Maui partners nab rig to redrill Ruru prospect

Shell Exploration New Zealand, Todd Energy and Austria's OMV plan to use the Kan Tan IV oil rig next year to drill at least one, perhaps two, more exploration wells in the formerly giant Maui gasfield off Taranaki.

The rig will redrill Ruru-1 on the southeastern edge of the field, where drilling work was suspended because of wild weather off south Taranaki during April 2011.

Kiwi actress Lucy Lawless and other Greenpeace activists boarded the Noble Discoverer drillship at Port Taranaki to protest proposed Arctic drilling after the vessel had safely plugged and abandoned Ruru-1, which had been targeting up to one trillion cubic feet of bypassed gas, about a third of the original size of the field.

But the proposed well is a deeper exploration effort, centred on the middle of the field, targeting the same geological formation that flowed about 35 million barrels of crude oil over almost a decade to 2006.

"I can confirm that we will drill Ruru-2 with the Kan Tan IV," Shell's New Zealand exploration venture manager Roland Spuij told BusinessDesk.

Ruru-2 will target the geological Kapuni Formation C and D sands, from which the field has flowed since 1979.

"We have an option for a second well, deeper than existing production, but we still have to work it up and execute that option," Mr Spuij says. "It could be (targeting oil)."

Maui field operator Shell Todd Oil Services planned to use the semi-submersible rig after it had finished drilling campaigns for other joint ventures in and around the Maari-Manaia and Tui oilfields, he says.

The country's overall gas production rose by 8 percent during the March 2013 quarter to 47.9 Petajoules, according to the government's NZ Energy Quarterly publication. The majority of gasfields are decreasing production but Maui is the notable exception, given the success of the 2012 remedial drilling campaign from the Maui-B platform.

However, even though exports of crude oil and condensate (light oil) are still the country's fourth largest export earner, production and exports are at their lowest levels in six years.

Oil production in the December 2012 and March 2013 quarters was 3.05 million and 3.22 million barrels, respectively. So success in finding and producing further crude oil from Maui will help lift production back to the previous quarterly record of 5.62 million barrels.

Shell Exploration NZ owns 83.75 percent of Maui, Todd Energy 6.25 percent and OMV 10 percent.

(BusinessDesk)