* Ten permits awarded, most in Taranaki
* Permit holders commit to survey, wells
(Adds detail, government comment)
WELLINGTON Dec 11 The New Zealand government
has awarded 10 five-year oil and gas exploration permits on
Tuesday, including in the rarely explored waters in the
country's southern region.
The majority of the five onshore and five offshore permits
were awarded in the Taranaki region, which has all the country's
commercially producing oil and gas wells, with production worth
around NZ$2.5 billion ($2.1 billion) a year.
A joint venture between Shell, OMV Limited
, and Mitsui E&P Australia Pty Limited will
drill in the seldom tapped Great South Basin off the eastern
coast of the South Island.
Shell has a 50 percent share of the offshore project, which
will explore around 8,500 square km (3,280 square miles) of deep
sea bed, in a region prone to rough conditions and storms.
Offshore and onshore permits were issued to New Zealand Oil
and Gas Ltd, Cheal Petroleum Limited and East West
Petroleum (NZ) Limited, NZEC Limited, TAG Oil (NZ) Ltd
, Todd Exploration Limited and Cue Taranaki Pty Ltd
to explore the Taranaki Basin on the west coast of the
U.S. based Anadarko, won two offshore permits to
explore around 7,000 square km of the previously unexplored
Pegasus Basin off the southern tip of the North Island.
"The award of two permits over the previously unexplored
Pegasus Basin and another in the Great South Basin confirms the
potential prospectivity of New Zealand outside Taranaki," Energy
and Resources Minister Phil Heatley said in a statement.
Permit holders have committed to carrying out seismic survey
work and in several of the onshore areas drilling exploration
Heatley said the projects were expected to see initial
spending of NZ$82 million, and could ultimately lead to
expenditure of NZ$776 million in five years.
A total of 23 blocks were offered, with bids received for
only 13 blocks.
Last week, Brazilian state-controlled oil giant Petrobras
handed back a permit to explore a deep sea
prospect off the east coast of the North Island, because it had
not found sufficient signs of oil and gas to justify further
(Reporting by Naomi Tajitsu; Editing by Ed Davies)