INDEPENDENT NEWS

NZOG to look offshore for new oil opportunities

Published: Thu 12 Apr 2018 02:59 PM
NZOG to look offshore for new oil opportunities, no ímmediate impact on existing NZ operations
By Pattrick Smellie
April 12 (BusinessDesk) - New Zealand's only NZX-listed oil and gas explorer and producer says today's government announcements ending the issuance of offshore oil and gas exploration permits "will not have any immediate material impact" on its operations or earnings, but it will now start looking offshore for new opportunities.
"Potentially transformational New Zealand Oil & Gas exploration prospects in the Canterbury and the Great South Basins are unaffected by today’s announcement and the company is continuing to market these world-class prospects," NZOG's chief executive, Andrew Jeffries said in a statement.
NZOG shares fell 3.2 percent to 60 cents.
The company would "manage the risks associated with the government's policy change by investing in exploration and production assets in other jurisdictions".
NZOG is the permit-holder for the Barque exploration prospect, off the Canterbury coast, which Energy Minister Megan Woods said today held potentially "trillions of cubic metres of gas" which could still be exploited if NZOG made a discovery there.
"We are focusing on assets where our New Zealand capability can add value, with a preference for gas assets because gas is seen in most jurisdictions as a vital energy source for the
transition to a lower carbon world," said Jeffries, who described today's announcements as a "sudden change of policy" on which there had been no formal consultation with the industry.
The Labour Party campaigned before the 2017 election on a low-carbon future, 100 percent renewable electricity production by 2035 and a net zero carbon emissions economy by 2050 but the first suggestion it might end the six year-old practice of annually offering blocks of exploration territory to local and international oil industry players was on March 19, when Prime Minister Jacinda Ardern broke from her schedule to accept a Greenpeace petition calling for an end to oil and gas exploration.
Today's announcement ends only the offers for offshore exploration permits, with onshore Taranaki permits still to be offered for another three years, before that practice also is reviewed. Existing exploration and mining permits are unaffected by an announcement the government says is the first step in a 30-year "just transition" away from fossil fuels.
Jeffries said that while renewable sources of electricity could supply most of New Zealand's electricity needs in a year of normal rainfall, "another two-thirds of our national energy use is industrial and transport related, for which complete renewable alternatives are not currently economically viable".
"Therefore the choice for New Zealand is whether we use our own resources for our own benefit, or New Zealanders rely on overseas energy sources benefitting those economies."
(BusinessDesk)
ends
BusinessDesk
Independent, Trustworthy New Zealand Business News
The Wellington-based BusinessDesk team provides a daily news feed for a serious business audience.
Contact BusinessDesk
Email:

Next in Business, Science, and Tech

Wellbeing of NZers at the heart of Budget priorities
By: New Zealand Government
Insurers pay $226m to support recovery from extreme weather
By: Insurance Council of New Zealand
Transparent Overseer needed to regulate water quality
By: Parliamentary Commissioner For The Environment
Air NZ strike details: three days from 21 Dec
By: E tu
Forecasts show solid economic fundamentals
By: New Zealand Government
Making sure taxpayer dollars are spent wisely
By: New Zealand Government
Govt eyes $17.7B more tax as economy slows
By: New Zealand National Party
Kiwis struggling as tax take nears 50K per household
By: ACT New Zealand
Monthly Economic Indicators November 2018
By: The Treasury and the Reserve Bank
Wellbeing approach needs more detail
By: New Zealand Taxpayers' Union
Growing surpluses show need for tax cuts, not a CGT
By: New Zealand Taxpayers' Union
Underfunded Overseer tool needs thorough review
By: BusinessDesk
Potential for Overseer to improve water quality
By: Local Government NZ
Feds back recommendations for Overseer improvements
By: Federated Farmers
View as: DESKTOP | MOBILEWe're in BETA! Send Feedback © Scoop Media