New drilling aims to extend Tui rig’s life
New Zealand Oil & Gas has started drilling in the Oi prospect in its latest play to extend the life of offshore infrastructure that is servicing the declining Tui oil field.
Situated to the north of Tui in a different geological structure, the company says the Oi prospect has “sufficient estimated potential size to contain commercial amounts of hydrocarbons”, with the main uncertainty being whether Kapuni F10 reservoir sands are present.
“NZOG considers the well has a 17 per cent geological chance of success, and a 16 per cent chance of commercial development.”
The well follows the discovery of hydrocarbons in commercial quantities at the Pateke-4H well, drilled earlier this year, which will be tied back to the floating production platform already processing other wells in the Tui prospect.
AWE is the operator on the Oi well, with a 31.25 per cent holding, Pan Pacific Petroleum holds 50 per cent and NZOG is in at 18.75 per cent. The three joint venture parties hold 57.5 per cent, 15 per cent and 27.5 per cent of the petroleum mining permit that covers both Tui and Oi.
Total cost of the well is US$27 million ($31.8 million), of which NZOG’s share is US$5 million, with potential to drill a sidetrack well on a full equity share basis, should encouraging signs be found.