area in the southern portion of the block, while the PEP 38483 joint venture was acquiring the same area as an extension of that permit.
AWE was also farming out a portion of its equity in the enlarged PEP 38483 to alliance partner Mitsui, for a partial financial carry through a major 3D seismic survey over the Hector trend scheduled to start next month. AWE would continue as PEP 38483 operator.
Also, AWE was managing a 72 square kilometre 3D extension to the already acquired Tui 3D survey on behalf of operator NZ Overseas Petroleum (a Transworld Oil subsidiary).
The purpose of the Tui 3D extension was to fully define the extent of the Pateke oil discovery made last year by the Pateke-2 well. This survey was expected to be acquired late this month.
This work would be conducted in parallel with the Tui area FEED work announced recently.
Immediately after the first survey, AWE and the PEP 38483 joint venture participants would also acquire 414 square kilometres of 3D seismic over the Hector area.
Seismic data processing and its subsequent interpretation would take several months before prospects could be high-graded for drilling, but this work would be fast-tracked with a view to drilling later this year or early next.
AWE said the Hector area was considered to be highly prospective due to a combination of the favourable reservoir development within the Eocene-aged Kapuni F sands (the same oil-bearing interval as in the Tui area and Maui B oilfields) and the prime location for oil charge from the adjacent Kahurangi Trough.
Several F sand leads had already been identified on existing 2D seismic and these were the primary objective of the 3D survey. There was also a large stratigraphic trap within the Kapuni C sands which was partly coincident with the deeper F sand closures, according to AWE managing director Bruce Phillips.
“Since AWE’s IPO over seven years ago we have been positioning the company to gain greater participation in the most exciting exploration plays in New Zealand," Phillips said.
"This transaction is a positive step in that direction. The recent announcement about progress on the Tui area oil field developments has enhanced our view on the commercial attractiveness of exploration and development opportunities in New Zealand.”
Meanwhile, New Zealand Oil & Gas also announced it was increasing its stake in the PEP 38483 licence, from 15% to 18.9%, ahead of the 3D seismic. Pan Pacific Petroleum is also increasing its stake from 10% to just over 14%.
Equities in the two Taranaki Basin blocks upon satisfaction of various conditions, including government approvals, will be:
PEP 38483: AWE New Zealand Pty Ltd (operator) 44.317%, Mitsui E&P New Zealand Limited 22.728%, New Zealand Oil & Gas (via subsidiary Stewart Petroleum Company Limited) 18.864%, and Pan Pacific Petroleum (via WM Petroleum Limited) 14.091%.
PEP 38460: New Zealand Overseas Petroleum Limited (operator) 45%, AWE New Zealand Pty Ltd 20%, Mitsui E&P New Zealand Limited 12.5%, Stewart Petroleum Company Limited 12.5% and WM Petroleum Limited 10%.
