Jackson said at the 2004 NGC Lecture Series in Wellington last night that Genesis research showed the importation of LNG would mean access to sustainable offshore gas supplies for at least 50 years, at prices that roughly matched that of domestic gas.

“However, investing in LNG infrastructure is capital intensive and locating a new large onshore gas field would be preferred to preserve our balance of payments.”

He said Genesis Energy, operator Austral Pacific Energy and the other PEP 38738 partners might achieve that goal through the drilling of the Cardiff-2 well in the onshore Taranaki licence later this year. (Austral believes the Cardiff prospect could contain 1 tcf or more of gas in the Eocene-aged Kapuni sands.)

Genesis and this country’s other largest gas user, Contact Energy, late last year announced a study into the feasibility of importing LNG post-Maui. They have not yet reported on the results of that study, though Jackson’s comments are the first indication that the price of domestic gas will continue to increase until it roughly equates to the expected landed LNG cost of NZ$6-7 per Gigajoule.

At the March NZ Petroleum Conference BP New Zealand chief executive Peter Griffiths said BP could import LNG into New Zealand from its Tangguh field in Indonesia; while Woodside Petroleum LNG executives David Maxwell and Ernie Kennedy said New Zealand was very well placed to get LNG from Australia, with likely sources from North Australia, the North West Shelf fields or even the Otway Basin.

Jackson also said last night that Genesis was pursuing Waikato coal reserves and evaluating fuel technology options for a 400MW supercritical boiler.

A “mine-to-mouth” coal supply would mean significant cost advantages to development, though the 100m-tall chimney stacks and other environmental considerations would virtually rule out any site in the greater Auckland area or other built-up areas in the Waikato.

Genesis was also considering extending the life of the existing dual-fuel 1000MW Huntly station and believed the present plant could continue as a base-load generator for a further 15 years, and as a reserve generator after that depending on coal and gas availability and emission issues.

Jackson believed New Zealand would require 200MW per annum of new capacity with up to 50% coming from renewable energy for the next few years.

“New Zealand has the expertise and resources in its State-owned enterprise and private sector to more than adequately meet the growing demands of a healthy economy in both electricity generation and transmission. We should now get on with the task ahead of us,” he concluded.