Mike Williams: Despite gripes, oil-gas move good for Naki, industry

Mike Williams

I missed writing a column last week and the reason was the wild weather which hit Auckland.

In the aftermath, several hundred thousand Aucklanders were left in the dark, and there were power outages at my home and office.

At the time of writing, a couple of thousand homes on the fringes of the city remained without power.

I can't remember anything like this storm in Auckland. It was a timely demonstration of climate instability and it followed hot on the heels of the Labour-led Government's statement on fossil-fuel exploration.

This announcement was that there would be no new offshore gas and oil exploration in New Zealand.

This was a lesson in the successful compromises necessary for a government to survive long term in an MMP/coalition environment.

Prime Minister Jacinda Ardern was able to begin delivering on the Labour Party's campaign pledge to make climate change this generation's "nuclear-free moment", the Green Party got its wish to see fossil-fuel power generation phased out over time and New Zealand First was able to claim that it had successfully defended provincial New Zealand.

New onshore exploration will be ring-fenced to Taranaki, though existing discoveries arising from previous exploration both onshore and at sea will be allowed to be developed.

Despite the griping from Taranaki and the oil industry, this announcement is good news for the province and the industry.

Companies whose business is oil and gas exploration will have to focus their spending onshore in Taranaki and the businesses which have already discovered and registered oil and gas prospects in this country will see an increase in the value of their finds.

The doomsayers who claim that we have only 10 years' worth of gas left are talking nonsense as there are massive prospects off the South Island coast already discovered and unaffected by the new policy.

Anyway, it's debatable whether another round of offers for prospecting licences would have produced any takers.

While on the board of the Institute of Geological and Nuclear Sciences, I got infected by the scientists' enthusiasm for offshore drilling and became optimistic about finding vast reserves of fossil hydrocarbons in our huge EEZ (exclusive economic zone).

However, back then, not much happened and it probably wouldn't now, had a new round of prospecting been announced.

As previous rounds of prospecting offers drew little interest from the big international players when the oil price was double what it is now, it's therefore unlikely there would be much interest when oil prices are low and fracking in the US has produced a gas glut.

For New Zealand, the announcement marked the beginning of a long journey towards the goal of becoming carbon neutral.

The objective is to reduce the volume of carbon dioxide in the atmosphere, the main cause of the global warming which is behind climate change.

New Zealand already generates about three quarters of its electricity from the renewable hydro, geothermal and wind sources but a quarter still comes from gas, coal and oil.

If we are to take the carbon-neutral goal seriously we'll also have to plan to produce enough electricity to power our huge transport sector, meaning all of the cars, trucks, buses, trains etc.

Although New Zealand is rich in renewable energy potential, we will nevertheless need a plan and a government-led strategy to expand these renewable sources.

While new hydro-electric projects of any size are unlikely to happen, New Zealand's position on the "Pacific Ring of Fire" means that geothermal energy prospects are huge and we should be paying close attention to Iceland's experiments in generating electricity directly from the plumbing of volcanoes.

Wind energy, which now produces 6 per cent of our energy needs, also has huge potential to expand as a source of generation and there must be offshore sites where wind farms could flourish in a similar way to Europe.

On an individual scale I've noticed many houses in Hawke's Bay now sprout solar panels and am delighted to note that Unison's idiotic strategy of taxing users who install solar panels has not caught on with other network managers and hasn't deterred its customers from grabbing a bit of free power.

Unlike some Australian states, there is no financial encouragement to invest in solar power and this may be something to be considered in any long-term government plan.

Looking deep into the crystal ball, the tidal energy potential of this country is enormous. I once read a paper on this energy source which, worldwide, is largely untapped and discovered that because of its position between oceans, New Zealand has three of the best tidal energy sites in Cook Strait, Foveaux Strait and off Cape Reinga.

Let's see a plan to wean us off fossil fuels soon.

• Mike Williams grew up in Hawke's Bay. He is CEO of the NZ Howard League and a former Labour Party president. All opinions are his and not those of Hawke's Bay Today.