Black gold for tiny well driller

By PAULA OLIVER

Although tiny by international standards, Wellington oil company Indo-Pacific Energy yesterday gained a satisfying victory when it was revealed that oil giant Shell wanted to buy back into its Goldie-1 oil well in Taranaki.

Indo-Pacific had drilled the onshore well at sole risk and considerable cost after its partners Shell Oil and New Zealand Oil and Gas wrote off the prospect.

Indo Pacific is led by long-time New Zealand resident Dave Bennett, and is listed on the American Stock Exchange.

Going ahead with drilling by itself proved worthwhile - since being uncovered, the Goldie-1 well has been steadily producing between 500 and 700 barrels of oil a day. Although not large by international standards, Goldie's reserves are now estimated at between 500,000 and 1,500,000 barrels.

Dr Bennett said yesterday that Shell, which holds almost 60 per cent of the field's licence, had decided to come back into the project.

That meant paying its share of the original drilling costs - around $2 million - to Indo-Pacific. The tiny oil company would also claim a larger sum from net revenues.

"Basically I suppose we turned out to be right on this occasion," Dr Bennett said. "You're often wrong in oil exploration, but there was a lot of technical work that went on by all three parties. So we were right for the right reasons."

Dr Bennett said it was a marginal call for Shell to re-enter the Goldie field because the well was small. But further drilling was planned.

The oil produced from Goldie-1 is going to New Plymouth to be sold to Fletcher Energy, now owned by Shell.