19 Nov 2013

Tag Oil argues it shouldn't pay road cost

6:11 am on 19 November 2013

A Canadian-owned oil and gas company says it will pull out of a proposed well site if it has to pay up to $1 million upfront for a road upgrade.

Tag Oil plans to drill six wells off Cross Road near Stratford in central Taranaki.

The Stratford District Council has appointed a commissioner, Greg Carlyon, to decide on the application which is being opposed by neighbours concerned about noise, vibration and heavy traffic.

Tag's New Zealand manager Randy Toone says the council's recommendation for a full road upgrade costing between $800,000 and $1 million before the wellsite construction is overkill.

The company says it will pay for the full upgrade if it strikes oil and gas and the well becomes economically viable. It says it is prepared to pay $140,000 to initially maintain the road.