Trading in New Zealand Oil and Gas shares has resumed after a brief halt earlier today.
NZOG said it believed its share price had been affected by its announcement on Tuesday that the primary target zone in the Matuku well had not encountered significant oil or gas shows.
The well is currently at a depth of 4307 metres and drilling is continuing to a total depth of 4750 metres, the company said.
"Until drilling is complete and testing analysed, geologists have not formed a complete view about the well or the implications for the play type in the Kahurangi trough, which was thought to be a source kitchen for a success case at Matuku," NZOG said.
NZOG chief executive Andrew Knight said a negative result in any well is always much more likely than a positive result.
"Most wells will not make commercial discoveries of oil and gas. Our company explores a portfolio of prospects in order to balance the investment risks around individual wells. In the near future, New Zealand Oil & Gas is involved in drilling in the Tui permit at Pateke and Oi, and next summer in the Kaheru prospect off South Taranaki."
Participants in the exploration permit which includes Matuku-1, PEP 51906, are OMV New Zealand, which holds a 65 per cent share, Octanex with 22.5 per cent and NZOG with 12.5 per cent.
If Matuku-1 is successful, either NZOG or Octanex may exercise an option for NZOG to acquire a further 5 per cent of Octanex's share, which would equalise each company's interest at 17.5 per cent.
- Fairfax Media