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Diversity needed for NZ gas supply: expert

The New Zealand gas market needs to move away from the dominance of a single field scenario, says...

"The industry here has been moulded by one field, Maui and now that is in decline it is possible Pohokura could continue that dominance," he said during the first day of a four-day workshop on natural gas supply and transportation being held in New Plymouth.

"Security of supply has to be the foremost concern, but that security could be at the cost of a lack of competition and the developing of other fields. These two concerns are not mutually exclusive but striking the right balance could prove difficult."

Stickley, a former Petrocorp executive, said dominance of the market, by one field or one consortium of companies, actually created difficulties and acted as a disincentive for explorers to come to New Zealand.

This contrasted with the position put forward by the Pohokura partners Shell, Todd Energy and OMV Petroleum who earlier this month told the Commerce Commission joint marketing was pro-competitive and would attract more exploration. The commission is due to deliver its final determination on the Pohokura partners' application early next month.

He said the Pohokura partners' application to jointly market their gas was a good example of the difficulty of balancing security of supply with concerns regarding market dominance.

Stickley said another worry the New Zealand industry had was the almost complete lack of energy planning during the past 15 years or so. There had been some general objectives, but those had often meant keeping government policy separate from economic effects.

"However, these two should work hand in hand and it's good to see the various sector reviews and organisations like the Commerce Commission and Ministry for Economic Development working more closely."

Stickley said he and fellow Wellington-based consultant John Duncan had never held a workshop in New Plymouth before, but had decided to run this event because of the rapidly changing New Zealand gas market and the opportunities opening up for industry participants, including coal bed methane.

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