July 2020
Asking the burning questions
A new publication from PEPANZ highlights key energy challenges and opportunities facing New Zealand, in particular issues over our future supply of natural gas.
“Asking the Burning Questions” asks three key questions:
- What happens if our natural gas supply continues to decline?
- What does a declining gas supply mean for our emission goals?
- Do we have the right policy settings, given the changed environment for the oil and gas sector?
“Natural gas production is forecast to shrink 60% over the next 10 years which could increase costs for homes and businesses," says PEPANZ Chief Executive John Carnegie.
“In the absence of new exploration permits, we are now effectively in a closed and contracting system with rapidly shrinking natural gas reserves and shrinking opportunities to replace them.
“Renewable energy is great but it isn’t anywhere near affordable, reliable or practical enough yet to replace all the roles of natural gas.
“The answers to these questions will help us navigate an informed, evidence-based course towards a prosperous New Zealand with affordable, reliable and sustainable energy.”
New Plymouth election event
PEPANZ is hosting a special Election 2020 event in New Plymouth next month.
Our two expert guest speakers are Dr Oliver Hartwich (Executive Director of the New Zealand Initiative) and Phil O'Reilly (Managing Director of Iron Duke Partners.
Topics for discussion include:
- What are the big policy issues facing New Zealand?
- What are the likely outcomes of the election?
- What does this mean for the oil and gas sector?
5pm for a 5:30pm start: Tuesday 25th August
Gover Street: 31 Gover Street, New Plymouth
Energy Voices relaunched
PEPANZ's public educational campaign 'Energy Voices' is now underway again, reaching thousands of New Zealanders every week.
The social media campaign is aimed at informing the wider public on the importance of natural gas to New Zealand, especially as our economy recovers from Covid-19.
It uses graphics and videos to explain benefits of producing our local energy here in New Zealand rather than relying on imports, and role of natural gas as a transition fuel towards lower emissions.
The campaign is educational and non-political, based around Facebook, Twitter and a website.
Political update - Energy policies
*Pumped hydro: Energy and Resources Minister has announced $30 million in funding for a business case to consider a pumped hydro scheme in Central Otago. The project could cost up to $4 billion and eventually replace the peaking role of natural gas. PEPANZ has outlined our concerns in this opinion piece.
*Green party energy policy: is to ban new industrial coal boilers and bring forward the 100% renewable electricity goal to 2030.
*Māori party energy policy: is to end all oil and gas exploration permits, cease production at existing sites in five years and try to have sites decommissioned in 10 years.
*The National Party: remains committed to overturning the 2018 exploration decision with all three leaders over the last few months confirming this. In a recent opinion piece Energy spokesperson Jonathan Young says "we need more natural gas, not less."
We will keep PEPANZ members updated with relevant policies as they are released ahead of the election on September 19th.
Industry news
*New gas reserves data: the Ministry of Business, Innovation and Employment has released new data on our petroleum reserves, showing a 0.8 per cent decrease in proved plus probable (2P) gas reserves estimates over the past year. The data is here and PEPANZ's press release in response here.
*National New Energy Development Centre: this has officially been launched and renamed as "Ara Ake", based in New Plymouth. The new Chief Executive is Dr Cristiano Marantes. PEPANZ has welcomed the opening and recommended it focus on natural gas as a transition fuel and carbon capture and storage.
*EEZ decommissioning regulations: PEPANZ submitted on these draft regulations in June, and we are pleased that in response to submissions the Ministry for the Environment has decided to take more time to work through the important issues raised. A new draft is being prepared for comment, which means that the regulations will not take effect until after the General Election.
*Marine mammal sanctuaries for Maui and Hectors dolphins: PEPANZ's submission is here. We do not support the extension of the sanctuaries and prohibitions on seismic surveys, given there is insufficient evidence to show these dolphins are in the proposed extension area. A ban on seismic surveying is also disproportionate with any effects.
Every month we'll be profiling different PEPANZ members, highlighting the range of skills and services in our local industry.
Member profile: Marsh
Marsh is the world's leading insurance broker and risk adviser. They assist clients to understand and manage risk, helping them unlock new opportunities for growth.
Marsh can provide innovative solutions to risk challenges on projects and operational risk across New Zealand. They have a deep knowledge of the international and local energy and power sectors with offices in 14 locations across New Zealand, including a dedicated energy hub in Wellington and local representation in New Plymouth.
They continue to be at the forefront of New Zealand risk issues, and was pivotal in working with PEPANZ and its members to lobby government around offshore financial assurance changes affecting the New Zealand oil and gas sector. Marsh’s industry knowledge assisted members in negotiations which resulted in a much more equitable outcome.
To find out more you can contact Jon Griffiths - Practice Leader, Energy and Power New Zealand on 021 466 865 or jon.griffiths@marsh.com.
PO Box 25259, Wellington 6146
