Oil lobbyist - between bedrock and a hard place

Chief executive of the Petroleum Exploration and Production Association David Robinson believes the industry offers the most realistic energy option. Photo / Steven McNicholl
Chief executive of the Petroleum Exploration and Production Association David Robinson believes the industry offers the most realistic energy option. Photo / Steven McNicholl

The new head of a reinvigorated oil and gas lobby has a hard sell on his hands.

Just as the petroleum industry is gearing up to push its views on oil exploration harder, so are an equally determined environmental movement and a Green Party which is riding high in the polls.

David Robinson also has to help sell the New Zealand story to major global explorers who have the option of more accessible and proven oil and gas basins.

He took over early this year as the head of the Petroleum Exploration and Production Association and from the outset has been generous about environmental lobbyists.

"I absolutely acknowledge the green movement for changing the way we view the world and how every industry operates. We have a tremendous amount to thank them for and I think most of us share the ideology."

Robinson loves the outdoors, sympathises with anyone with a big oil or gas operation nearby and acknowledges some explorers have got it wrong on the ground in New Zealand.

And he would love a clean, green energy discovery to supplant hydrocarbons. But that's where reality kicks in for him.

"It's a matter of marrying up the ideology with the practicality. What we might all agree is that we do not want to live with oil and gas, that's a choice we'd all make if we could but the cost of doing that is our lifestyle today. It's about being able to turn on a light or go to a hospital if you're sick."

World demand for energy is growing at a rate faster than the development of renewable energies.

He believes that unless there is some incredible energy breakthrough, oil and gas will continue to be the primary fuel to meet demand for at least the next 50 years, possibly longer.

"It would be fabulous if New Zealand had a green-based economy but the idealism - which I share - meets with a certain reality. We don't have those industries right now and every other part of the world is also trying to develop those industries too."

New Zealand was not spending enough on science and technology to create the best opportunity to steal a march on the rest of the world, he said.

Robinson, 42, worked for Shell for 13 years and looks enviously at the Australian "can-do attitude" to energy projects. Massive gas field developments meant that within the next 10 years Australia could become the biggest exporter of energy in the world, he said.

The father of 10- and 12-year-old boys has one main goal for Pepanz: "I'd like to see a doubling of the amount of exploration we're doing in New Zealand, I'd like to see the sector contributing a lot more to New Zealand. The effect of that is seeing the economy improve so my boys don't inherit a debt like the Greeks have got."

Last year the industry paid around $1 billion in direct taxes and royalties alone. That was a $50 million reduction from the year before as the offshore Tui and Maari field production was crimped.

Robinson says the capacity for New Zealand's oil and gas industry to dig us out of an economic hole is enormous, given the area of our Exclusive Economic Zone. But it's those harder-to-reach deepwater fields that generate the fiercest opposition.

A challenge to Brazilian oil giant Petrobras' application to explore in deep water off East Cape is due to be heard in the High Court today, in what could turn out to be a landmark case.

Robinson said the Gulf of Mexico Deepwater Horizon tragedy, in which 11 workers died, was unusual.

"The reality is that it shouldn't have happened but there are a tremendous number of lessons that have been learned from that," he said.

"It's never going to be risk-free. Life is a risky business, but they can be assured there are decent New Zealanders working to minimise the risk."

In 2010, Pepanz highlighted a shortage of rig inspectors and the Wellington-based organisation is working with the Government on codes of conduct for hydraulic fracturing and iwi engagement.

Early this year, Pepanz announced a revamped board comprising the most senior New Zealand-based person of each major explorer and producer as well as senior associate members. It has beefed up its staffing levels and is throwing its weight behind the inaugural New Zealand Petroleum Summit.

The industry not only has to deal with opponents here, it needs to make itself highly visible to big players overseas.

The scale of the investment required to tap into oil and gas is beyond domestic operators. New Zealand suffers from its isolation and a track record of gas-rich, rather than oil-rich discoveries.

"There are moderate amounts of exploration going on onshore at well-proven locations in Taranaki, there have been some good little finds, but not world-beaters," Robinson said.

Bringing a very big offshore field into production could take at least seven years. An offshore drilling programme costs about $100 million to get started here.

"When they talk about risk they talk about [losing] all their dough. You can only use equity to drill wells, you can't borrow money for it - you need cash," Robinson said.

"Last summer there was no drilling offshore - the only way to find oil is to drill. You can have promising seismic data but it's the exploration wells that tell you what's going on."

Robinson is only too happy to tell the New Zealand oil story and there's one topic that really gets him going: "Fracking is the word du jour for people who are anti-oil and gas and there's nothing more to it than that," he says.

The technique has been used here on a limited scale for more than two decades but opposition has built in the United States and been galvanised by the controversial documentary Gasland.

"It's a social reaction to the incredible scale that shale gas has taken on in the US."

Robinson travels with a USB stick that explains the process.

A solution of about 98 per cent water and sand travels down a 12cm pipe for about 60 minutes to make fractures the size of a drinking straw - often kilometres down - and allowing oil and gas to move through it.

He doesn't buy claims that fracking causes earthquakes, but concedes he wouldn't like a big US-scale operation next to his property if he lived in the country.

While opposition to the oil industry in Taranaki is puzzling given its presence there for over a century, he says he can understand the reaction on the other side of the island where North American firms TAG and Apache have vast acreage that may be fracked and water supply is an issue.

"I think you've got a slightly different situation in the East Coast. I think it is a case of oil companies not engaging early enough with local communities."

Robinson didn't grow up in Wanganui aiming to be an oil business leader, but he's a staunch defender.

"The spotlight going on oil and gas is going in the wrong places - look at the environmental impact of any urban location," he says. "People make a mess."

- NZ Herald

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