Maari appraisal positive

By CHRIS DANIELS

Oil may soon be flowing from the as-yet-untapped Maari field off the Taranaki coast.

Austrian oil giant OMV says its appraisal well in the Maari oil field has been successful, meaning that it is likely to be commercially viable.

A semi-submersible drilling rig has been off the Taranaki coast since November, where it has been working for a consortium of New Zealand and foreign companies.

New Zealand firm Todd Energy is spending $26 million on its programme, which involves exploratory and appraisal wells with other partners.

OMV says that it envisages a development based on a floating production, storage and offloading system for Maari, similar to that used at the Maui field.

Drilling at the Maari 2 site began on January 10, in 103m of water; it has reached a depth of about 1500m.

The "interest holders" in this drilling site are OMV, with 69 per cent, local company Todd Petroleum Mining (16 per cent), listed Australian company Horizon Oil (10 per cent) and Delta Oil Taranaki (5 per cent).

OMV describes Maari as the largest undeveloped oil field in New Zealand. It was first discovered in 1983. Appraisal wells in 1985 and 1998 showed it contained a significant amount of oil.

While many wells off the Taranaki coast are being drilled by companies looking for oil, the search continues for new gas fields to replace the dwindling supply from Maui.

Maui, which supplies 80 per cent of New Zealand's natural gas, is due to run out ahead of schedule, in 2007.

Major gas users and the electricity industry want more exploration to ensure new supplies are available.

Energy commentators say there is an increased risk of electricity shortages in the event of low water levels in the South Island hydro storage lakes.

The Maui field has the ability to "swing", meaning more gas can be extracted from it if needed - such as during a dry year when the gas-fired thermal power stations in the North Island are required to run harder.

The Pohokura gas field, to the north east of New Plymouth, is New Zealand's largest development prospect. Production from Pohokura, which has reserves estimated at 27 billion cu m of gas and 53 million barrels of oil condensate, is expected to begin in 2006.