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- Release Date: 26/09/12 14:13
- Summary: GENERAL: NZO: NZOG confirms commitment to drill
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NZO
26/09/2012 12:13
GENERAL
REL: 1213 HRS New Zealand Oil and Gas Limited
GENERAL: NZO: NZOG confirms commitment to drill
The Kakapo prospect off the South Taranaki coast will be drilled when a
suitable rig can be negotiated, New Zealand Oil & Gas Limited confirmed
today.
NZOG was awarded the permit for the Kakapo prospect (Permit 51311) in 2009.
The terms of the permit required the company to choose by this week whether
to commit to drill or relinquish the permit.
Chief executive Andrew Knight says the drill commitment reflects the
company's enthusiasm for the prospect and emphasises NZOG's intention to step
up its exploration activity.
"NZOG has assessed the potential for Kakapo to be several times the size of
the Tui or Maari fields. This has the potential to make a considerable
contribution to our community and the New Zealand economy.
"NZOG has sought to further reduce equity in the prospect beyond our
previously announced arrangement with Raisama Energy Ltd. We have made this
commitment in the confident expectation that additional partners will join
the venture ahead of drilling.
"NZOG is confident enough to move forward with the commitment at its current
equity level. The prospect looks attractive as part of a portfolio of
opportunities for new entrants to New Zealand," Andrew Knight said.
NZOG is reviewing options to secure a rig to drill Kakapo and expects the
drill timetable to be confirmed within the next 6 months.
Kakapo lies in about 95 metres of water 25 kilometres west of the Kupe
gas/condensate field. An exploratory well will be drilled to confirm seismic
indications of the prospect.
The Kakapo prospect is a stacked series of inter-bedded Miocene coastal sands
and shale from a depth of about 1600 metres, which are laterally truncated
and considered to be sealed by deep, shale-filled canyons. It has
prospective recoverable resources of 41 million barrels of oil in the "most
likely" (P50) case for the main target sand alone; allowing for additional
levels both above and below, and the possibility that the trap is filled all
the way to its maximum spill point, there is potential (P10, "possible") for
up to several hundred million barrels of oil in total.
NZOG has an agreement for Kakapo with ASX-listed Raisama Energy Ltd, which
will earn a 10% stake in the permit by paying 20% of the first well costs,
with the carry capped at US$3 million. The well is expected to cost in the
range of US$25-30 million.
Attachment: NZOG South Taranaki permits
End CA:00227750 For:NZO Type:GENERAL Time:2012-09-26 12:13:17
