NZ Energy gets money's worth out of old oil wells

Surprise success is being achieved by an oil exploration company that has re-opened veteran oil wells in central Taranaki.

Canada-headquartered New Zealand Energy Corporation has begun reactivating wells in the Tariki, Waihapa and Ngaere oil fields that it recently bought off Australian company Origin Energy for $41.8 million. The success has been immediate.

The company says more than 5500 barrels of crude has flowed from just two of the six re- opened wells so far. John Proust, CEO of NZEC, said the amount had "exceeded expectations".

All six were able to use the gas lift process, where gas was injected to encourage fluid in the well to head to the surface, though oil was reported to be flowing out of four wells using natural formation pressure.

The company said it planned to install electric submersible pumps into two of the wells to increase production.

The six wells are in a expansive area that covers part of Taranaki's main oil and gas production "fairway," which runs east of and parallel to State Highway 3 between Inglewood and Stratford.

The Waihapa production station, near Stratford, was also bought in June this year.

It is processing oil from the wells before it is piped to the Omata tank farm and sold at Brent pricing.

Natural gas produced by the wells (a total of 6.9 million cubic feet so far) is sold to Contact Energy.

The fields were discovered in 1986 and 1988.

They once produced a good supply of crude oil, natural gas and LPG.

They had been drilled to the Tikorangi formation by previous operators and produced intermittently but had been effectively shut down for a number of years.

The company said additional wells had uphole potential from the Mt Messenger formation, which had been confirmed by pressure surveys.

Uphole well exploration would begin before the end of the year.

Taranaki Daily News