Cautious welcome of new natural gas reserves

New data showing a 2.6% increase in proved plus probable (2P) gas reserves estimates over the past year has been welcomed, but with a note of caution from Energy Resources Aotearoa.

“It’s good news for New Zealand to see a small increase in the amount of reserves expected from the Maui and Turangi fields, given the current energy shortage we are grappling with,” says chief executive John Carnegie.

“However, reserves are theoretical until actually produced. Investment into existing assets is underway which is great news in the medium term, but beyond that we are still extremely concerned.

“In recent weeks we’ve seen record amounts of coal imported and energy prices rise sharply, while private company New Zealand Oil and Gas has chosen to invest in Australia instead of here.

“Without the right investment conditions, the Gas Industry Company warns there may not be enough natural gas to keep the lights on and ensure security of supply for electricity by 2026.

“We need to see more of a focus on lowering emissions through the ETS rather than policies designed to actively push gas out of the electricity market, such as the 100% renewable electricity target.

“Combined with no new exploration and fields needing investment just to maintain current production levels, it shouldn’t surprise anyone if the gas market remains tight.

“Getting our energy policy settings right to deliver the investment required to change this situation has never been more important.”