The Government has awarded 10 oil and gas exploration permits to international and domestic companies. They were awarded to international and domestic companies including TAG Oil, Todd Exploration and New Zealand Oil & Gas.
Seven of the permits awarded are in the Taranaki Basin, New Zealand's only oil or gas producing basin. US- based oil giant Anadarko was given two permits in the previously unexplored Pegasus Basin. Shell, OMV and Mitsui received a joint permit in the Great South Basin.
The five-year permits are split equally between onshore and offshore blocks.
The Government says the permits have a collective work programme spend of $82 million and, if initial work is successful, a further $776 million could be spent within the five years.
Initially, 25 blocks were on offer, but Energy and Resources Minister Phil Heatley said it was unrealistic to expect companies to bid for many different fields in New Zealand.
Anadarko could spend up to $US100m
One of the larger international energy explorers, Anadarko, says it may spend up to $US100 million if it gets to the point of drilling a well in the Pegasus Basin.
Anadarko is already exploring parts of offshore New Zealand, and Asia Pacific exploration manager John Gordon says the Basin is a gamble, but the data indicates there is something there.
"Frontier basins, they're all obviously interesting to proceed with an exploration programme. We see great potential, but it is in fact frontier, still."
Shell is part of a consortium for the deep water Great South Basin, off the coast of Otago. Chief executive in New Zealand Rob Jager says its new permit is next to its existing licence.
He says the permit is an extension of Shell's existing activities, so if it's successful it will provide new opportunities.
Mr Jager says the company has not yet decided when it will drill new wells, but it will not be before the summer of 2014 - 2015.
In the Taranaki Basin, the successful firms included New Zealand's Todd Exploration and New Zealand Oil & Gas, along with Canada's TAG Oil.
New Zealand Oil & Gas won two blocks, including one as a minority partner with the Vancouver-headquarter firm New Zealand Energy Corporation.
Its chief executive John Proust says it's focused on onshore Taranaki where it is the largest exploration permit holder and it's vital to look at quality not quantity acreage.
Petroleum exploration permits for 2012:
- Anadarko: two permits in the Pegasus Basin
- Shell, OMV and Mitsui: one permit in the Great South Basin
- Todd Exploration and Cue Taranaki: one offshore Taranaki Basin permit
- New Zealand Oil & Gas: one offshore Taranaki permit
- Cheal Petroleum and East West Petroleum: three onshore Taranaki permits
- TAG Oil: one onshore Taranaki permit
- New Zealand Energy Corporation and New Zealand Oil & Gas: one onshore Taranaki permit.