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New Zealand’s second largest private energy company, Greymouth Petroleum, believes there are “vast undiscovered” deep gas resources in the Taranaki Basin (mostly from Eocene-aged formations) becoming economic to develop, as well as in the Great South Basin where the company holds one licence.
Speaking at the Petroleum Conference, Greymouth Petroleum chairman Mark Dunphy disputed claims that we have an over-supply of gas, saying there was only “contractual indigestion” at present, and some buyers had over-paid for significant tranches of gas, which was a probable reference to buyers of gas from the northern near-shore Pohokura field. Take or pay provisions for Pohokura gas are known to be the tightest yet signed in the country. While there might be enough gas for the next nine, or possibly the next 11 years, the country was still facing a long-term gas shortage, he says, which means offtake counterparties, such as new base-load gas-fired power stations, won’t make capital commitments. He also called for domestic gas market intervention, accusing gas pipeline owners of allowing wholesalers to use transmission pipelines for gas storage rather than delivery. This was a probable reference to the gas transmission bottleneck currently holding wholesale gas prices up in the Auckland market. On the oil front, Dunphy was more positive, joining other conference speakers in beating up the country’s exploration potential. Greymouth Petroleum is only second behind Todd Energy, both in terms of reserves and production, he says, with reserves totalling about 80 million boe and annual production of about 10,000 boe. He reckons Greymouth, the largest onshore Taranaki permit holder, will be the most active explorer with the drill bit this year, as it was in 2008. At the time of the conference last month, the recently drilled Ohanga-2 sidetrack well was about to be tested and the Tiger Rig, belonging to Greymouth subsidiary Bonus Drilling, was about to start the nearby Kaimiro-2 sidetrack, a deep gas probe targeting Eocene-aged formations, as opposed to the field’s shallower producing reservoirs. Although he did not mention it, Greymouth also drilled the coastal Waimanu-1 sidetrack well at New Plymouth Airport earlier this year. Dunphy says that following on from Kaimiro, the explorer plans more wells at its nearby Turangi and Kowhai gas-condensate fields, as well as two wells further south. Dunphy also talked about energy-constrained Chile, where his company has recently made three gas discoveries near Tierra Del Fuego. Chile imported about 98 percent of its oil and 75 percent of its gas, so Greymouth’s recent signing of an offtake agreement should be the start of alleviating the South American’s chronic domestic gas supply shortage. He told delegates that Greymouth’s aim was to achieve a 50/50 mix of petroleum production from Chile and from New Zealand.
Energy NZ Vol.4 No.6 November-December 2010 |
The company is targeting total reserves of 160 million barrel of oil equivalent (boe) and annual production of about 40 million boe by 2014-15.