Wellington-based New Zealand Oil & Gas Ltd (NZX: NZO) is making it a priority to get joint venture partners aboard for its two Great South Basin targets, off the coasts of Otago and Southland.

Billion-dollar Monaco-based Ofer Global took a controlling 69.87% stake in the company (NZOG) last December for $84 million, but is not bankrolling any exploration programme in New Zealand, or elsewhere.

NZOG and Beach Energy Ltd (ASX: BPT) are 50:50 partners in the Clipper permit off the coast of Oamaru, which hosts the Barque prospect and recently gained a permit extension to April 2019.

NZOG now has 100% ownership of the Toroa permit, south of Dunedin off the Southland coast, and has until April 2020 to make a decision on drilling.

Both areas have been test-drilled in the past and shown hydrocarbons, but not in commercial quantities.

In its half year to December report, chief executive Andrew Jefferies said given the worldwide connections of Ofer Global, NZOG was no longer limited to using its $84 million cash balance.

“We are looking to acquire assets that have a value of more than $100 M, and upside development potential,” Jefferies said.

NZOG's preference is for gas production acquisitions, as over the next three to four decades it would play a crucial role in the transition to a lower carbon world, he said.

However, NZOG was also looking for near-term drilling opportunities to complement prospects Barque and Toroa, which Jefferies described as “world class,” and also its Ironbark prospect of Australia's North West coast, off Western Australia.

“Completing the farm-out process for these deep-water prospects and moving towards drill or drop decisions is a priority,” Jefferies said.

The reporting period was “dominated by takeover activity,” and NZOG had emerged with Ofer Global as a strong major shareholder, which reconfigured NZOG's strategy, he said.

“The outcome of the takeover process resolved a dilemma about the best pathway forward for the company,” he said.

Since the oil price downturn began in 2014, NZOG had been exiting low priority exploration targets, to reduce costs, and had sold production assets.

Jefferies said in February he hoped both Barque and Clipper could be marketed together for exploration, and also attract an oil rig for test-drilling both prospects at the same time.

Because of capital returns and Ofer's stake, Jefferies said there were now a large number of shareholders left with very small parcels of shares.

NZOG was looking at an economic way those shareholders could either increase their stakes above the minimum threshold, or have their shares sold on their behalf.

*Simon Hartley is senior business reporter and assistant chief reporter for the Otago Daily Times.