New Zealand Oil & Gas [NZX: NZO], the exploration company, says its total costs for the Pateke-4H prospect in the Tui field off the Taranaki coast will be US$40 million to US$46 million including the tie back to the floating storage/production vessel Umuroa.
Costs of the project include the $25 million for NZOG's share of exploration and drilling. NZOG has 27.5 percent of Tui while operator AWE has 57.5 percent and Pan Pacific Petroleum has 15 percent. The costs "increased beyond the pre-drilling estimate" because of significant extra work to mitigate mechanical difficulties and drill two sidetracks, NZOG said today.
The company's initial evaluation of the resource estimates 2.5 million barrels, of which its share would be 687,500 barrels.
"Preparations are being made to run the completion and suspend the well to enable production in the first quarter of 2015," it said.
Last month, chief executive Andrew Knight told BusinessDesk potential Pateke production would bolster output rather than extend the life of the Tui oilfield.
NZOG's shares gained 1.3 percent to 78.5 cents, and have slipped 3.7 percent this year.
This article is tagged with the following keywords. Find out more about MyNBR Tags
Most listened to
- Massey University's David Tripe on why CBA is selling its life businesses at a loss
- As much as the leaders will bask in a win, they will both face challenges as prime minister, comments Rob Hosking
- Fisheries Inshore NZ chief executive Jeremy Helson says many in the industry have concerns about new fishing regulations
- Perry Group chairman Simon Perry explains why Hamilton needs a $1 billion development in a disused quarry
- Jacinda Ardern has sure been talked up a lot by the media, claims David Cohen
- NBR Radio: best of the week ended September 15, with Grant Walker