Brazilian oil giant Petrobras has abandoned its efforts to
explore the Raukumara Basin for oil and gas.
The move appearts to be a reaction to a string of
difficulties which have seen the oil giant report losses for
the first time in 13 years.
Prime Minister John Key told The New Zealand Herald that the
decision was "not a reflection on the capacity to undertake
deep-sea drilling or the prospect of activity of that area."
The Raukumara Basin lies in very deep water off the east
coast of the North Island and has barely been explored.
Petrobras contracted a seismic survey ship to undertake
initial surveys of parts of the basin early last year, where
it encountered stiff opposition from a protest flotilla
organised by Greenpeace and a local Maori tribe, Te Whanau a
The New Zealand Navy was despatched to ensure the seismic
survey could continue.
Petrobras has had what the Financial Times newspaper
described early last month as an "annus horribilis",
reporting its first quarterly loss in 13 years in the second
quarter, disappointing investors in the third quarter, and
facing a 40 per cent plunge in its share price over the year.
Among its difficulties have been falling production, foreign
currency losses caused by the need to import fuel owing to a
lack of refining capacity in Brazil, government interference,
and most recently an order to pay back taxes of US$2.4
billion dating back a decade, relating to offshore
Key said he understood Petrobras was "going through a bit of
a regrouping phase and they're stepping back from what
they're doing. I don't think it has got anything to do with
the capacity to do the mining activity they were looking at
"I think it's the context of their local and domestic issues
they're dealing with" and should not be seen as a blow to the
government's agenda for accelerating economic growth through
oil and gas discoveries.
"I wouldn't really put it in those terms. That's a long-term
project and opportunity out there. There are plenty of other
people looking at lots of other options in the Canterbury
Basin and the likes."
Key did not believe the court challenge from Greenpeace or Te
Whanau a Apanui played any role in the decision.