Wednesday, June 30, 2010

Thank God, deepwater oil drilling is safe in New Zealand, but then we do have different laws of physics and chemistry down under...



Anadarko presses ahead in NZ despite Gulf of Mexico mess

By Grant Bradley

NZ Herald Wednesday Jun 30, 2010

The Texas-based oil explorer that owns 25 per cent of the damaged well pouring crude into the Gulf of Mexico says its work programme in deep water off the New Zealand coast has not been affected.

Anadarko Petroleum must by late next month make a call on whether to drill off the South Island, targeting up to 500 million barrels of oil.

While protesters have focused on Petrobras, the Brazilian company which has up to five years to decide on drilling off the East Coast, drilling by Anadarko off Dunedin could start in summer.

South Island's Ngai Tahu said last night they hoped the Government would ensure proper procedure was followed and the utmost care taken to protect the environment when it came to oil exploration and oil drilling.

Te Runanga o Ngai Tahu general manager of tribal interests David O'Connell said the Ministry of Economic Development had in the past sought input on oil exploration around Stewart Island.

"It is our expectation that our views still have resonance today and we would not expect these places to be placed in jeopardy."

"The tragic events in the Gulf of Mexico...(have) not impacted on what the plans are in New Zealand"

When Anadarko announced it had formed a joint venture with Australia's Origin Energy in February, it said drilling could start early next year.

Anadarko spokesman John Christiansen said the company was excited about the potential in New Zealand.

"This is a great opportunity for us and it's one that we feel very blessed to have."

Anadarko has a non-operating stake in the Deepwater Horizon project but could face paying a share of the billions of dollars required to be spent in the Gulf of Mexico after the rig explosion on April 20 that killed 11 workers and has resulted in one of the world's worst oil spills.

Anadarko's debt rating has been downgraded, it is being sued by investors claiming it made false claims about drilling safety and could face an expensive legal battle with BP over liability for the clean-up.

Christiansen said the company would maintain its US$5.3 billion ($7.6 billion) to US$5.6 billion capital spending programme this year and because of the hold in drilling in the Gulf it was looking at concentrating on other areas.

"At this point in time the tragic events in the Gulf of Mexico have not impacted other areas of portfolio. We've looking at other places - it's not impacted on what the plans are in New Zealand."

Anadarko was still assessing a three-dimensional seismic survey recorded by Origin last year over the Carrack/Caravel prospect.

Christiansen said it was a little early to say whether the company would commit itself to drilling by August 21. If it does not, it must surrender the permit.

Anadarko is also part of a joint venture in the early stages of gathering and assessing a large prospect in deep water off the Taranaki coast.

Last weekend there were protests around the East Coast by groups alarmed at Petrobras drilling in deep water there.

While much of the drilling off Taranaki is in water 200m deep or less, deepwater drilling is classified as in water over 300m. The Canterbury Basin prospect was in water 1000m deep and the Deepwater Horizon rig was in water 1500m deep. Christiansen said Anadarko was well aware of the new concern about deepwater drilling.

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