PCL, BLO, AWE, ITC, page-7

Stones won't throw Huinga-1 partners
June 17 2002




Fracture zones are yielding positive results in New Zealand's Taranaki Basin, writes Jane Counsel.


In the oil and gas game, fracture zones usually turn out to be nothing more than hard rocks that provide frustrating obstacles to exploration drilling.

But that hasn't been the case for the partners in the Huinga-1 well in New Zealand's onshore Taranaki Basin which updated the market on the well's progress last week.

The Huinga-1 partners are actually finding that those annoying rocks are yielding some promising oil and gas shows.

Yes, drilling has been painstakingly slow but as Huinga-1's Australian partners Pancontinental Oil, Bligh Oil and AWE have since revealed, their patience is finally paying off.

The trio are growing increasingly confident that there are other major reserves of oil and gas in addition to their targeted Huinga prospect, which is estimated to contain 46 million barrels of oil and 161 billion cubic feet of gas. The partners said testing procedures to evaluate the potential additional reserves would now be addressed in the well program for Huinga-1.



But with the share prices of all three partners failing to move on the news, it appears the market's yet to catch on to the project.

Elsewhere, the partners in the Hovea oil discovery should have some more news soon; an appraisal well on the prospect was spudded over the weekend.

It is hoped the well, in the Perth onshore basin, will confirm a reserve of as much as 80 million barrels for Hovea, which analysts rate as a company maker for junior partner Arc Energy.

The Eric Streitberg-led Arc is counting on the well to justify its decision to fend off Tap Oil's advances a few weeks back.