Oil company OMV has been granted a two-year extension for drilling an exploratory well in the Great Southern Basin off the Otago Coast.
The Ministry of Business, Innovation and Employment (MBIE) has agreed to extend the Austrian oil and gas company's application for drilling the well from July 2019 to July 2021.
MBIE said new geological data shows there was justifiable need to change elements of OMV's permit.
The changes allow the company more time to find what it deems the right spot to drill the exploratory well.
OMV's permit for exploration for oil and gas in the Great Southern Basin has not changed, and will expire in 2022.
The company was granted the permit in 2007 for a 16,715 sq/km area.
The government announced in April it will stop issuing new exploration permits once existing ones run out'.