New Zealand Oil & Gas, which is hunting out new investment opportunities, is in talks with prospective partners for the deepwater Barque prospect off Oamaru's coast after almost trebling the size of what a successful find could deliver.

Wellington-based NZOG is presenting the farm-in internationally on behalf of its 50/50 joint venture with ASX-listed Beach Energy, seeking partners with "experience and scale to drill the prospect", it said in a statement. The energy explorer and producer got an extension to the Clipper exploration prospect for the Barque prospect in October, at the time saying it could be equivalent to 530 million barrels of oil, at least twice the size of the Maui discovery that's been operating since the 1970s.

After further analysis and scoping work, NZOG has now upgraded its estimate for the prospect to 11 trillion cubic feet (tcf) of gas and 1.5 billion barrels of oil or gas condensate, across three different developments. The primary reservoir target it estimated to contain 5.5 tcf of gas and 785 million barrels of liquid.

The primary Barque prospect is given a 19 percent chance of discovery and the other two horizons each have a 15 percent chance, according to NZOG's presentation to potential farm-in partners.


If all three were developed at the same time, the company said a gas-to-shore LNG project was the most likely model. A regional economic impact assessment is being developed to better understand the options.

Domestic exploration has dwindled after last year's slump in global oil prices below US$30 a barrel made forays into remote parts of the world, such as New Zealand, less appealing for major international players. Since then prices have partially recovered, with Brent Crude recently at US$56.12 a barrel.

NZOG is sitting on cash after selling its 15 percent stake in the Kupe oil and gas fields to Genesis Energy for $168 million. While $100 million will be returned to shareholders, the rest is being held back while it seeks out bargain acquisitions in the current environment.

The company's shares rose 1.6 percent to 64 cents, having gained 57 percent over the past 12 months.