Award of New Permits Set to Open Up Northland for New Oil and Gas Exploration

The Associate Minister of Energy, Hon Harry Duynhoven, today announced the award of two large offshore exploration permits in new exploration investment in the Northland region.

The permits have been issued to a joint venture comprising major petroleum exploration and production companies Origin Energy from Australia and OMV from Austria.

"These companies are an important part of the exploration industry in New Zealand, with successful track records in exploration. The exploration programmes are an exciting development for Northland as well as a further step forward to stimulating exploration in oil and gas in New Zealand," Mr Duynhoven said today.

The permits involve an initial work commitment of $15 million, with up to a further $120 million to be expended at subsequent stages of the exploration programmes.

The permits have been issued following a competitive bidding process for offshore blocks in Northland and Taranaki.

They have proposed major exploration programmes over 11,000km2 of acreage including acquisition of significant volumes of new seismic data and drilling of exploration wells.

Mr Duynhoven said that the absence of any bids in the neighbouring Outer Taranaki Basin was disappointing, but understandable given the impact of last year’s hurricanes on exploration activity in general, and the availability of seismic vessels and drilling rigs in particular.

“We believe that there is still potential interest in the unallocated blocks, and we will therefore be re-offering these blocks for a short period with reduced minimum work requirements in the expectation of additional bids.

“I remain confident regarding interest in the upcoming East Coast and Great South Basin blocks offers.

“The seismic surveys which the Government commissioned for the two most recent blocks offers will significantly aid companies in preparing bids, and I am confident that this will result in high quality applications,” said Mr Duynhoven.

Mr Duynhoven also commented that he was aware that domestic and overseas international companies were concerned about the international availability of drilling rigs in terms of complying with any permits awarded to them.

“While companies need to honour their bids, we will be taking a reasonable and pragmatic line if worldwide shortages impact on exploration commitments,” said Mr Duynhoven today.

For further information contact:

Jamie Gray

Private Secretary

Associate Minister of Energy

Tel: 04-471-9818 or 021-227-9818

Adam Feeley

Group Manager, Crown Minerals,

Ministry of Economic Development

Tel: 021-333-539