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New Zealand’s Oil Reserves Jump 53% on Tui, Pohokura (Update2)




New Zealand’s Oil Reserves Jump 53% on Tui, Pohokura (Update2) 

By Gavin Evans

July 2 (Bloomberg) — New Zealand’s oil and condensate reserves jumped 53 percent last year, buoyed by the development of the nation’s offshore Tui oil field and completion of Royal Dutch Shell Plc’s Pohokura project.

Remaining reserves in the country’s producing oil fields rose to 148.3 million barrels at Jan. 1, from 97.1 million barrels a year earlier, according to theMinistry of Economic Development. Gas reserves climbed 10 percent to 2.03 trillion cubic feet, the ministry said today in an annual review.

Exploration surged in New Zealand the past three years as a shortage of natural gas prompted the government to open its gas and oil-bearing basins to international companies. A record 42 wells were drilled last year and oil is now the nation’s third- largest export earner after dairy and meat products.

“The numbers on the face of it seem quite encouraging,” said Chris Stone, executive director of investment bank Rockpoint Corporate Finance Ltd. “That suggests there’s quite a few years of gas left,” he said in a telephone interview from Auckland. Delivery rates from older fields remain “a big issue,” he said.

New Zealand, a nation of 4.3 million, used about 31.5 million barrels of oil last year. It produced 14.9 million barrels of oil in 2007, the most since 1998, and about 170 billion cubic feet of gas.

Tui, Pohokura

The producing field reserve estimates exclude gas and oil held in projects being planned or in development. Including Origin Energy Ltd.’s NZ$1 billion ($760 million) Kupe gas project and OMV AG’s offshore Maari oil project, oil reserves rose 12 percent to 217 million barrels and gas reserves 17 percent to 2.41 trillion cubic feet.

Tui started production a year ago and was the nation’s first offshore oil development since 1996. It accounted for about 35 million barrels of the increase in oil reserves. Its total reserves have since been upgraded to 50.1 million barrels by operator Australian Worldwide Exploration Ltd.

Reserves remaining in the offshore Pohokura field, owned by Shell, OMV and Wellington-based Todd Energy Ltd. and completed in May, increased 30 percent to 55.9 million barrels. Liquid reserves in the partners’ Maui field rose 9 percent to 24.1 million barrels.

Increased gas reserves were driven by a 16 percent gain at Pohokura to 908 billion feet and a 13 percent improvement at Maui to 439 billion feet. Gains at Todd’s Mangahewa field and other smaller fields also contributed.

To contact the reporter on this story: Gavin Evans in Wellington at[email protected]

Last Updated: July 1, 2008 23:17 EDT

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