Interest in searching for and finding commercial fields in New Zealand will return despite prices sitting at near 11-year lows, according to a group representing the oil and gas exploration industry.
The government has just awarded nine permits for onshore and offshore exploration, compared with 15 permits last year, and the value of the work to be done is $4.4 million against last year's $110 million.
The areas to be explored are all in Taranaki, the country's only commercially producing region, and there was no interest in deep-sea frontier areas such as the Great South Basin.
Only four companies won permits to search, including the Austrian firm OMV and Todd Exploration, but well-known industry players such as Anadarko, Shell and NZ Oil and Gas were notably missing.
Low oil prices were making companies reluctant to spend on exploration, but cyclical factors would affect the sector and interest would rise again, Petroleum Exploration and Production Association chief executive Cameron Madgwick said.
"There will be a commodity cycle which will turn at some point, and we would expect the interest in the sector from the large international players will match that cycle," Mr Madgwick said.