The attraction of the large potential represented by Mangatoa was offset by the expected tight reservoir being associated with significant risks in obtaining adequate gas flow rates and resulting in potentially high development costs.
While New Zealand Oil & Gas was keen to see Mangatoa drilled, and was prepared to contribute some funds for that purpose, it was not prepared to over-extend itself on a single prospect with costs for an initial well likely to exceed $20 million.
In addition to its three development projects, New Zealand Oil & Gas holds a range of other oil and gas prospects under licence in the offshore Taranaki, several of which are likely to be drilled in 2006. These include:
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