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Swift Energy Announces 10-Year Gas Contract in New Zealand
HOUSTON, May 1 /PRNewswire/ -- Swift Energy Company (NYSE: SFY - news; PCX: SFY) and New Zealand electricity generator, Genesis Power Limited, announced today their agreement for the sale by Swift to Genesis of 40 petajoules (approximately 38 billion cubic feet) of natural gas over a 10-year period.
Natural gas deliveries from Swift's Rimu discovery in New Zealand will begin under this contract once production and gas processing facilities are completed, which is expected by the end of this year. The contract calls for deliveries of up to four petajoules (3.8 billion cubic feet) per year for ten years to be used by Genesis Power at their Huntly Power Station, New Zealand's largest thermal power station.
As previously announced, Swift has drilled five wells at its Rimu discovery. Three have been successfully tested while the other two have encountered the same intervals that are productive in the other three wells and are awaiting a workover rig to begin completion operations. Swift has begun construction of production and gas processing facilities, which are initially designed to handle 3,500 barrels of oil per day and 10 million cubic feet of processed natural gas per day. Swift has identified over 8,000 acres in the Rimu area with a reserve potential between 40 and 100 million barrels of oil equivalent. Additionally, the Company estimates that the Kauri Prospect could hold an additional 200 to 500 million barrels of oil equivalent of prospective reserves.
Terry Swift, President of Swift Energy Company, noted that, ``This agreement with Genesis Power is a significant strategic step in our development of the Rimu area. While New Zealand's gas markets have a lower price structure than in the U.S., this transaction demonstrates that we have the ability to sell natural gas in New Zealand into the power markets. This 10-year supply contract enables the early development of this predominantly liquid fuel field.
``We continue to be pleased with our success at Rimu, and we are particularly excited now as we begin drilling the initial well to evaluate the Kauri Prospect.''
Genesis Chief Executive Murray Jackson says the contract with Swift Energy is significant as it further secures the competitive positioning of New Zealand's largest thermal station at Huntly.
``The contract with Swift is timely as Genesis investigates the establishment of a new high efficiency Combined Cycle Gas Turbine power plant, to be built within the existing Huntly Power Station site,'' says Mr. Jackson. ``This contract is another important step for Genesis in ensuring that Huntly can operate to its full potential in the coming years.
``Whilst Huntly will continue to have the versatility of using either gas or coal, this new contract with Swift will mean that gas will continue to be the dominant fuel. Genesis already has an eight year contract for 90 petajoules of gas to be supplied by Natural Gas Corporation of New Zealand Limited (NGC).''
Swift Energy New Zealand Ltd., as operator, holds a 90% interest in the permit where the Rimu discovery is located, which covers 100,652 net acres extending both onshore and offshore on the western coast of the northern island of New Zealand. Antrim Oil & Gas, Ltd., a wholly owned subsidiary of Calgary-based Antrim Energy, Inc. (CDNX: AEN - news), and Marabella Enterprises Ltd., a subsidiary of Brisbane-based Bligh Oil and Minerals Ltd. (Australia: BLO), each hold a 5% interest.
State-owned, Genesis Power is an electricity generating, marketing, trading and retailing company that owns seven power stations, including the 1,000-megawatt Huntly Power Station. |
