Fifteen new oil and gas exploration permits have been awarded around the country, amounting to a $110 million undertaking for initial exploration work.
There were no new southern permits issued for the Great South Basin or the Canterbury Basin, but shipborne seismic surveying work is still to be undertaken in those basins by Anadarko, New Zealand Oil & Gas and Schlumberger, the earliest possibly starting during late summer.
Energy and Resources Minister Simon Bridges announced the six onshore and nine offshore permits yesterday, the latter across the Reinga-Northland, Taranaki, and Pegasus (Wairarapa) basins.
''Collectively, the permits represent more than $110 million in committed expenditure on initial exploration which, if successful, could lead to further work worth more than $1 billion,'' Mr Bridges said in a statement.
He said the annual block offer had attracted three new companies to explore, and there was expanded interest from local and international companies already operating in New Zealand.
''The results show New Zealand continues to cement its reputation as a key destination for investors in oil and gas exploration,'' Mr Bridges said.
The two major overseas companies are Chevron, in a joint venture with Norwegian state-owned Statoil, and ONGC Videsh, controlled by the Indian Government.
Petroleum Exploration and Production Association of New Zealand chief executive Cameron Madgwick said the permit allocation brought new companies, new opportunities and new investment to New Zealand.
''New Zealand holds a vast amount of petroleum potential.
''We need to use our petroleum potential today, so we can grow our economy [and] invest in more energy options and public services tomorrow,'' Mr Madgwick said.
The oil and gas industry was already New Zealand's fourth-largest exporter and employed more than 7000 people, he said.
World oil prices have fallen more than 30% since June as global consumption has grown very slowly, while production has jumped, AFP reported.
Output of oil and gas from shale and other unconventional deposits in North America has been a major contributor to the global glut.
Confirmation of the New Zealand permits arrives amid the lowest global oil prices in about five years.
Reuters reported Brent, North Sea, crude oil fell more than $US2 a barrel on Monday to a five-year low on predictions oversupply would keep building until next year after the Middle East cartel, the Organisation of Petroleum Exporting Countries (Opec), decided not to cut output.
In a report from last Friday, Morgan Stanley said oil prices could fall to as low as $US43 a barrel next year.
''Without Opec intervention, markets risk becoming unbalanced, with peak oversupply likely in the second quarter of 2015,'' Morgan Stanley analyst Adam Longson said.
Brent for January was down $US1.77 at $US67.30 a barrel while West Texas Intermediate was down $1.44 at $64.40 a barrel, having touched $63.72 last week, its lowest since July 2009.
ConocoPhillips, one of the United States' largest exploration and production companies, announced a sharp cut in spending on exploration as oil prices continued to push down.
The company set capital spending in 2015 at $US13.5 billion, about 20% below 2014.
Development drilling spending will fall 23%, to $US5 billion.
The company said the reduction reflected lower spending on major projects which were near completion and spending deferral on ''unconventional plays'' in North America.
These were generally shale deposits which entailed more expensive production and were potentially unprofitable with the low oil prices, ConocoPhillips chairman and chief executive Ryan Lance, said in a statement.
''We are setting our 2015 capital budget at a level that we believe is prudent given the current environment,'' Mr Lance said.
Permits
Oil and gas exploration permits awarded to.-
• Chevron NZ Exploration (new): Three offshore Pegasus permits (joint venture with Statoil Lambda Netherlands BV).
• Statoil Lambda Netherlands BV: One offshore Northland-Reinga permit.
• ONGC Videsh (new): One offshore Taranaki permit.
• New Endeavour Resources (new): One offshore Taranaki permit.
• OMV New Zealand: One offshore Taranaki permit, one offshore Pegasus permit.
• Todd Exploration & Beach Petroleum: One offshore Taranaki permit.
• Mosman Oil & Gas NZ: One onshore East Coast permit and two onshore West Coast permits.
• TAG Oil NZ: Two onshore Taranaki permits.
• Petrochem: One onshore Taranaki permit.
SOURCE: NEW ZEALANDPETROLEUM & MINERALS
