The operator of the Tui oil field off the coast of South Taranaki has told a consents hearing that if no further development is undertaken the resource could be uneconomic by the end of next year.
Malaysia-based Tamarind wants permission to drill up to five side-track development wells. Photo: 123RF
The Environmental Protection Authority is hearing a marine consents and marine discharge consents application from Tamarind Resources in New Plymouth.
Malaysia-based Tamarind wants permission to drill up to five side-track development wells and potentially discharge trace elements of harmful substances from deck drains.
The company's representative Lauren Wallace told the hearing the Tui Field had a proven history of successful extraction.
"The field has produced more than 40.7 million barrels of crude oil since production began in 2007."
But that could soon change, Ms Wallace said.
"If no further activity is undertaken in the field, it is likely that by the end of 2019, production rates from the field will be uneconomic and the assets will need to be decommissioned."
Ms Wallace said the objective of the side-track wells was to access a future 7.5 million barrels of oil reserves from Tui.
"Tamarind considers that a successful outcome of the proposed activities would extend the life of the Tui Field to 2025."
At the end of 2016, the government received $573 million in royalties from Tui Field and an additional $10.3 million was forecasted up to 2020.
Ms Wallace said Tamarind believe the environmental impact of its planned work programme would be "negligible to minor".
"The applications will not result in any new wells being drilled into the seabed or any new structures being placed on the seafloor."
A side-track development re-enters a well from a surface location with equipment designed to deviate from the existing well bore and find oil in an alternate zone.
Ms Wallace told the hearing the marine discharge consents application was made with an "abundance of caution" for offshore drilling rig deck drainage potentially containing trace elements of harmful substances.
The EPA has received 124 submissions on Tamarind's applications, 108 are opposed to the granting of consents while 12 are in favour.
Three submitters want conditions applied if the applications are successful and one was neutral.
The vast majority of those opposed to the applications, 95, filled out a submission form prepared by Climate Justice Taranaki.
In its written submission, the environmenal group argued Tamarind's impact assessment did not provide sufficient detail to enable the EPA to understand the effects on the environment and existing interests, as required under the Exclusive Economic Zone Act 2012.
"The information provided is uncertain and inadequate and the Minister must favour caution and environmental protection," Climate Justice Taranaki wrote.
The group said the cumulative affects of the Tamarind applications and other industrial activity in the South Taranaki Bight on marine species had not been properly assessed.
"The risks to endangered and critically endangered species are unacceptable," it said.
In its submission, Te Kāhui o Taranaki said the iwi had been in discussions with Tamarind.
It asked that if the application was successful, Tamarind make a commitment to working with the Taranaki iwi to develop environmental indicators using both Te Ao Māori perspective and western science.
It also wanted Tamarind staff to undergo cultural training and for the company to commit to an annual meeting with Taranaki iwi.
Te Korowai o Ngāruahine Trust recently wrote to the EPA to update it on its relationship with Tamarind.
In the letter, the South Taranaki iwi said it had met with Tamarind to address Ngāruahine's concerns about the lack of attention the company was paying to its rohe.
It said Tamarind and Te Korowai were developing a Relationship Agreement and the company had committed to engage in dialogue with Ngāruahine hapū.
In October, the EPA granted OMV New Zealand a similar application for a marine discharge consent.