Energy giant Shell will go ahead with drilling for gas in the Great South Basin.
A government-imposed deadline gave Shell until Friday to decide if it would start test drilling or forgo its claim.
The drilling programme is yet to be decided but ”will most likely target the early 2016 summer period”, the joint venture parties Shell NZ, OMV NZ and Mitsui E&P Australia said today.
“We are very grateful to the communities of Otago and Southland for the way in which they have engaged with us so far,” Shell NZ chairman Rob Jager said.
”We will ensure that open and honest engagement with all interested parties continues as the project matures towards the drilling campaign.”
Southland economic leaders said this week if drilling proceeded, Southland would not see any immediate financial impact but there could be future possibilities for the region.
The Green Party has called the venture “incredibly risky”.
Energy spokesman Gareth Hughes said the venture should not be allowed to continue.