Offshore staff

WELLINGTON, New Zealand – New Zealand Oil and Gas (NZE:NZO) is looking to rename and drill the Kaupokonui prospect in the offshore Taranaki basin.

The structure, in the PEP 51311 concession, comprises various vertically-stacked potential reservoir sands with un-risked recoverable oil resources of 200 MMbbl.

Seismic modelling has improved the chance of success through indications of a small gas cap on the main (assumed) oil column.

NZ Petroleum and Minerals has extended the drill or drop deadline until January 2012, but NZOG hopes to drill in the coming southern hemisphere summer, and is investigating rig options.

Under a farm-in agreement, Raisama will earn a 10% interest in the permit by contributing 20% of the cost of the well. NZOG continues to pursue further farm down of its exposure to the cost of drilling.

Elsewhere in the Taranaki basin, NZOG has a 15% interest in the PML 38146 (Kupe) permit, which contains the producing Kupe Central Field area, and other prospects and leads.

The partners are conducting further geological and geophysical studies that could lead to one or more prospects being drilled in conjunction with scheduled second-stage Kupe development drilling, potentially in 2013

In the northern part of the basin, NZOG has a 50% interest in the PEP 51558 (Kanuka) permit, where Todd Energy has become operator following the withdrawal of AWE and Mitsui.

A large 3D seismic survey acquired by a previous team in 2007 will be reprocessed to improve definition of deep targets within the Kapuni sandstones. These have proven effective reservoirs in the northern part of onshore Taranaki.

In New Zealand’s offshore Canterbury basin, NZOG retains a 40% interest in PEP 38259, containing the Barque gas-condensate prospect.

The joint venture is still waiting for the government to respond to a change of conditions application, which would extend the time available to evaluate the cost of drilling and developing Barque and to seek a suitable rig.

However, NZOG has withdrawn from an application for a block immediately to north of PEP 38259.

07/29/2011