Past Policy Choices Coming Home To Roost
For yet another year, the Ministry of Business Innovation and Employment (MBIE) data published today shows that estimates for New Zealand's gas reserves are rapidly declining.
There has been a 27 per cent year-on-year reduction in natural gas reserves, dropping to 948 petajoules from 1,300 in 2024, which was 20 per cent down on the previous year. Production is now forecast below 100 PJ by 2026, rather than 2029, as previously forecast.
Energy Resources Aotearoa Chief Executive John Carnegie says the $200 million Crown co-investment in new domestic gas projects, the removal of the 2018 exploration ban, and changes proposed through the Crown Minerals Amendment Bill are all great signs that the Government is working hard to turn the corner on the deindustrialisation of the New Zealand economy.
"We acknowledge the Government is moving to support the strong potential of our domestic gas supply. But only time will tell if this will be enough."
Carnegie says the ongoing challenges with gas supply underscore the urgent need for proactive measures to secure energy stability and support New Zealand's economic resilience.
"We know there are still prospective fields out there - now we need to see the right conditions continue so that we can unlock the supply.
Kiwi businesses are doing it tough as gas supply becomes further constrained. We desperately need more natural gas in the market to ensure electricity is available to keep the lights on and our export economy thriving."
Currently, we're witnessing the consequences of a shrinking domestic gas supply: higher prices, the use of imported coal, and uncertainty for industrial users, Carnegie says.
"Natural gas plays a critical role in supporting renewables, powering industry, and keeping energy affordable and reliable.
Gas production projects underpin everything from electricity to industrial manufacturing. If we don't continue to work hard on securing more domestic gas for New Zealand, we risk higher prices, more imported coal use, and further instability."
If New Zealand can get this right, the benefits are enormous: jobs, royalties, export earnings, and the confidence of regional businesses to expand, knowing they have secure and affordable energy for the future.
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