Mosman Oil & Gas announces oil discovery in New Zealand

Mosman Oil & Gas has announced the first oil discovery at its Cross Roads-1 well drilled at the Petroleum Creek project in New Zealand.

The company has confirmed that it hit two 8.5m zones in the Eight Mile formation, the upper zone being explored by the Cross Roads 1 well. The Cobden limestone, which has shown signs of oil reserves, is being drilled to test to a deeper target.

The company said that the data available from Eight Mile is considered sufficient to announce a genuine oil discovery.

Mosman Oil & Gas chairman John Barr said that the company is delighted to get an oil discovery in the first half of the first well, so soon after drilling commenced at Cross-Roads 1.

"We are now encouraged by the oil shows in the Cobden limestone and look forward to seeing the results from drilling the rest of this well," Barr added.

"The results to date appear to be a proof of concept for the 22 prospects and leads identified by geophysics at Petroleum Creek in addition to the Crestal area."

Following the completion of drilling, the company has now begun detailed planning for the testing and appraisal programme.

In March, Mosman raised £1.5m through IPO, giving it a valuation of just under £5m at the time, in support of the Petroleum Creek programme.

Situated 40km from the town of Greymouth, on New Zealand’s South Island, Petroleum Creek covers 144km².

The report from consultant SRK points to a mean unrisked recoverable prospective resource of 26 million barrels of oil, while the P90 estimate is 4.8 million barrels and the P10 is 59.2 million barrels.