Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


A Billion Dollars More Gas From Maui?

A Billion Dollars More Gas From Maui?

"Evidence that more gas can be extracted from the Maui field is good for New Zealand, but the extra gas will come at a much higher cost" said Mr John Blakeley, Convenor of the Sustainable Energy Forum (SEF). He was commenting on an analysis of the Maui gas situation included in the latest issue of Energy Watch - SEF's journal (see

Subsequent to this analysis, the Government's own publication Energy Data File (July 2004), released last week, reports an even chance of there being 300 petajoules (PJ) of gas recoverable from the Maui field as at 1 January 2003 over and above the 367PJ which the Independent Expert estimated at that date as being recoverable at the Maui contract price.

"Advice of this additional gas is welcome news because a sudden downward revision in gas quantities would have required drastic changes in electricity generation" Mr Blakeley said.

"The additional gas will give more flexibility in making the transition from Maui to new smaller gas fields such as Pohokura (estimated reseves of about 600 to 800PJ, commencing in 2006) and Kupe (estimated reserves of about 300PJ, commencing in 2007)".

"However, this additional gas from Maui will come at a much higher price than in the original 1973 contract, which provided for price rises to be only half that of inflation, so other fuels became progressively less competitive with Maui gas".

"A best estimate is that the current contract price is around $1.75 a gigajoule (GJ), to which the Government adds a resource levy and a margin before on-selling it to the users at a price which is probably between $2.50 and $3.00 per GJ. However, post-Maui gas prices are expected to be between $6 and $7 per GJ within the next year (as reported in the Dominion Post, 30 July 2004)." Mr Blakeley said. "Present post-Maui prices are probably between $5 and $6 per GJ (Dominion Post, 18 September 2004)."

"Under the agreement announced on 2 June 2004 between the Government and the other parties to the Maui contracts, any gas over and above that estimated to be recoverable at the Maui contract price by the Independent Expert will be sold at the current market price, which is about double the present Maui contract price to end-users, but more than triple the price currently received by the owners of the Maui field" Mr Blakeley said. "This will give a very strong incentive to obtain the maximum possible amount of additional gas which is economically recoverable from the field".

"The analysis in Energy Watch inferred that there may be at least 130PJ of such additional gas with an 85% probability of being obtained. The Government's own just-released latest issue of Energy Data File (July 2004) reports that up to 300PJ of additional Maui gas reserves exist with a 50% probability of being obtained".

The more conservative (Energy Watch) estimate implies that the additional gas will probably be worth at least $NZ800 million to the owners of the Maui field" Mr Blakeley said. The new just-released Energy Data File information indicates that the additional gas might be worth up to $NZ1.8 billion in total to the field's owners over and above the gas provided under the Maui contract. This is in line with a statement in the Dominion Post on Saturday 18 September which notes that Maui may produce another 300PJ if the owners decide to drill another part of the field, which the industry expects."

"If in fact 300PJ of additional gas is obtained from the the field, this will bring total Maui production up to 3862PJ compared with the original contract amount of 4060PJ, over 95% of that originally estimated amount" Mr Blakeley said. "The difference is that under the 2 June 2004 agreement, the field's owners will be receiving a lot more revenue now from obtaining some of this gas than provided for in the original 1973 Maui contract."

"We must use the 'more gas' breathing space to work hard on solutions that move us more rapidly towards a sustainable energy future" Mr Blakeley said.

© Scoop Media

Business Headlines | Sci-Tech Headlines


RNZ: Porirua Most Expensive Region To Rent, According To Trade Me

A rental website shows this town is now New Zealand's most expensive region to rent a house, ahead of Wellington and Auckland cities. More>>


Stats NZ: Nearly 1,000 More Big Businesses Now Than Two Decades Ago – Media Release

There are now 2,690 big businesses in New Zealand employing more than 100 staff – nearly 1,000 or 58 percent more than 20 years ago, Stats NZ said today. Over the 20 years to February 2020, the total number of enterprises in New Zealand increased ... More>>


RNZ: Housing Boom Could Get Worse, Economist Warns

Economists are calling on the Reserve Bank to reinstate lending restrictions, warning the housing market is spiralling out of control. More>>


Westpac: Sets Out Plan To Go Cheque-Free

Westpac NZ has announced details of its plan to phase out cheques, after signalling in May that it would be supporting a move to other forms of payment. Cheques will cease to be available as a means of payment after 25 June 2021. Westpac NZ General ... More>>


NZTA: Major New Zealand Upgrade Programme Projects Go To Tender

Two major New Zealand Upgrade Programme projects are beginning tenders for construction. The New Zealand Upgrade Programme is a $6.8 billion investment to get our cities moving, to save lives and boost productivity in growth areas. The first Auckland ... More>>

Reserve Bank: RBNZ Seeks To Preserve Benefits Of Cash

The Reserve Bank – Te Pūtea Matua is taking on a new role of steward of the cash system “to preserve the benefits of cash for all who need them”, Assistant Governor Christian Hawkesby told the Royal Numismatics Society of New Zealand annual conference ... More>>


CERT NZ: Malicious Computer Virus Targeting New Zealanders

CERT NZ, the government agency which supports organisations and individuals affected by cyber security incidents, says a recent surge of increasingly sophisticated malware attacks is affecting everyday New Zealanders as well as large organisations. The ... More>>


Economy: NZ Small Business Recovery Continues In September

Xero, the global small business platform, today released its Small Business Insights (XSBI) for September revealing an uptick in small business jobs and year-on-year revenue growth in New Zealand. Nationwide, the average number of jobs in the small ... More>>


Courts: Businessman Eric Watson Sentenced To A Four-Month Jail Term

New Zealand businessman Eric Watson has been sentenced to a four-month jail term in the UK for contempt of court, TVNZ reports. More>>

OECD: Area Employment Rate Falls By 4.0 Percentage Points, To 64.6% In Second Quarter Of 2020

The OECD area employment rate – the share of the working-age population with jobs – fell by 4.0 percentage points, to 64.6%, in the second quarter of 2020, its lowest level since the fourth quarter of 2010. Across the OECD area, 560 million persons ... More>>

Spark: Turns On 5G In Auckland And Offers A Glimpse Into The Future Of Smart Cities

Spark turned on 5G in downtown Auckland today and has partnered with Auckland Transport (AT) to showcase some of the latest in IoT (Internet of Things) technology and demonstrate what the future could look like for Auckland’s CBD with the power of 5G. 5G is ... More>>

Stats NZ: Monthly Migration Remains Low

Since the border closed in late-March 2020, net migration has averaged about 300 a month, Stats NZ said today. In the five months from April to August 2020, overall net migration was provisionally estimated at 1,700. This was made up of a net gain ... More>>