Kahu-1 well disappoints, NZ Oil & Gas shares fall

Kahu-1 well disappoints, NZ Oil & Gas shares fall

July 19 (BusinessDesk) - The second exploration well of a two-well programme in the highly prospective Tui oil and gas zone has come up without finding significant evidence of hydrocarbons, 12.5% field owner New Zealand Oil & Gas Ltd told the NZX this morning.

NZOG shares fell 2.4% on the news to $1.22, and had been falling since an announcement last Friday that the well was close to target depth, but which made no mention of hydrocarbon shows.

Operator and 42.5% owner AWE announced it had plugged and abandoned the Kahu-1 exploration well, having acquired wireline logs after reaching a depth of 3835 metres. "No significant hydrocarbons were detected within the target sandstone reservoirs," said AWE.

The Kahu-1 well was an exploration well within PMP 38158, located approximately 3 kilometres east of the producing Tui Oil Fields.

High hopes were held for both the Tui SW-2 and Kahu-1 wells, given their proximity to the producing Tui oil field, but instead the programme has made no significant discoveries while accruing substantial additional costs after problems with casing forced abandonment of the Tui SW-1 and the drilling nearby of the unscheduled Tui SW-2 well.

(BusinessDesk)

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