Enlivened
industry as 21 petroleum firms compete for onshore and offshore exploration
any
of New Zealand’s ministers wear several hats, which may seem at
odds with a job that ostensibly requires a solid grasp of one subject,
let alone several different ones. Yet, this multi-tasking does ensure
government ministers gain a clearer overview of the economy.
Paul Swain is one such minister. He has the communications, IT and commerce
portfolios, as well as that of associate minister of energy, but it
is a challenge
he relishes.
Mr Swain is set to announce the successful applicants for 26 new onshore
and offshore exploration blocks in the Taranaki Basin. Some 41 bids
were received from 21 petroleum exploration companies. The adjacent
Deepwater Taranaki Basin area is also to be put up for another bidding
round later this year.
“I
am extremely pleased that there has been such strong competition for
most blocks,” he says. “This is a reflection of the keen interest
that there is in New Zealand as a place to explore for oil and gas reserves.”
New Zealand was recently ranked the 17th most attractive country in
the world for petroleum exploration investment by the IHS Energy Group’s
international survey – the highest ranking that the country has
ever achieved.
The onshore Taranaki blocks cover an area spanning 1,528 sq km and are
close to other fields currently producing oil and gas, as well as the
recent discoveries at Rimu/Kauri. There are also six offshore blocks
covering 6,700 sq km.
State
electricity was broken up to allow greater competition
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Jackson
‘Need
for sustainability – Maui will run dry in six years and
Kupe in 20’
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Power
companies are, needless to say, anxious that new discoveries will be
made. Reserves in the Maui gas field, for example, which provides 77
per cent of New Zealand’s natural gas, are going to run out within
six years at the current rate of consumption.
State-owned Genesis
Power is not alone in this period of anxious waiting for a new strike;
it recently increased its shareholding in the Kupe field from 50 to
70 per cent.
Chief executive Murray Jackson
says: “It’s a big leap forward for the future sustainability
of the company as Maui will run dry in six years. There is a need for
a replacement and the Kupe gas field (offshore of North Island) looks
to have a 20-year life.”
Genesis
was created when the state Electricity Corporation was broken up to
allow greater competition in the power generation and distribution business.
It started its new life with a gas and coal- powered station and other
generating assets now include hydro-, thermal-, biomass- and wind-powered
plants.
In August 2001, Genesis acquired the Natural Gas Corporation’s
retail electricity business. With its 288,000 customers on North Island,
Genesis now manages 450,000 electricity and 105,000 gas accounts. Most
customers live on the North Island, with a sprinkling on the South Island.
The company made post-tax profits of $59.9 million for 2000-2001, from
total revenues of $535 million. Last summer it opened a new, state-of-the-art
customer service contact centre in Hamilton and SITEL New Zealand Limited
was chosen to provide the service.
New gas finds would be very timely for Genesis, which is currently examining
a new proposal to build a 400MW high-efficiency combined-cycle gas-turbine
power plant within its existing 1,000MW Huntly thermal-power station
site in the north of North Island.
Genesis
Energy, the retailing division of Genesis Power, was acutely aware of
the need to reduce customer service costs. “The relationship with
SITEL gives us the opportunity to work with a global player,” says
Mr Jackson.
About a third of Genesis Power’s generating capacity is produced
from water and its three hydropower stations are all located on the
North Island. A drought which hit North Island earlier this year still
has lingering effects, but Mr Jackson says: “With a strong generation
portfolio, Genesis can provide energy in both and wet periods.
“We are active in exploring alternative renewable energy, such
as wind power and biomass, and we liaise with a number of countries
around the world in this area,” adds Mr Jackson.
Everyone
agrees that nothing should compromise the beautiful scenery
Combining power stations with New Zealand’s
stunningly beautiful scenery can be difficult – everyone agrees
that power is necessary and everyone also agrees that nothing should
be done to compromise the country’s best features. Genesis is committed
to achieving the best balance possible.
Last year, the company published its first environmental report, ‘Listen
and Respect’. A key element of the publication is the drive to
further enhance energy efficiency.
Genesis is helping to create a sustainable environmental management
centre near Rotorua and it has been working on a range of educational
initiatives. It also funds a number of scholarships in the environmental
field.
The
further development of new, large hydropower stations is limited as
demand for retaining rivers in their natural state grows. For the Maoris,
many of the country’s rivers, such as the Waikato on the South
Island, which is central to Genesis’s Huntly hydropower plant,
are sacred and highly symbolic. Cooling towers at the plant avoid the
discharge of additional heat into the river.
All power companies face the same difficulty: how do you increase power
generation and at the same time minimise the impact on the environment?
The arguments continue to exercise the minds of the public, environmentalists,
industry and politics.