Rich frontiers beckon

New Zealand has huge ‘Saudi-sized’ oil and gas potential in the deepwater surrounding the country, says GNS Science hydrocarbons marketing manager David Darby.   BY NEIL RITCHIE

The country has the fourth-largest exclusive economic zone in the world and over 30 percent of it is sedimentary basins, says GNS Science hydrocarbons marketing manager David Darby. Some of those basins are mature with sediments exceeding 10 kilometres in thickness, and look ripe for exploration.

He estimates up to 10 billion barrels of oil, or the equivalent, could be recovered from future discoveries around the country, particularly from the deepwater basins that include the Great South Basin, Deepwater Taranaki Basin and Northland Basin.

“The deepwater frontiers of New Zealand beckon,” he says.

Darby highlights the adverse ongoing economic impact of having to import nearly  all our oil. New Zealand’s self-sufficiency in oil has slumped from a high of about 50 percent during the 1990s to its present level of only 13 percent – or about eight million barrels from Taranaki’s producing fields.

Existing data also suggests that the country’s oil

production peaked in 1997, and gas flows peaked in 2000.

“It is declining much faster than previously predicted, due to our increasing consumption of oil, and this means we import a huge amount of oil into New Zealand with an enormous impact on our balance of payments.”

It means an annual bill exceeding US$3 billion ($4.3b) to make up the shortfall, he adds.

Taranaki, the country’s only commercial oil and gas region, was still under-explored by world standards, he says, with only a total of about 400 wells drilled so far, compared with the thousands that had been drilled in the similar-sized British portion of the North Sea.

Potential source rock volume for  deepwater Taranaki was about 20,000 cubic  kil ometres, with potential oil in place of about three trillion barrels.

 Taranaki is only a tiny proportion of New Zealand’s EEZ, Darby adds. About 50 potential oil-bearing structures had already been identified in the Northland basin, five of them measuring more than 100 million square kilometres, and the East Coast basin has layers of sedimentary rocks 13 kilometres deep, though its geology was almost totally unknown.

Between Wellington and Marlborough was the Pegasus Sub-basin, relatively unknown, but “large, thick and the right age”.

The offshore Taranaki and Northland basins have the potential to be another North Sea “with a greater density of exploration and more  different play concepts”. New Zealand could become another Norway, he says. Both  countries are long, thin land masses, with similar geographies, populations and energy mixes.

“It might take a while but the potential is definitely there,” says Darby.