The companies hoping to drill for oil and gas in central Hawke's Bay say the initial testing has been encouraging.
On Wednesday the companies briefed a public hearing held by Hawke's Bay Regional Council on their operations around the coastal settlement of Porangahau, near Dannevirke.
About 200 anti-oil protesters were at the hearing.
The search is being mounted by Tag Oil and its partner, Apache Canada.
They told councillors there has already been seismic testing, in which echoes from explosive devices gives a clue about what sort of geology is found underground.
As a result they plan to drill an exploratory well this year, and if it proves economically viable will launch commercial production.
Separate resource consents would be needed for both stages.
There have been similar developments north of Gisborne, where oil sometimes seeps out of the ground into farmers' paddocks.
