NZOG head optimistic about Tui field's potential for oil

By IRENE CHAPPLE

New Zealand Oil & Gas chairman Tony Radford expressed "cautious optimism" over drilling prospects at Friday's annual meeting, but shareholders remained frustrated.

Over mini croissants and quiches provided after the meeting, which lasted just under an hour, one remarked that the company should be more aggressive.

"They are a very easygoing company," the shareholder commented. "But they need to be aggressive ... finding water is no good."

He was referring to the water found in the Tariki formation, in the Tuihu well. The well's prospects were canvassed briefly during the chairman's speech.

Radford said the second target in that well was the Kapuni formation and a result on its evaluation should be announced soon.

He said the operations at Ngatoro oil field were being stalled by technical disputes with co-venturer Greymouth Petroleum, but it remained a valuable asset.

The planned Pike River coalmine was waiting on a decision from Conservation Minister Chris Carter on land access, following studies detailing water runoff from the mine during its operation and on closure.

Radford said the Kupe gasfield was expected to start production in four years.

There might also be some change in ownership as Genesis Power looked to sell some of its equity but NZOG was unlikely to increase its stake this year.

Prospects for the Tui field were promoted as the biggest news of the meeting.

Radford said the company was "increasingly optimistic" about the potential for commercial development after oil was discovered. Further surveys had showed similar prospects and oil production might begin within 18 months.

Radford said he hoped the shares would soon begin to better reflect the company's value.

The chairman - who is also a founding director of the company - came in for some bouquets. One shareholder remarked the company was lucky to have such a dedicated man at the helm. And, said another: "They provide lovely orange juice."