Company’s Doublespeak Over Methanex Deal:More Gas Investment & Consumption Will Help Energy Transition Away From Gas
The Gas Industry Company has reached new heights in 1984-style propaganda with its recent news release about Methanex’s deal with Genesis Energy to use the company’s surplus contract gas.
Chief Executive Andrew Knight claimed that Methanex plays a crucial role in New Zealand’s energy system and helps guarantee energy security by using lots of gas (they’re the country’s biggest consumer), which in turn encourages more investment in developing existing gas fields and building new infrastructure.
GIC is effectively a trade association that, bizarrely, reports to and advises the Minister of Energy and Resources under the 1992 Gas Act. NZOG and oil giant OMV are among the company’s shareholders.
Knight claimed “the transition to renewables requires investment confidence to develop existing gas fields, which in turn depends on long term supply contracts (to consume more gas).”
In fact, international climate research indicates that to achieve Paris greenhouse emissions targets there must be no new oil and gas infrastructure development. Such investments simply lock us into longer-term reliance on fossil fuels, not rapid energy transition which the climate crisis requires.
The International Energy Agency and the International Renewable Energy Agency, as well as our own MBIE, are predicting a significant decline in gas supply and demand over the next decade.
Methanex has been considering its future for some time, and made a purely commercial decision to close two of its plants because of concerns over future gas supply. It lucked out when Genesis agreed to take the company’s excess supply.
Knight instead portrays Methanex’s deal as an example of the gas industry doing its civic duty by plugging gaps and providing “needed flexibility” in the energy system as the country becomes more dependent on ‘variable resources’ – the fossil fuel industry’s spin language for renewables like solar, wind and hydroelectricity.
Renewables are already cheaper than fossil fuels in many jurisdictions, and rapidly becoming more reliable with new storage options.
New Zealand needs government policy settings that encourage more investment in renewables and related infrastructure, not carbon-based fuels, if we’re to accelerate our transition to a low emissions economy in time to make a real difference.