Other than an unsuccessful one-hole drilling programme offshore from Oamaru in late 2006, all other exploration in the Great South Basin and Canterbury has been confined to about $100 million dollars worth of shipborne hydrographic surveys, before the permits were either dropped or deferred and some companies departed.
Not only do the two "frontier" basins have issues with potentially atrocious sea conditions, they are deep-water targets which pose technical difficulties. Deep-water exploration drilling is also now in the forefront of public and environmentalist concerns.
The latest round of tenders by Government permitting agency New Zealand Petroleum and Minerals (NZPM) opened in mid-June, with the offshore blocks around the country covering 40,198sq km of seabed, and onshore, 3305sq km of land in Waikato, Taranaki, Tasman, West Coast and Southland.
The level of interest so far is unknown and NZPM staff expect companies to lodge tenders closer to the October 15 deadline.
Last month, listed New Zealand Oil and Gas (NZOG) relinquished its permit to drill the Barque prospect off the coast at Oamaru, a week after Houston-based Anadarko deferred its separate drilling programme, estimated at $NZ124 million, in the same area at the Caravel and Carrack prospects until the summer of 2013, at the earliest.
NZOG, as operator and 40% stakeholder in the Barque permit, had to find partners to share the cost of drilling, which generally runs about $US1 million ($NZ1.255 million) per day, and had to make a "drill or drop [the permit]" decision a month ago, deciding to drop the permit almost three weeks before the deadline.
Anadarko and Shell have raised the possibility of sharing costs on an exploration rig, about the same time Anadarko confirmed it had a contract for a new ultradeep-water drilling ship, whose maiden voyage could be to New Zealand.
In the Great South Basin, there are four offshore blocks among the 23 onshore and offshore blocks put out to tender.
Previously permitted blocks in the frontier Great South Basin in 2007 attracted oil giants Shell, OMV and Exxon, but the latter departed about 20 months ago.
A Shell and OMV joint venture could take up to two years to decide on whether to test-drill.
