The Tui Area Oil Fields are located in the offshore Taranaki basin, New Zealand, approximately 50km off the coast in water depth of about 120m. Production began on 30 July 2007 - just 4½ years after discovery, and 20 months after the investment decision was taken. Tui was New Zealand's first stand-alone offshore oil development.

Tui Movie

Click here to view a short film on the Tui Oil Fields.

The Tui joint venture partners are:

New Zealand Oil & Gas Limited* 12.5%
Australian Worldwide Exploration (AWE)* 42.5%
Pan Pacific Petroleum* 10%
Mitsui E&P Australia Pty Limited 35%
*via subsidiaries

AWE is the Operator of the Tui Area Oil Fields, on behalf of the Joint Venture.

The Development

photo
Tui Map (click map for larger version)

The Tui Area Oil Fields lie within PMP 38158. Three separate oil accumulations have been developed - Tui, Amokura and Pateke.

The development comprises four horizontally drilled and subsea completed wells, each tied back to a leased Floating Production Storage and Offtake (FPSO) vessel, the "Umuroa". The extended horizontal production sections in the oil reservoirs range from 819m to 1850m.

The Tui Area Oil Project was developed at a cost of US$274m, with NZOG's share amounting to US$34m. The FPSO is the main operating cost.

In May 2008 an agreement was signed extending the charter of the Umuroa, through to the end of 2022. 

Production

FY2011 Oil Production Performance
August 2010: approximately 213,000 barrels of oil. NZOG's share 27,000 barrels.

FY2011 to date (to 31 August): 429,000 barrels. NZOG's share 54,000 barrels.

Tui production began on 30 July 2007. Total oil production to 31 August 2010 is approximately 28.6 million barrels. NZOG's share of total production is approximately 3.58 million barrels.

FY2010: 4.83 mmbbls. NZOG's share 604,000 barrels.

FY2009: 9.12 mmbbls. NZOG's share 1.14 mmbbls.

FY2008: 14.23 mmbbls. NZOG's share 1.78 mmbbls.

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Tui FY 2010 Production

Production from Tui has been higher than originally expected.

Associated water has been produced at a lower rate than that predicted by the original field simulation models, allowing a high oil production rate to continue for longer.

The facilities have also performed extremely well. Oil has been produced on every day apart from a scheduled six day maintenance shutdown in December 2008.

Production for the period ended 30 June 2008 was 14.23 mmbbls, against a pre-production estimate of around 9 mmbbls.

Production for the year ended 30 June 2009 was 9.12 mmbbls, against an original forecast of 6 mmbbls and a revised forecast of 9 mmbbls.

Production for the year ended 30 June 2010 was approximately 4.83 mmbbls, against an original forecast of 5.1 mmbbls and a revised forecast of 4.8mmbbls.

Reserves

A worker on the Tui FPSO
Onboard the Umuroa

The proven and probable (2P) reserves for the Tui Area Oil Fields have been increased several times:

July 2007 27.9 mmbbls (Pre-production)

27 August 2007 32.0 mmbbls (Preliminary post-drilling review)

22 November 2007 41.7 mmbbls (Detailed post-drilling reassessment)

21 May 2008 47 mmbbls (Extension of FPSO charter)

20 June 2008 50.1 mmbbls (Field reassessment)

25 August 2009 50.5 mmbbls (Annual Reserves Review)

Revenue

Tui oil is a light, sweet crude that is generally sold, with freight and quality differentials, against the regional Tapis benchmark crude. It is typically sold into refineries on the east coast of Australia or in south-east Asia.

Tapis Benchmark Crude - average Tapis prices per barrel:

Month  Average Tapis Price NZ$ Equivalent
August 2010 US$79.22 NZ$110.78
July 2010 US$77.64 NZ$109.14
June 2010 US$76.94 NZ$111.10
May 2010 US$79.51 NZ$113.96
April 2010 US$86.39 NZ$120.59
March 2010 US$81.21 NZ$115.55
February 2010 US$76.95 NZ$110.00
January 2010 US$80.24 NZ$110.31
December 2009 US$77.59 NZ$108.44

(NB: These average US$ Tapis prices are sourced from the US Energy Administration and are a guide only; they do not directly relate to the sale price for Tui oil shipments.)

For the year ended 30 June 2010, NZOG's share of production was around 604,000 barrels. NZOG received NZ$67.9m in revenue, with an average sales price of approximately NZ$104 per barrel.

For the year ended 30 June 2009, NZOG's share of production was around 1.14 mmbbls. NZOG received NZ$138.7m in revenue, with an average sales price of approximately NZ$122 a barrel.

For the year ended 30 June 2008 (11 months of production) NZOG received NZ$222.8m in Tui revenue, from the sale of approximately 1.78 million barrels, at an average price of approximately NZ$125 a barrel.

NZOG achieved project ‘payback' - recovery of all exploration and development costs for the Tui Area Oil Project - in approximately four and a half months.

History

Technical Achievements

Geology

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