In the past year Shell New Zealand has significantly expanded its local exploration efforts with a commitment to drill for gas in the Great South Basin and its acquisition of a prospecting permit in the outer reaches of the country’s continental shelf.
Shell, already the country’s largest gas producer, operates two large exploration permits in the Great South Basin on behalf of partners OMV and Mitsui.
It says the venture’s decision in January to proceed with drilling marks the single biggest investment decision by Shell in this country for decades and reflects a broader commitment from the Shell Group to the region.
In April the firm, working with partners CNOOC and Anadarko Petroleum, was granted a petroleum prospecting permit covering almost 150,000 square-kilometres of the New Caledonia Basin north-west of New Zealand.
Shell NZ chair Rob Jager says the preliminary sub-surface scientific research planned in the remote waters more than 400 kilometres from land marks a “new and exciting” chapter in the firm’s 100-year history in New Zealand.
The company, currently preparing to drill the Maui-8 and Ruru-2 wells, has already had a busy year working to extend the reserves from its existing assets on- and off-shore.
It is using the Archer Emerald rig to drill a series of side-track wells from the Maui A platform, the first time a fully-automated rig has been used in this way from an offshore operation. The work, which began a year ago, includes a five kilometre-plus extended reach well, and is continuing while production from the field is maintained.
Shell is also using world-leading technologies in its other activities. In September the firm conducted a dual walkaway Vertical Seismic Profiling survey in two new appraisal wells at Kapuni to better understand the remaining gas resource deep within the field.
It was only the second use worldwide of the technology, and the 1,600-metre, 106-level receiver array was one of the biggest configurations ever attempted. In another New Zealand first the trial used a revolutionary type of fibre-optic sensor – Distributed Acoustic Sensing – to improve the results from the down-hole seismic survey.
Shell accounts for 70 per cent of New Zealand’s total natural gas supply. Its recent successes at Maui, and the experience it has gained operating the Pohokura field the past seven years, saw remaining P50 gas reserves at the two fields increase by almost 400 PJ during 2013.
Health and safety
The company also improved its health, safety and environmental results, but says they should have been better. Among areas it highlighted for improvement were the two lost-time injuries, four restricted work cases and one medical treatment case reported in the period.
Shell also managed to use its health and safety programmes to deepen its relationships in the wider community. In November, hapu observers participated in an emergency response exercise at the Pohokura production station – a first for them and the company.
And 2014 has been no less busy for Shell. In February the firm completed its month-long, four-yearly maintenance shut at the Maui platforms and the Oaonui production station. The work was completed ahead of schedule and without any significant injuries or environmental discharges.
The same month the firm started a 2D seismic survey over 21,200 square-kilometres of ocean in the Great South Basin. The survey was conducted in accordance with Department of Conservation codes to minimise disturbance of marine mammals and was completed on time and on budget.
Shell notes that the two Dunedin crew changes during the project injected about $500,000 into the local economy during the two days the vessels were in port.
The Overall Energy Company of the Year Award category is sponsored by Port Taranaki