Mitsui and AWE are taking 22.5% each of Transworld’s 45% stake in both PMP38158, which includes the Tui Area Oil Project, and the Hector South Sub Block of PEP38483, a petroleum exploration permit adjacent to the Tui Area. This equity was held through Transworld subsidiary New Zealand Overseas Petroleum.
NZOP will now become a wholly owned AWE subsidiary and will remain operator of the two blocks.
After the completion of both transactions, Tui Area interests will be: AWE Group 42.5% and operator; Mitsui E&P New Zealand Ltd 35%; New Zealand Oil & Gas Ltd 12.5%; and Pan Pacific Petroleum Ltd 10%.
AWE managing director Bruce Phillips has said the arrangements would give the company further cashflow growth in a known project with upside potential, increase proven and probable oil reserves at an attractive price, give AWE more control over the Tui Area project, and provide entry into a significant operatorship role.
Phillips said he anticipated the current Tui development management team in Houston and New Zealand would continue.
Tui’s estimated proved and probable recoverable reserves are about 27 million barrels of oil, and the total capital expenditure is projected to be about $US200 million.
Tui is currently in its development stage with production scheduled to start in mid-2007. Peak production rate is projected to be about 50,000 barrels per day, producing light, low-sulphur crude oil.
