Anadarko drops North Island offshore oil prospect

  • 09/12/2016

Texas-based oil and gas explorer and producer Andarko has joined a string of other oil majors in dropping an exploration licence in lightly explored offshore areas of New Zealand.

Anadarko has dropped its prospecting licence in the Pegasus Basin, offshore east coast of the lower North Island.

It is, however, continuing to reprocess seismic survey information from its Canterbury Basin prospect, where it is seeking a delay from the government on its drilling programme.

Instead of drilling next year, Anadarko wants to be allowed to wait until January 2018 before making a decision whether or not to drill one or more exploratory wells in deep water off the Canterbury coast.

Anadarko drops North Island offshore oil prospect

A map of the New Caledonia Basin off the west coast of the North Island (Shell New Zealand)

Anadarko also holds a 25 percent interest in a prospecting licence in the frontier New Caledonia Basin, which is operated by Shell New Zealand, which has been in the process of reviewing all its New Zealand operations for sale as the Dutch-based multi-national seeks to reduce costs around the globe.

Anadarko had previously quit a deep water Taranaki Basin prospect, where exploratory drilling failed to turn up commercially viable oil or gas deposits.

Since the explosion of onshore shale oil and gas production in the United States helped collapse the global price of oil, previous interest by global oil companies in deep water oil exploration has been waning.

That has been spurred further by the costs and negative global publicity of the Deepwater Horizon deep water rig explosion in the Gulf of Mexico in April 2010, in which Andarko was a financial partner.

Brazilian firm Petrobras, Norwegian explorer/producer Statoil and Mobil have all abandoned prospects in the last couple of years.

Environmental groups hailed the withdrawal.

"They're dropping like flies," said Greenpeace climate change campaigner Steve Abel.

"One of the supposed cornerstones of this Government's economic strategy is its oil programme, but it is totally failing with no new oil found in eight years of searching."

An Anadarko spokesman, Alan Seay, said: "We remain committed to New Zealand."