Westech to Redrill East Coast Kauhauroa Gas Discovery Structure

Denver-based Westech Energy is set to begin drilling the first well in a multi-well program near the onshore East Coast Basin 1998 gas discovery Kauhauroa-1 near Wairoa in New Zealand.

Westech's parent company Energy Corporation America, business development Vice-President Denny McGowan said from Denver that the company planned to spud the Waitahora-1 well in a re-test of the Kauharoa structure.

Mr McGowan said the Ensign Rig 19 was expected to spud around 26 March for about a two-week well.

The Kauhauroa discovery well flowed gas from a highly over-pressured formation.

He said Westech now believed that with the added knowledge gained from drilling other wells both onshore and offshore East Coast plus some new drilling and completion techniques, the company would be able to better drill the structure.

Gas prices have also risen substantially in the intervening period. "We believe we can now figure out a way of getting an economic return for the gas."

Westech would be looking at the possible use of gas for generating electricity and would also be talking to other potential industrial consumers in the area.

A second well is planned in the third year of the 5,582 sq km PEP 38346 probably to drill the flank of the structure to investigate whether there is better sands development there. A third well is planned for the fifth year.

Mr McGowan said Westech had also surrendered its two offshore East Coast permits off the Wairarapa coast. He said the company may later go offshore again on the East Coast but for now it wanted to concentrate on its onshore permit.

He said Westech has also become operator of the offshore Taranaki permit PEP 38491 and was currently negotiating to secure an offshore rig this year for a well. Westech has increased its holdings from 20% to 33.33% following the withdrawal of Transworld and Bridge Petroleum from the permit. Mighty River Power now holds 66.66% of the permit.