NEARLY two weeks after breaking ground, petroleum exploration company TAG Oil is now about a third of the way through drilling its first exploratory well in this region.
After three months of site works, the Taranaki-based company spudded in its Waitangi-1 well last Wednesday at Waitangi Terrace Station, just over 20 kilometres inland from Te Karaka.
Using Wellington-based contractors Webster Oil and Drilling, TAG plans to drill to a depth of 3600 metres, targeting naturally-fractured Waipawa black shale and Whangai source rock formations.
By Friday, they had already reached 850 metres and progress was steady. They predicted that would slow as they reached rock caps deep underground.
The company’s first well in the Gisborne region is its second in the East Coast Basin area that extends over about 120,000 square kilometres, on and off shore, from the East Cape of the North Island to Marlborough in the south.
The first was the 1800m Ngapaeruru-1 well, near Dannevirke, which was spudded in during April of last year.
TAG will analyse results from both exploratory wells to determine the likelihood of either site being suitable for the production of oil and/or gas.
The company has experienced some opposition to its plans to explore in the region but says the consent process imposed by Gisborne District Council was the most rigorous it has been through.
Council staff are conducting regular site visits to ensure all conditions of consent are being met.
Working on 12-hour rotations, staff stay on site for their two or three-week shifts, travelling to Gisborne only to fly out to home towns around the country for periods of down time.
This helps meet stringent safety regulations as well as keeping the number of traffic movements down, says company spokesman Chris Wikaira.
Overseen by TAG site representatives, the Webster team is charged with steadily and safely guiding their Nova 1 rig through the 30 to 40-day drill.
Another contractor, Chain Resources (New Plymouth), takes care of security and safety. Programmed Integrated Resources (also New Plymouth) runs the on-site camp. Gisborne’s Downer EDI Works is in charge of roading and access and Webster has contracted a couple of local workers to provide general labour as leasehands.
Having a small well pad nestled into the hills helps TAG ensure its footprint on the landscape is small and the site will be fully rehabilitated, says Mr Wikaira.
But they will leave something behind, he says.
“The seismic surveying they did identified every tiny fault in the area and that information goes to GNS to help with earthquake monitoring work.”
Waitangi Valley-1 is taking more than $5 million of the $21.7m TAG has committed for drilling and testing wells in the East Coast Basin, with the balance to be spent back at Ngapaeruru-1 and at Boar Hill-1, also in Hawke’s Bay.
Believing there is an oil resource to the tune of millions of barrels in the basin, TAG says it is most likely to find “unconventional” oils (held in sources like oil sands, oil shale and tight sands) rather than “conventional” oils (held in underground reservoirs).
However, as the land around Waitangi Valley-1 is known for its oil seeps, the new well “also includes possible conventional discovery potential, as we drill through a number of Miocene-age sands similar to what we produce from in Taranaki”.