Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


US company, Apache, pulls out of East Coast oil hunt

US company, Apache, pulls out of East Coast oil hunt

By Pattrick Smellie

Jan 15 (BusinessDesk) - The government's drive for new investment in oil and gas development in New Zealand has suffered another blow with the departure of Texan mid-sized player Apache Corp from a joint venture with Canadian TAG Oil.
The pair were to explore together for oil and gas on the North Island's East Coast. TAG says it will now go it alone.

The shale gas play is likely to involve the controversial practice of hydraulic fracturing, or "fracking", to which the Parliamentary Commissioner for the Environment last year gave a partial clean bill of health, subject to robust regulation.

A groundswell of local opposition to the exploration has been building in the region.

Unlike the Taranaki region on the west coast of the island, the east has no previous experience of oil and gas exploration. TAG is already actively producing oil and gas from numerous onshore wells in Taranaki, has engaged in some fracking to do so, and won more permits in Taranaki in a government tender round late last year.

"We are a large company and we have opportunities all over the world," an Apache senior vice-president for global corporate affairs, Bob Dye, told BusinessDesk from from Houston. "We reviewed where we are at and decided to invest our money elsewhere."

Exploration activity has been progressing, including exploration areas around Gisborne and Hawke's Bay sporting signs saying 'This is Apache Country'.
"We wish TAG all the best," said Dye. "They are a good company to work with but we decided to reallocate."

The Apache website cites no more than a commitment to "evaluate potential well performance for an oil shale project in New Zealand."

The decision, typical of oil companies with global reach and a constantly evolving portfolio of possible investments, follows a decision announced last month by the Brazilian oil and gas giant to relinquish exploration rights in the Raukumara Basin, in deep water off East Cape in the Exclusive Economic Zone.

Painted locally as a victory for opposition organised by Greenpeace and local iwi Te Whanau a Apanui, the Petrobras decision came as the company retrenched across the world to deal with serious commercial problems in its home market.

TAG chief executive Garth Johnson expressed disappointment at Apache's decision.

"Whether we like it or not, this is the nature of the oil and gas exploration business around the world and we will treat it as an opportunity and move on," he said in a statement. "We will continue with the work programme on the East Coast in the same careful, methodical and safe way that we have carried out our work programme in Taranaki."

A much smaller company than Apache, the Canadian explorer has struggled at times to communicate its plans positively, but Dye said TAG was "a good company to work with."

Most of TAG's producing assets are in New Zealand, although its shares are listed on the Toronto Stock Exchange, which was not trading at the time of the TAG statement in New Zealand.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Oceans: NOAA Declares Third Ever Global Coral Bleaching Event

As record ocean temperatures cause widespread coral bleaching across Hawaii, NOAA scientists confirm the same stressful conditions are expanding to the Caribbean and may last into the new year, prompting the declaration of the third global coral bleaching event ever on record. More>>

Scoop Business: A Decade Of Government Pre-Seed Investment

More publicly-funded science is being commercialised after a decade of government ‘pre-see’d investment, according to an independent review. More>>


Solid Energy: Plan To Shut Unprofitable Huntly East Mine

Solid Energy, the state-owned coal miner in voluntary administration, plans to shut down its unprofitable Huntly East mine and lay off 65 staff after deciding the site stands "no chance whatsoever" of finding a buyer. More>>


E Tū: Merger Creates NZ's Biggest Private Sector Union

E tū has been created by the merger of the Engineering, Printing and Manufacturing Union and Service and Food Workers’ Union. It represents more than 50,000 working New Zealanders in industries as diverse as aviation, construction, journalism, food manufacturing, mining and cleaning. More>>


Internet: NZ Govt Lifts Target Speeds For Rural Broadband

The government has lifted its expectations on faster broadband speeds for rural New Zealand as it targets increased spending on research and development in the country's information and communications technology sector, which it sees as a key driver for export growth. More>>


Banks: Westpac Keeps Core Government Transactions Contract

The local arm of Westpac Banking Corp has kept its contract with the New Zealand government to provide core transactions, but will have to share peripheral services with its rivals. More>>


Science Investment Plan: Universities Welcome Statement

Universities New Zealand has welcomed the National Statement of Science Investment released by the Government today... this is a critical document as it sets out the Government’s ten-year strategic direction that will guide future investment in New Zealand’s science system. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news