Operator Origin Energy and partner New Zealand Oil & Gas told the ASX and NZX today that the Kupe joint venture had approved and adopted the reserves upgrade for the central area of the Kupe gas-condensate field in PML 38146.

They had revised the total proved and probable (2P) recoverable hydrocarbons from the Farewell Formation (the lower part of the Eocene-aged Kapuni Group) from 338 PJE to 394 PJE, net of estimated fuel gas usage.

They said that before this review, reserves estimates had been sourced from a study done by a previous operator.

The revised reserves estimate followed a major reinterpretation of the field which was done after the 1996 Kerry 3D seismic survey was reprocessed last year. The reinterpretation included remapping of the field and geological and reservoir simulation studies, the aim of which was to identify the optimum subsurface development scheme for the field.

Total revised 2P estimates of different products were now: sales gas 281PJ (281 PJE), LPG 627,000 tonnes (31 PJE), condensate 14.7 million barrels (82 PJE). These figures included a contribution from the basal oil leg.

Origin and NZOG said the optimum subsurface development scheme identified was being incorporated into an overall field development plan which would see production of around 20PJ of sales gas per annum, together with condensate and LPG production commencing at 1.7 million barrels and 45,000 tonnes per annum respectively.

Consenting processes and facilities engineering were proceeding and, subject to government approval, the joint venture expected to make the final investment decision (FID) in the fourth quarter of this year, with first gas targeted from late 2007.

Origin and NZOG said the parties were encouraged by this upward reserves revision, and by the potential for Kupe to play “a significant role in helping New Zealand meet its ongoing energy needs”.

The Kupe Joint Venture comprises operator Origin Energy Resources (50%), Genesis Energy (31%), NZOG (15%), and Mitsui E&P (4%).