Simeon Brown Cites Petroleum Reserves Report, Calls for Reversal of Oil and Gas Exploration Ban

The MBIE report states that New Zealand’s gas reserves represent only 8.7 years of use, and that deliverability of gas from current fields will continue to decline.

Energy Minister Simeon Brown says MBIE's annual Petroleum Reserves report, detailing a 20 percent reduction in New Zealand's natural gas reserves, underscores the need to reverse the oil and gas exploration ban.

"Figures released by MBIE show that there has been a 20 percent reduction in New Zealand's natural gas proven plus probable reserves over the past 12 months, dropping to 1,300 petajoules," Mr. Brown stated.

"While 44 percent of this reduction has been due to gas extraction and use, 30 percent is due to reserves being downgraded, and 26 percent due to reserves being removed altogether as operators now understand the relevant fields hold less gas than previously thought.

"This report makes for very concerning reading. New Zealand's exporters and manufacturers need more natural gas to power their businesses and produce value-added goods to drive economic growth, but natural gas production cannot currently meet demand.

"New Zealand's insufficient supply of gas to meet demand is stifling economic growth and reducing our energy security. Natural gas plays a critical role in firming our electricity generation, particularly when intermittent renewable energy sources such as wind and solar are not generating."

The MBIE report states that New Zealand's gas reserves represent only 8.7 years of use, and that deliverability of gas from current fields will continue to decline.

"Reduced gas availability means that firms will look to other sources of energy, such as coal, to meet demand. Coal has around twice the carbon intensity of natural gas for the same amount of energy. We are already seeing more coal being used to firm New Zealand's largely renewable electricity sector simply because the required natural gas has not been made available."

Mr. Brown criticized the previous government's policies, claiming they have led to reduced economic output and increased reliance on high-emission coal to meet energy needs.

The Coalition Government is working to ensure New Zealand's energy security by:

Reversing the ban on oil and gas exploration: This initiative is led by Resources Minister Shane Jones and is a commitment under both the NZ First and ACT coalition agreements with National.

Enabling Carbon Capture Utilisation and Storage (CCUS): The Government has begun consultation on an enabling regime for CCUS technology, which is used overseas to significantly reduce emissions from gas use.

Taking immediate action with the Gas Security Response Group (GSRG): This group brings together gas producers, major gas users, and the Government to focus on gas supply and demand issues in both the short and longer term. It is considering ways to ensure natural gas reaches those who need it most, including schools, tertiary institutions, and hospitals as part of the All-of-Government contract.

"The Coalition Government is committed to ensuring New Zealand's energy security. We are working at pace to reverse the policies that have got us into this position and to restore investment confidence to the energy sector," Mr. Brown concluded.