Shares in New Zealand Oil & Gas, the Wellington-based oil explorer are climbing after the company hinted at a ''material'' upgrade in the size of Kupe, its principal field.
This morning the NZX-listed company said preliminary results from a reserves review of the gas and oil field by operator Origin Energy suggested its estimated reserves should be increased.
Kupe, which lies 30 kilometres off the Taranaki Coast, accounts for 70 per cent of NZOG's revenues and 90 per cent of its proven reserves.
Spokesman Chris Roberts would not discuss the scale of the possible increase, but said preliminary figures from Origin suggested a significant increase, leaving the NZOG concerned that it had to inform the market.
''We looked at these numbers, and if anything near to them are confirmed, it does have a material impact on our company value because Kupe is such a large part of our portfolio.''
Shares in NZOG, a member of the NZX-50, were up 3.2 per cent to 80 cents at 11:30am, the highest level in close to a year.
Kupe entered permanent production in March 2010. In July of that year Origin increased its estimate of the proved and probable reserves by around 12 per cent to 273 petajouls of sales gas, 1114 kilotonnes of LPG and 18.6 million barrels of light oil.
Origin, which holds a controlling stake in Contact Energy, is the operator of Kupe, with a 50 per cent share. The remainder is split between Genesis Energy (31 per cent) NZOG (15 per cent) and Mitsui (4 per cent).
- © Fairfax NZ News