WELLINGTON: The price of oil has dropped about 60 per cent since June and the oil and gas industry around the world and in this country was feeling the pinch.
Kea Petroleum announced it would shut down production at its Puka Field site in Taranaki as a result of plunging oil prices.
In a written statement, the company said it had been working hard in the last few weeks to fix a technical glitch with the Puka 1 exploration well while continuing to produce from Puka 2 well.Unfortunately, the problem cannot be resolved with the equipment currently available.
“An alternative longer term plan is under consideration, however given the current oil pricing environment, the board has decided that the site is shut until the economics of the continued site operations improve.”The group said it was in talks with potential partners for the Mercury, Mauku and Shannon prospects.
TAG Oil had reviewed its exploration plan for this year, and deferred some work, but said it was still expecting a busy year. Rock-bottom oil prices also forced BP to lay off 300 staff working in the North Sea, while other companies have cut pay.
Mr Madgwick said companies were having to responsibly manage their spreadsheets, but peaks and troughs in oil prices were not unusual.
