Oil explorer granted extension

Plans for oil exploration in the south have again been put on hold.

Crown Minerals has given the OMV-led international exploration giant another year to decide whether to drill for oil and gas in the Great South Basin, with its deadline extended to July 2011.

The extension comes just three months after Crown Minerals gave a second exploration giant, ExxonMobil, another year to decide if it would drill in the basin.

Asked yesterday why the company needed a time extension, OMV communications spokesman Chris Wakaira said: "Basically, everything took longer last year than expected."

The drilling decision would ultimately depend on the results of seismic and other geological data still being evaluated by the company, he said.

The seismic research ship Bergen Resolution this week began gathering more data in the Great South Basin for OMV, with the crew, which changed over in Dunedin, expected to complete its work in a month.

If OMV decided to drill it would would occur in the following year after the decision was made, with five wells to be drilled if it decided to go ahead with all three permits.

Invercargill Mayor Tim Shadbolt did not return calls yesterday, while deputy mayor Neil Boniface said he was not concerned by the delay.

"We were a bit disappointed when ExxonMobil was delayed by a year, but you can't rush these things. I think they will still be coming. If they weren't coming they wouldn't be asking for an extension of time, would they."

Planning for the oil and gas exploration had started in Southland, but lots of work was still required, he said.

Southland Energy Consortium chairman Mark O'Connor said he didn't view the 12-month delay as a discouraging sign.

"Obviously they aren't going to make a decision until they get to the other end of their planning," he said. "We still remain reasonably optimistic there's a prospect for exploration within the next two to three years."

A spokesman for Energy Minister Gerry Brownlee said OMV had made a good case for its time extension so it could complete its exploration programme.

"The potential for the Great South Basin has been talked about for 40 years, so in that context we didn't think another year seemed unreasonable," he said.

- © Fairfax NZ News

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