Swift Energy Increases Interest in Tuihu Permit
Swift Energy New Zealand has reached agreement to acquire an additional 50% interest in Petroleum Exploration Permit 38718, covering 28,553 acres, from Shell New Zealand through an existing pre-emptive right under the joint operating agreement. Following the transaction, SENZ will sell a 20% interest in the permit to a subsidiary of New Zealand Oil and Gas. The purchase and subsequent sale, which are subject to certain government notifications, approvals and consents, will result in SENZ holding a 50% working interest in the permit. SENZ has also been named operator of the permit effective December 1, 2002.
At a recent meeting of the partners holding interests in this permit, the 2003 work plan was approved for the exploration permit. The work program consists of the re-entry of the Tuihu #1 exploration well, which was drilled to a depth of 14,858 feet in 2001 by Fletcher Challenge Energy. The Company's interest in the well at that time was 20%. This re-entry will attempt to sidetrack and deepen the original well to the deeper targeted objectives. The well as originally drilled did not reach the identified seismic anomalies seen at these deeper intervals. Drilling was terminated as the well costs reached the total level that was authorized for expenditure. This activity is planned as part of the Company's 2003 budget in New Zealand.
Terry Swift, president and CEO of Swift Energy, commented that, "It is our belief that the Tuihu #1 well was not drilled deep enough to reach the objective - the Kapuni and Tariki sands. Swift will either side track this well, or drill another well, depending on the condition of the well bore to reach the targeted objectives in the well and meet the work commitment to the New Zealand government for the permit in the 2003 permit year."