"The energy sector faces major challenges over the next few years. New Zealand needs new discoveries of oil and gas through continuing exploration.
"The expected early depletion of the Maui gas field is changing New Zealand's gas market. This changing market, coupled with the Taranaki basin's proximity to production infrastructure, pipelines, power stations and markets, will attract explorers attention to the current bidding round. Increasing wellhead prices for new gas finds is also stimulating more interest in gas exploration.
"Petroleum explorers are showing more interest than ever in New Zealand as an international exploration destination. New Zealand is now the 13th most attractive country in the world for petroleum investment, according to the latest 2003 international survey by the IHS Energy Group. New Zealandís standing has risen from 36th place in 1999 to its current highest level.
"The Government has responded to this interest by issuing a large number of petroleum exploration permits. There are now 86 exploration and mining permits on issue with 8 more applications pending. Two years ago there were just 58 permits issued" Mr. Duynhoven said.
Applications for the nine offshore and eight onshore blocks on offer close on October 31, 2003.
There are eight onshore blocks in the new bidding round, covering a total area of 590 sq km, or 146,000 acres. The blocks to the east are near the Tarata thrust zone which contains the TAWN gas-condensate and oil fields. To the west other onshore blocks are located adjacent to fields containing productive Kapuni Group sandstones and Miocene turbidites. The bidding round continues the trend of making onshore Taranaki acreage promptly available to explorers by competitive block offers.
The nine offshore blocks, are bounded to the south by the Pohokura gas-condensate discovery now under development near New Plymouth, the Tui-1 oil discovery to the southwest, and the Karewa-1 hydrocarbon discovery immediately to the north of the blocks on offer.
In addition, the Kora oil discovery is located near the centre of the offshore blocks. At the time of its discovery Kora proved uneconomic to develop. Significant hydrocarbon shows have also been found at other wells in the area.
The offshore blocks, which cover an area of 12,180 sq km, or 3 million acres, lie on the continental shelf with water depth largely between 50 meters and 200 meters. The area of a separate Deepwater Taranaki Basin bidding round lies immediately to the northwest of the new bidding round. Applications for the deepwater round bids close on September 30, 2003.
The Government is also holding permit bidding rounds over the Canterbury Basin (closing on May 30, 2003) and the Deepwater Taranaki Basin, while the offshore Northland Basin has been set aside for a bidding round in late 2003 or early 2004.
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