One-time minnows NZ Oil & Gas and Pan Pacific Petroleum are now swimming with the big fish on the stock exchange. NZOG is sitting on a cash mountain of $290m and Pan Pacific on $A80m from the Tui oil bonanza. NZOG’s June year profit soared 1326% to $97m from its 12% stake in the Tui project and shareholders are to get an extra 5c final dividend, adding to the 5c paid in April. Sydney-based Pan Pacific which has 10% of Tui reported a net profit for the June year of $A52.4m Overseas refineries (mainly in Aust) paid an average $NZ125 a barrel for the light, sweet crude from Tui. Though Tui’s reserves were lifted to around 50m barrels, production in the coming year is expected to decline from around the 42,000 barrels a day mark which was achieved in its first full year. NZOG’s share of that could drop from the 1.8m barrels a day to about 1m barrels.

Meanwhile operator of the field Australian Worldwide Exploration (AWE) has disclosed it is planning a $A300m 6-to-8 well campaign over nine months starting in early 2009, which will focus mainly on the Tui field. AWE says it wants to accelerate the next phase of drilling in its Taranaki permits, though timing is contingent on rig contracting. Analysts say AWE appears to think there are several potential reservoir extensions to the main Tui pool. As many as four appraisal wells may be drilled in the area plus a previously announced third horizontal development well Tui-4H into the Tui pool.

In a presentation outlining its exploration programme AWE has identified 4 potential reservoir areas to the south and east of the Tui pool. They are named as Kahu Crest, Kahu Stratigraphic, Tui North East and Tui South East, which are shown on an AWE map as linked together by a narrow “waist,” and Tui South West. The map shows 2 of the wells would be drilled from near where the two present Tui wellheads (Tui-3H, and Tui-4H) are sited.

One of the new wells would go into the Tui South West pool, a 2/3km wide potential reservoir extension to the main pool. The Tui- 4H would be drilled to the northwest part of the main Tui pool. Three other wells would be drilled from a site 6km to the east to test three other potential reservoirs called Tui NE, Kahu Crest and Kahu Stratigraphic. One of the presentation graphics has marked out an undersea terminal for a gas export line from the Tui field to the Maui gas field, which lies less than 20km from Tui.

AWE says during its Taranaki campaign it also plans to drill an exploration well Hoki-1 into its Hoki prospect in PEP38401 where the company has located a substantial closure. AWE’s profit for the June year was $A264m, up 647% on the previous year, due it says to the “exceptional initial performance of the Tui oil fields.” The company paid NZ income tax of $131m and NZ royalties amounting to $73.8m.

 Copyright © Media Information Ltd
NZ Energy & Environment Business Week