Kupe gas to flow later than expected

Friday 12th June 2009

Raw gas from the Kupe field is likely to flow in the fourth quarter, later than expected, which may dent production totals at New Zealand Oil & Gas.

“We had previously presumed three calendar quarters of Kupe production in the 2009/10 financial year,” NZOG chief executive David Salisbury said “It is now likely that production during the December quarter will be reduced.”

Kupe is expected to meet about 15% of New Zealand’s annual gas demand over the next 15 to 20 years and about 50% of LPG demand – an estimated 254 petajoules of natural gas, 1.1 million tonnes of LPG and 14.7 million barrels of condensate .

The Kupe Project is 50% owned by Origin Energy which is the operator of the field. State-owned Genesis Energy owns 31%, NZOG owns 15% and Mitsui E&P Australia holds 4%.

“Construction of the offshore facilities wells, wellhead platform, pipeline and controls umbilical is complete, and the overall project including the production station near Hawera is nearing completion, with testing and pre-commissioning occurring later than planned,” said Andrew Stock, Origin’s general manager for major development projects.

“Capital costs for the Kupe project remain in line with previous expectations,” he said.

Shares of NZOG rose 0.6$ to $1.63 and have advanced 27% this year, helped by the rising price of crude oil, which traded above US$73 a barrel in New York yesterday.

Businesswire.co.nz

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