New Zealand upstream oil and gas update

An update on upstream activities in New Zealand, including 2015 block proposals, confirmation of 2014 block offers, and an update from Pan Pacific Petroleum.

Proposed Petroleum Block Offer 2015

Last year, Energy and Resources Minister Simon Bridges opened up consultation on the proposed Petroleum Block Offer 2015.

The proposal includes three onshore areas and four offshore areas. The total acreage included in the proposal is over 476 000 km2, compared with the 434 000 km2 the government consulted on for Block Offer 2014.

The proposal includes:

  • 15TAR-R2 Onshore Taranaki Basin (1290.1 km2).
  • 15WEC-R1 Onshore West Coast Basin (2523.9 km2).
  • 15WEC-R2 Onshore West Coast Basin (2036.2 km2).
  • 15PEG-R1 Offshore Pegasus and Offshore East Coast Basins (79 067.4 km2).
  • 15NRN-R1 Offshore Northland-Reinga Basins (187 851.8 km2).
  • 15TAR-R1 Offshore Taranaki Basin (61 484.7 km2).
  • 15GSC-R1 Offshore Great-South Canterbury Basin (141 756.6 km2).

The government will consult with affected iwi, hapu and local authorities until 9 February. The purpose of consultation is to give affected parties the opportunity to identify sensitive areas not already protected by legislation. Options for additional protection include removing areas from the Block Offer, or putting conditions on activities within the area to recognise its importance.

Once consultation is complete a final tender for petroleum exploration permits will be announced in March 2015.

Overview of Block Offer 2014 permits

Bids for Block Offer 2014 closed in October and were assessed according to criteria set out in the Crown Minerals Act 1991, the Petroleum Programme 2013 and the Block Offer 2014 Invitation for Bids.

Assessors considered the bidder’s work programme and other criteria including their technical and financial capability, their compliance history and their likely ability to meet health, safety and environmental requirements.

Six onshore permits were awarded and nine offshore ones. Companies granted permits include Mosman Oil & Gas (NZ) Limited (3), TAG Oil (NZ) Limited (2), Statoil New Zealand B.V. (4, three in joint partnership with Chevron New Zealand Exploration Limited), OMV New Zealand Limited (2), Petrochem Limited (1), New Endeavour Resources (NZ) Limited (1), ONGC Videsh Limited (1), and Todd Exploration Limited in partnership with Beach Petroleum (NZ) Pty. Limited (1).

Tables of awarded permits can be found here.

Oil reserves at offshore Tui fields raised

Pan Pacific Petroleum NL (PPP) and New Zealand Oil and Gas Ltd. (NZOG) recently completed a review of the increase in Tui reserves attributable to the Pateke-4H well in petroleum mining permit (PMP) 38158 offshore New Zealand, and estimate a total increase in 2P recoverable reserves of 2.4 million bbls gross, 360 000 barrels net to PPP as at 1 January 2015.

This comprises 1.9 million barrels from the Pateke-4H accumulation and an additional 0.5 million barrels from the other Tui Area Fields as a result of the extension of economic field life. This estimate excludes any additional oil, which will be used as fuel.

The Pateke-4H estimate will be reviewed and updated when the well is on production and actual performance can be compared with the forecast from the current model. The well is scheduled to be tied into the FPSO in 1Q15, with production in 2Q. The effect of Pateke-4H on the extension of the economic field life of the Tui Area Fields is dependent on oil price, and includes an assumption of a return to higher oil prices during the field life.

The joint venture partners in PMP 38158 are: Pan Pacific Petroleum NL (via subsidiaries) (15.0%), AWE Limited (via subsidiaries) (Operator) (57.5%), New Zealand Oil & Gas (via subsidiaries) (27.5%).

Edited from various sources by Cecilia Rehn

Published on 06/01/2015

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