Report Shows Maari Field Reserves at 55 Million Barrels

The Maari oil field in offshore New Zealand, scheduled to begin oil production in early 2006, has estimated reserves of 55 million barrels of oil, according to a report commissioned for one of the Maari joint venture partners Sydney-based Horizon Oil NL.

Horizon Oil says the report confirmed the robust economics and significant value of the Maari field in the PEP 38413 permit which is operated by Austrian-owned OMV New Zealand Ltd.

The report by Perth-based Resource Investment Strategy Consultants (RISC) says the P50 (proved plus probable) reserve estimate for the Maari field was 49 MMbbl with the outlying Manaia field having a P50 reserve estimate of 6 MMbbl.

RISC said it had recalculated the likely recoverable reserves for Maari from the Moki and Mangahewa reservoirs, plus the M2A sands.

The report estimated Horizon Oil's net production entitlements for its 10% interest in the permit at between 2.6 and 9.5 million barrels of oil, with a medium case of 5.0 million barrels. The net present value (NPV) was $A8.2 million to $A78.8 million, with a medium value of $A35.3 million at an 11% discount rate.

The most promising development options were a minimum facilities platform, with surface wellheads connected to an FPSO or subsea wells tied back to an FPSO. Long horizontal or multilateral wells are preferred.

RISC estimated the total cost for PEP 38413 development to be between $US241.6 million and $US412.4 million spread over 11 years, depending on the chosen development scenario.

A final investment decision on the development was likely in the second quarter of 2004 with first oil in the first quarter 2006.d

The Maari and Manaia structures are simple dip-closed anticlines at all reservoir levels. Maari is located approximately 35 km south of the Maui field in a water depth of approximately 100 m.

OMV New Zealand Ltd holds a 69% interest in the permit, Todd Petroleum Mining Company Ltd 16%, Horizon Oil 10%, and Delta Oil Taranaki Pty Ltd 5%. OMV last year acquired Shell's 49% stake in Maari.
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