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New Zealand Oil & Gas (NZOG) has been awarded a new exploration permit for an area next to the Kupe development off the coast of south Taranaki.
Crown Minerals has notified NZOG that it had been successful in its application for a permit to explore an area covering approximately 3000sq km to the south and west of the Kupe field.
Regional analysis of source zones and its closeness to Kupe indicated there was a favourable chance for oil or wet gas.
Rough estimates from the preliminary mapping indicates the potential for up to six structures ranging from 10 to 100 square kilometres in size.
The current Kupe mining licence covers an area of 257sq km.
The company was keen to get the work programme under way and enlist the seismic survey vessel Pacific Titan, which was currently in New Zealand waters, said NZOG chief executive David Salisbury, in an announcement to the New Zealand stock exchange.
The permit contained a "fairway of structures" that NZOG had identified and labelled the Gamma prospects.
"There are a number of separate closures formed by upper Miocene sands, eroded by submarine channels, which were then in-filled by younger mudstones," Mr Salisbury said.
"These mudstones may have formed an effective lateral seal, trapping oil and/or gas. Similar oil bearing structures are known to exist in the Sacremento Valley in California and in the Gulf of Mexico."
NZOG would not be releasing any estimate of the potential recoverable resources contained in the Gamma prospects until it had more information, he said.
"What we can say at this early stage is that the Gamma prospects are a very welcome addition to NZOG's exploration portfolio."
The permit has been awarded for an initial term of five years, with the potential for a second term.
An evaluation programme will be carried out in the first two years with a decision on drilling an exploration well to be taken at the end of the second year.
- NZPA
