The Press FRIDAY, MARCH 4, 1966. Marine Survey For Oil—And Kapuni

Press, Volume CV, Issue 31000, 4 March 1966, Page 12

The Press FRIDAY, MARCH 4, 1966. Marine Survey For Oil— And Kapuni

The announcement that the shelf off the Canterbury coast will La included in a marine seismic survey conducted by the BP-Shell-Aquitaine-Todd consortium is satisfactory—up to a point. It is wholly satisfactory that the world-wide extension of the search foi oil from the land to the continental shelves under the sea is being extended to New Zealand. This exceedingly expensi: ? development in the oil search has been fruitful in several parts of the world which include the Persian Gulf, the coast of Nigeria, and the North Sea. But a survey of the kind now under way off the New Zealand coast is merely a preliminary glance at structural possibilities. If promising outlines of structure appear after broad surveys, then follows a programme of detailed surveys, and if the prospects then look good, a decision to drill at sea might be made. Even then, jnly after test drilling can it be determined whether a return is to be expected from the expenditure of probably several million pounds. Obviously, prospectors will assess the chances in any area by judging the incentives offering—and incentives are not by any means confined to geological possibilities. It is here that doubts occur about New Zealand seeing more work off its coasts than the preliminary survey now being made. Three of the partners in the marine survey— BP-Shell-Todd—are the owners of the Kapuni field where natural gas in commercial quantities was discovered in 1962. Ever since, arguments have continued as to its b—t use. The oil companies with the support of world-wide experience in the development and exploitation of gas-fields have advised one course; advisers engaged by the Government another. The question to be answered, of course, is what is the best use of the gas in the long-term national interest. This would surely best be determined by combining the wisdom of all interested parties. Instead, the Government has pursued an apparently determined course, leaving the oil companies outside its discussions. If the consortium feels aggrieved at such treatment it is understandable: if the consortium feels that tardy pursuit of its chosen course by the Government deprives the consortium of any return on a substantial investment, this also is understandable. The Government’s dickering for more than three years with Kapuni gas may be contrasted with the expedition with which the British Government reached agreement with the company discovering gas under the North Sea. Within a few months of the discovery a contract was made at a generous price for three years, thus, as the “ Financial Times ” said, “ enticing the North “ Sea gas searchers ”. What enticement do the Kapuni proceedings offer to concerns having the choice of dozens of areas in the world in which to lay out funds for off-shore exploration to choose New Zealand? This aspect was tardily recognised nearly six months ago by the Minister of Mines, Mr Shand, when he said in Parliament on September 3: “ If we “ are to treat the oil consortium other than fairly and “ honourably over the prices for gas we *ay pay very “ dearly for their attitudes towards exploration and “ exploitation of the considerable potential overseas “ reserves of oil