By New Zealand Correspondent Neil Ritchie
LONDON-listed Kea Petroleum has farmed out its onshore Taranaki lease PEP 51153, containing the potentially commercial Puka oil discovery, to MEO Australia – marking the company’s entry into the New Zealand exploration and production scene.
After months of hinting about the proposed farm-out, Kea announced in early April that MEO would earn a 30 per cent interest in PEP 51153 by funding NZ$4 million of a planned NZ$5 million first-phase work program intended to boost existing production and assist future field appraisal.
Phase One involves workovers of the existing Puka-1 and 2 wells, and the drilling of Puka-3 from the existing pad to further increase production and appraise the prognosed primary channel sand identified in a recent 3D seismic survey.
It also involves further testing of the suspended Douglas-1 well – testing of the fractured Oligocene-aged Tikorangi limestones, and confirming the northern extension of the Puka field at the Miocene-aged Mount Messenger level.
Melbourne-headquartered MEO also has the option of earning an additional 20% interest by funding NZ$7.5 million of the proposed NZ$9 million second-phase work program intended to further appraise and commercialise Puka, which is situated along the eastern margin of the Taranaki basin.
This would involve developing a new surface location from which the central portion of the field can be accessed with further drilling, potentially including horizontal wells, together with the design of a full field development plan and the establishment of permanent production facilities.
It is known that Taranaki’s complex geology has frustrated Kea, as it has other juniors such as Canada’s listed New Zealand Energy Corporation, so Kea is welcoming MEO’s technical expertise in geologically similar turbidite fields.
NZEC and partner L&M Energy have restarted two more Tariki, Waihapa and Ngaere (TWN) oil wells during March and another two during April.
NZEC also announced its calendar year 2013 year reserves estimates of proved and probable (2P) reserves estimated at 1.2 million barrels of oil (or 1.6 million barrels of oil equivalent) having an after-tax net present value, discounted by 10%, of C$57.9 million.
At the same time, another North American junior with one eye on New Zealand, Canadian Overseas Petroleum (COPL), dual listed on the Toronto Stock Exchange and London Stock Exchange.
The Calgary-headquartered company is focusing on New Zealand, presently just its 50% stake in lease PEP 53806, and on Africa, where it has a 17% interest in offshore Liberia Block LB-13 with operator ExxonMobil holding the other 83%.
COPL has a free carry for its share of the first US$120 million of drilling costs of a two- well wildcat offshore African exploration program planned for 2014.
In New Zealand, COPL holds a joint stake in the onshore East Coast lease with fellow Calgary company Marauder Resources acting as operator through its subsidiary Endeavour Energy (NZ).
This permit contains a number of large oil and gas accumulation targets as unconventional resource plays linked to the Whangai and Waipawa shales, which, COPL says, exhibit characteristics similar to those of the productive Bakken Formation in Saskatchewan and North Dakota.
Oil taken from surface seeps in the basin is sweet, light, 50 degree API crude and has been geochemically typed to these marine shales.
Fellow Canada-listed junior East West Petroleum has announced a minimum committed 2014 capital expenditure in New Zealand of about C$10.4 million.
This is in conjunction with Vancouver-listed junior TAG Oil, which is operator of the onshore Taranaki Cheal, Sidewinder and Southern Cross leases.
East West said it and TAG will drilling three wells from the Cheal G-site, at least one from the Cheal E-site and one at the recently acquired Southern Cross permit north of and inland from Stratford.
Further wells to the 2014 drilling program are expected to be added following the completion and interpretation of the results of the current campaign.