Wellington-based investment banker and broker McDouall Stuart says that given the Australian Worldwide Exploration-operated project's deliverability strength to date, significantly outperforming pre-development production modelling, "an upwards revision is likely" to the latest 41.7MMbbl 2P estimate.

AWE managing director Bruce Wood told journalists at a briefing at APPEA that the company expected to announce a reserves upgrade in the near future.

McDouall Stuart says in its latest report on NZOG that AWE should be able to extract another 500,000 barrels from Tui this June financial year, even though water cut is increasing and daily oil production is starting to decline.

Average daily production first increased by about 3000bbl, to 45,600bbl, after debottlenecking on the floating production storage and offtake vessel Umuroa finished in mid-November, the broking firm said.

However, water cut was now increasing (to more than 30% of the gross liquids stream) and oil production was entering its projected decline.

The project produced its 11 millionth barrel on April 13, and the last million barrels took 25 days to produce, implying an average daily production rate of only 40,000bbl, McDouall Stuart said.

But the company still considered the Tui partners' latest production estimate of 13MMbbl for the year to be conservative, as this implied average daily production to the end of June of only 27,000bbl.

Therefore, McDouall Stuart said it had increased its estimate to 13.5MMbbl, which equated to average daily production of 33,000MMbbl for the remainder of the June year.

McDouall Stuart also said it expected the outcome of the formal review of field reserves to be known by the end of June.