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Kea plans to drill
31 August 2010 - Kea Petroleum has taken over from Genesis Energy the onshore-offshore PEP 381204 permit on the north Taranaki coast south of Kawhia. They plan to drill relatively shallow prospects offshore with both gas and oil potential that are cheaper to drill than the deeper Mangatoa gas prospect.
Sources: Kea Petroleum and Lindsay Clark
The company’s wholly-owned subsidiary Kea Oil and Gas Ltd has obtained the Minister of Energy’s approval for acquisition of a 100% interest in the 516 sq km area permit, mostly offshore, which was formerly owned by Genesis subsidiary Genesis Power Ltd.
The company considers the shallower Felix and Waikawau prospects are considerably cheaper and more accessible to drill, and offer opportunities to find both oil and gas. The Mangatoa prospect offshore needs further depth mapping to define it.
Kea considers a well drilled from onshore could be easily deviated offshore to test a sands within the Felix trap, while also testing the oil bearing potential of the Miocene sands found by other offshore wells drilled nearby.
In the past three years, Genesis has significantly advanced the technical database for the area. A range of studies have been undertaken and extensive onshore to offshore 2D seismic acquired. However, more technical evaluation is needed to better define and rank the identified prospects and leads, before a preferred initial drilling target is decided.
Kea said it would complete its technical evaluation in the coming months, prior to the April 2011 well commitment date for drilling by the following year.
Dave Bennett, CEO of Wellington-based and London-listed Kea Petroleum, said drilling offshore targets from onshore opened up the potential of bringing both shallow oil discoveries and gas finds into profitable production.
Under the terms of its deal with Genesis Energy, the electricity generator will hold a right of first refusal to purchase a portion of gas discovered in the permit. Kea will repay Genesis' past costs incurred on the permit.
