Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Waihapa Deal This Summer Could Mean "Game On" For New Zealand Energy.

|Includes:New Zealand Energy Corp. (NZERF)

(click to enlarge)

Several kilometres below the Waihapa Production Station may lie some compelling reservoir rock holding the promise of much needed hydrocarbons for the New Zealand economy and energy marketplace.

Origin Energy is transitioning the facility to hand over to NZEC or New Zealand Energy Corporation. In close proximity to the Waihapa area is a network of pipelines to sell any oil, gas or liquid to a hungry market.

Deep below Waihapa are two compelling rock layers or geologic formations with proven production nearby, Kapuni which is primarily gas, and Tikorangi which is Oil. The pressures are commercial quality so there is much excitement to drill exploration wells into this area.

Waihapa is the surface land area name, where as Kapuni and Tikorangi refer to what lies below Waihapa. The $42 Million deal between Origin Energy and New Zealand Energy could transact by Summer 2013. Upon final approval by NZ government and local permits this deal would bring major attention to an up-an-coming exploration play lead by the companies set-up in the Taranaki Basin.

Excitement centered around the Kapuni reservoir (liquids rich NGL) and the Tikorangi (oil rich, under high pressure, highly fractured due to volcanic formed geologic history, high quality API graded oil) make this a region with exploration potential in basins with proven hydrocarbons.

Much chatter has been blogged about whether the oil and gas production will be economic at waihapa, yet this deal has all the right attributes of a game changer for the size and scale of an early stage exploration and production company.

upto 26 wells could come with this Waihapa deal, plus licenses to drill on ready to spud leases that fast track the process of finding new reserves and growing production rather quickly. If this deal gets done soon you won't be able to acquire shares at these bargain prices near $0.50. It's a much better gamble now than it was last march at $3, and the land position is quite extensive, making long term viable discovery of new oil very probable and very profitable.

Disclosure: I am long NZERF.

Stocks: NZERF