New Zealand households which rely on natural gas won't have to switch to another energy source despite the latest advice showing there may be as little as seven years' reserves left, the Government says.
Energy Minister Megan Woods said today she expected New Zealand's shift away from fossil fuels to take 30 or 40 years because existing exploration permits would allow further drilling for gas.
Speaking to TVNZ's Q+A about households moving away from gas, Woods said: "We're still talking drilling for oil and gas in New Zealand in the 2030s and 2040s. So no one has to rush out and do it tomorrow".
Advice to the minister from oil and gas companies Shell and OMV said New Zealand's existing gas reserves would last for between seven and 11 years.
When the Government announced its ban on new oil and gas exploration last week, it cited the higher number. Woods said that was not being misleading.
"Seven to 11 is often the figure that's put out there," she said. "I think that's probably a pessimistic figure."
There have been no new gas finds in New Zealand in 12 years. Some in the oil and gas industry say the ban on new exploration will reduce the chance of new discoveries because much-needed foreign investment in the sector will dry up.
Woods said that based on industry estimates, there was significant potential for new finds from existing gas exploration permits.
"What we know is that there's 100,000 square kilometres of New Zealand that is currently under exploration permits.
"You'd probably look at a 10 per cent to 15 per cent chance is what the industry would say of actually finding something. That gives you 10,000 to 15,000 square kilometres that would be available for exploration."
She said companies had put a lot of work in before they gained an exploration permit, so they were likely to pursue it. Permits could also be passed on to other firms.
The minister will travel to Taranaki tomorrow to speak to gas exporter Methanex, which uses about 46 per cent of New Zealand's natural gas.
The company has expressed disappointment at the end of exploration permits and what it believed was a lack of consultation on the new Government policy.
A Methanex spokeswoman said the ban would not affect gas production in the short-term but would have "significant implications" for long term gas supply and electricity security in New Zealand.
"We strongly believe that natural gas has a global role to play in reducing emissions and a transition to a lower-carbon economy, and that the continued production of methanol in New Zealand plays a positive role in this transition."