September 2021
New plan needed for decommissioning
Proposed new rules for decommissioning oil and gas infrastructure need a rethink to achieve their objectives and avoid unintended consequences, Energy Resources Aotearoa has told a select committee considering the legislation.
“The industry supports the intent of the Bill and our members are already set to take responsibility for decommissioning fields at the end of their lives,” says chief executive John Carnegie.
“However the Bill is regulatory overkill with different requirements piling on costs, far more than needed to protect taxpayers. Much of the Bill is retrospective, which is like moving the goal posts after the ball has been kicked.
“The overall impacts on the energy system could cost jobs, punish our exporters, and increase the cost of living for vulnerable New Zealanders.”
Energy Resources Aotearoa’s concerns are supported by independent advice commissioned from experts including Law Professor Philip Joseph, Justin Smith QC, international consultants Wood Mackenzie and economics consultants Castalia.
Castalia concluded the legislation would impose net costs to New Zealand of almost $1 billion, generating only 11 cents of economic benefit for every dollar of cost.
“Given there is no urgency with no fields due for decommissioning soon, we’d like to work with the Government on a new regime to achieve the goals we all share.”
New energy figures show big challenges
New energy figures show natural gas and coal are keeping the lights on for New Zealand as renewables sources struggle to keep up with demand.
According to figures from the Ministry of Business, Innovation and Employment (MBIE), renewable sources generated 75% of our electricity in the second quarter of 2021 - down 6% from the same time last year.
Coal contributed more than 12% of electricity generation in the same period, the highest level since 2008. Coal imports also increased to 632,200 tonnes, the highest quarterly figure on record.
“This highlights the major energy shortage New Zealand is facing and the pressure the system is under,” says Energy Resources Aotearoa chief executive John Carnegie.
“Our industry would like to work with the Government on an Energy Accord. This could encourage the investment needed to close our widening energy gap, and help the smooth transition we all want.”
Public events update
Covid-19 has stalled our next 'Meet the Chief Executive' event but work is underway on two exciting panel events to finish the year.
We will be hosting an event in New Plymouth on 30th November discussing the challenges and progress towards Taranaki's energy future, and our wider energy transition. A top-class line-up of speakers including community leaders will be unveiled soon.
We are also hosting a panel event in Wellington on the 8th of December, looking at lessons from a tumultuous 2021 and looking ahead to 2022. This will be followed straight after by our end of year event.
We are also working to reschedule our next 'Meet the Chief Executive' event with Methanex's Managing Director Dean Richardson (pictured right). We already have a strong line-up of CEOs primed for these events in 2022.
Energy Skills Industry Talent Corner
Each month Energy Skills will showcase a talented energy professional and their pathway into our sector.
Meet our first energy professional, Laura Hutterd - Production Engineer at Todd Energy.
Laura’s journey started from a conversation with Energy Skills manager Sheree Long at Auckland University’s Careers Day.
Laura then attended the Energy Skills University Student Programme at the New Zealand Petroleum Conference. This further sparked her interest and after graduating she was snapped up by Todd Energy as a Production Engineer.
Laura herself now attends careers and training days at universities around New Zealand, helping showcase opportunities in the sector to others studying in the science and engineering fields.
"Thanks to the Energy Skills Student Programme I was able to get an insight to the industry and the opportunities that were out there," says Laura.
"In my role I'm constantly learning and have been fortunate to be surrounded by great people with a lot of knowledge and experience. There is an ongoing focus on innovation and improvement within the sector which I really enjoy contributing to and being a part of."
UK facing energy crisis
The UK is facing food shortages and skyrocketing gas bills thanks to an unprecedented energy crisis.
Wholesale gas prices are up 250% from the start of the year, caused in large part due to increasing demand as the global economy emerges from Covid-19.
Extremely low wind generation is also adding to the stress, with coal-burning electricity stations having to cover the shortfall.
A shortfall in carbon dioxide is also hurting food suppliers who use it for refrigeration and animal slaughter. There are now warnings that UK meat could disappear from supermarkets within two weeks.
