According to New Zealand Petroleum and Mining (NZPAM), New Zealand is seeing exciting times ahead in regards to oil and gas drilling. The country is at the start of a 40 year cycle in exploration, beginning with at least three oil rigs drilling up to 13 holes during the year ahead.
Simon Bridges, the Minister for Energy and Resources, spoke recently at a petroleum conference in Wellington, telling the 300 delegates more than NZ$ 8 billion had spent in exploration in the sector in the past six years, and that NZ$ 300 million in corporate tax and NZ$ 400 million in royalties had been earned in the past calendar year.
“If any one of the other 17 basins have the same [oil and gas resources] of Taranaki, that would be a game changer for the sector,” Mr Bridges said.
New Zealand’s energy province, Taranaki, is home to all of the nation’s current oil and natural gas production, and 90% of the industry’s nationwide employment.
2014 block tender offer
Mr Bridges announced formal consultation has begun for the 2014 block tender offer, which includes the combined Great South and Canterbury Basins, Pegasus Basin off the Wairarapa coast, the Reinga and Northland Basins in northwest New Zealand, the New Caledonia Basin and the offshore Taranaki Basin.
The 2014 offer for five offshore and three onshore blocks will start consultation with regional authorities and iwi with tenders closing by the end of November. Successful applicants will be announced in April next year. There have been 21 nominations for areas from 11 companies.
“New Zealand has a large number of opportunities. Demand for oil and gas has never been better,” Mr Bridges said.
Government investment in oil and gas
The Minister for Energy and Resources also said there would be “significantly more” investment in the sector by the government.
He pointed to the technical data collation work by NZPAM, which has had boosts to its budgets, and its availability, and said the relatively new High Hazard Unit of the government could expect to see its budget increased from NZ$ 50 million to NZ$ 80 million.
Carrying out safe oil and gas exploration operations
Mr Bridges did acknowledged environmental concerns, especially with regard to deepsea drilling, which has has been proposed around Otago, in the south of the South Island.
Mr Bridges emphasised the recent regulatory changes which have targeted safer work practices to ensure companies are capable of carrying out exploration safely.
NZPAM General Manager David Binnie said New Zealand had begun to “build momentum” in the past two years. Test well numbers per annum have risen from 37 in 2009 and 45 in 2010 to 52 in 2011.
According to Mr Binnie, while the industry was “lifting its game”, only Taranaki had been targeted in the past, and the scope had “the potential to be much bigger.”
“It's a 40 year cycle – we're on the edge of a new resources era,” he concluded.
Edited from various sources by Cecilia Rehn
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