Methanex aims to join NZ's gas exploration project

Methanol producer Methanex plans to get involved in the gas exploration industry in New Zealand.

The company, which has methanol plants at Motunui and Waitara Valley, will fund an exploration well called Beluga-1, which will be drilled to the west of the Waitara River near Tarata and will target deep gas.

Drilling will be done by Kea Petroleum, a firm headed by prominent New Zealand energy industry man Dave Bennett, which this month raised $13.3 million for the exploration project.

Information contained in the Kea Petroleum website said it had entered into an agreement with Methanex, under which the methanol company will fund the drilling of Beluga-1 in return for Kea granting certain rights to Methanex to buy any gas discovered and share in the profits from development of the Beluga prospect.

"The directors believe the Beluga prospect is potentially of a large enough scale to be capable of fully supplying the gas demand of Methanex's New Zealand operations," it said, adding that production could potentially exceed 30 million cubic feet of gas and 2000 barrels of condensate a day.

"Beluga's best estimate prospective resources are 446 billion cubic feet of gas, with a condensate yield of about 27 million barrels.

"This is comparable in size to the adjacent Mangahewa and Pohokura gas fields, where production is obtained from similar depths."

Before Beluga-1, Kea Petroleum will drill the Wingrove-2 appraisal well, targeting oil prospects in a neighbouring exploration licence area near Stratford.

This well, to be drilled from this month, will be a deviated well designed to test the potential of the good shows experienced in a previously drilled Wingrove-1 well.

Kea said that in the event of successful oil production at Wingrove-2, several offset wells could be drilled this year without further pre-drilling evaluation, to target the same reservoir sands and increase production and reserves. Taranaki Daily News

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