South Port hopes OMV will secure NZ's energy supply

Monday, 27 January 2020

Abe Baillie climbs the oil rig while Andrew Sutherland and Jen Olsen give support at Wachner Place for a protest against oil giant OMV oil exploration expedition at Great South Basin.

Finding gas in the Great South Basin could help New Zealand become carbon-free, SouthPort Chief Executive Nigel Gear said.

OMV has approval to undertake exploration off the coast of Otago between Dunedin and Invercargill.

Gear said the security of energy supply was a major issue the country would need to face in the next 10 to 15 years.

'After this period there is uncertainty about the energy resources that will be remaining in Taranaki and the country needs to move now to ensure our economic future,' he said.

* Gear: The province does look to be in good heart

* EPA grants drilling and discharge consent for Otago coast to oil and gas company OMV**

Gear said a transition to a low-carbon economy was 'the ultimate goal' for New Zealand, but said the path to using large-scale 'non-fossil fuel energy' had not yet been clearly defined.

He believed the discovery of new gas reserves would help New Zealand achieve its 2050 zero carbon target.

'The obvious transition energy is natural gas,' he said, and added that 12 to 15 per cent of the country's electricity was supplied through natural gas from Taranaki.

This was the third-largest source of electricity behind hydro and geothermal generation, Gear said.

'Once these resources are depleted, the options are to import more costly gas resources from offshore or alternatively burn coal, neither of which are beneficial for the environment or our economic future,' he said.

In its transitional plan released in June, the Interim Climate Change Commission said natural gas would be of particular use during 'dry years'.

'However, the committee is clear that New Zealand cannot rely on generation from natural gas indefinitely and work must continue on alternatives, for example, pumped hydro storage,' the commission said.

'South Port has every confidence in OMV's ability to carry out these exploration activities without causing any detrimental impacts to the environment and local fishing industries,' Gear said.

SouthPort wasn't currently involved in the drilling programme but would become the go-to port for support services if the well proved viable.

However, it would take up to 10 years before production and extraction could begin, Gear said.

Austrian oil and gas company OMV was granted consent by the Environmental Protection Authority to carry out exploratory drilling on the Great South Basin in December.

Since the consent was based on a permit OMV obtained in 2007 – 10 years before the Government's decision to ban offshore exploration permits - the public weren't able to submit comment.

Protesters did, however, raise their fists during a hearing for a discharge consent held in Dunedin between July 30 and August 1, 2019.

South Port Chief Executive Nigel Gear. He's pictured here addressing shareholders at an AGM in 2017.

Environment Southland councillor Robert Guyton expressed concern when the drilling started.

'All the fossil fuel they extract will end up as in the atmosphere as gigatons of greenhouse gases,' he said.

Oil Free Otago and Extinction Rebellion Otepoti held a protest in Invercargill about OMV's plans last week.