Oil and gas exploration heating up in Taranaki

Sunday, 4 June 2017

Tag Oil Sidewinder drill site near Inglewood

Oil and gas exploration is heating up in Taranaki but don't expect sudden changes in employment levels, industry insiders say.

TAG Oil recently announced plans to spend $28.9 million on exploration, production and reassessment of old sites during the next 18 months at five onshore wells in the region.

Shell Todd has applied for two marine resource consents to drill offshore. The company said the consent applications was the first step in a long process and it was too early to comment on economic effects for the region.

TAG Oil country manger Max Murray said the workload would increase but no new jobs would eventuate.

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Murray said the exploration cycle was rebounding after oil dropped from over US$100 a barrel down to around US$27 a barrel before rising up to US$50 in the past two years.

'Although the price hasn't risen a lot, and has plateaued we've got a bit more certainty and that is the key to our forward planning.

'We're seeing some stability now to make decisions for the future.

'If the wells are successful there will be a flow on effect to the community.'

Venture Taranaki chief executive Stuart Trundle said increased exploration activity in the region was welcomed as the potential start to a sustained upswing in the region's economic fortunes.

Research found that activity in the oil and gas sector was projected to increase over the coming two years, he said.

There would be a demand for skilled workers coming from both major plant shutdowns and project work.

The oil and gas industry created employment, directly and indirectly, for more than 7000 people in Taranaki, he said.

'Increased activity in the sector is positive news for those skilled workers, their families, and businesses across the local economy.

'As well, the trickle down impact of more discretionary spend in the regional economy should boost investor confidence in all sectors of local industry and commerce.'

Oil and gas industry recruitment agency owner Tim Carrington said the Taranaki fields would need to be successful before any large scale employment was contemplated.

'I haven't noticed any changes as yet although any drilling has to be seen as proactive and positive for the region,' he said.

'When you get success, everyone notices but there is never ever any guarantee, that's the nature of the industry.'

Staff would be in short supply when there were positive signs of a successful programme, he said.

'There is always a shortage when its gets busy.'

Port Taranaki chief executive Guy Roper said the announcements by TAG Oil and Shell Todd was positive news for both the industry and the Taranaki region.

'It was too early to determine what impact the developments would have on Port Taranaki,' he said.

'Shell Todd were in the early consenting phase, while TAG Oil production is onshore and any additional volumes will come through us without any need for change to our operations.

'As New Zealand's premier oil and gas port we have the onshore and offshore infrastructure and expertise on-hand to assist developments in the industry as and when required.'