Greymouth Makes Discovery with Turangi-1

Greymouth Petroleum reports that the Turangi-1 well, drilled in 2005 in Permit PEP 38762 on the North Taranaki peninsular, discovered the Turangi Gas Condensate Field. Turangi encountered multiple Kapuni group sands. Well testing has confirmed the discovery of a sizeable condensate rich gas field.

Works for the Turangi Field development are well advanced and the commissioning of gas export now awaits interconnections to the open access gas trunklines and finalising condensate offtake arrangements. Greymouth expects to be exporting specification gas in May, 2006 at initial delivery rates of 10 TJ/d. Contracting with interested gas purchasers will be finalised when a firm gas delivery date has been established.

Planning for long term field development will progress following today’s award of Petroleum Mining Permit (PMP) 38161. Information gathered during the initial production phase will assist to determine the feasibility of long term gas cycling in the richer sand sequences. The Turangi development will involve the co-development of Ohanga area gas, discovered by earlier wells in PEP 38762. Independent petroleum engineering reserves assessments have predicted proven and probable petroleum reserves of 154 Petajoules of gas and 5.10 Million barrels of condensate are producible from the Turangi and Ohanga areas of PMP 38161.

John Sturgess, Greymouth's Chief Operating Officer said; "We are delighted with the results of Turangi-1. It confirms that material hydrocarbon reserves can be identified by New Zealand owned and operated oil and gas explorers. Discovery of these gas reserves increases the potential for further sizeable NZ gas finds and reduces the prospect that New Zealand will need to import gas from overseas.” Turangi development planning has been “fast tracked” by Greymouth so that PMP 38161 gas reserves can be made available to maintain fairly priced fuel supplies to residential and backbone NZ gas users in the health care, dairying, meat processing, timber processing, petrochemical and power generation sectors. Greymouth particularly wants to ensure that Turangi gas is on line to meet any gas market shortage which will arise if there are delays with other planned gas field developments.