By FIONA ROTHERHAM
Partners in the Maari oilfield off Taranaki have signed a joint-venture agreement allowing development to proceed after months of delay.
Shell Petroleum owns 49 per cent, Austrian-based OMV 30 per cent and Todd Petroleum 21 per cent.
The operator, Shell Todd Oil Services, said last year that Maari was feasible,
with 40-50 million barrels of recoverable oil.
Total development costs were expected to be about $250 million.
But work was held up for nine months while the joint-venture deal was bedded down.
OMV finance director Markus Turczyn said the delay was mainly caused by Todd - in a classic case of the tail trying to wag the dog - wanting the right to veto the development although it was the minority partner.
A compromise had been reached giving Todd an easy exit clause whereby it could sell its interest to the other partners for an agreed sum.
"We have all lost money by not bringing out the reserves as soon as possible. But it is a good project and we can now accelerate the whole development."
Further 3D seismic work will be done and another appraisal well is likely to be drilled late this year at a cost of about $14.5 million.
A range of development options is being considered, with production likely in 2003.
Shell Todd Oil Services took over as operator of PEP 39413 in 1996 when Shell and Todd farmed into the former Cultus licence.
Last September, OMV concluded a hostile takeover of Cultus, linked to a group of New Zealand investors headed by Sir Michael Fay and David Richwhite.
The 1998 finding of the Maari field 80km off the coast confirmed oil deposits exist in the Taranaki Basin. Oil was originally discovered in the Miocene Moki Formation in 1983, when Moki-1 made a small find. Maari-1 was drilled just 800m away from the original well and found three hydrocarbon-bearing zones Shell Todd has said the nearby Pike and Maui-4 prospects might be put into production.
