Shell to drill off Dunedin coast

Click on map to enlarge
Click on map to enlarge
Shell is to drill for gas and oil in the Great South Basin off the coast of Dunedin.

Great South Basin joint-venture parties Shell New Zealand, OMV New Zealand and Mitsui E&P Australia will drill an exploration well in the PEP 50119 block (see map).

The western edge of the permit area is about 100km off Dunedin and it stretches down to the south west of Stewart Island and the area borders a marine mammal sanctuary off the the Catlins in Southland. 

The drilling programme will most likely target the early 2016 summer period.

Environmental protesters disrupted a Dunedin meeting to discuss the plans last year and today's announcement comes amid Greenpeace protest at deep water exploration well being drilled by American explorer Anadarko off the Taranaki coast.

Drilling an exploratory well could cost up to $200 million and would follow seismic surveys of the wider basin costing close to $100 million. Shell New Zealand is the operator in the joint venture and its partners are OMV NZ and Mitsui E&P Australia.

Explorers have targeted the Great South Basin in the past with eight wells were drilled between 1976 and 1984, and hydrocarbons recorded in four.

However, at the time water depth and the isolation made gas reserves in one well "non-commercial" and mechanical problems meant that strong oil shows in another were not properly tested.

In 2007 an earthquake brought traces of crude oil to the surface on Stewart Island.

"We are very grateful to the communities of Otago and Southland for the way in which they have engaged with us so far,'' Shell country chairman Rob Jager said.

"We will ensure that open and honest engagement with all interested parties continues as the project matures towards the drilling campaign.''

- Full story tomorrow's ODT



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