New Zealand invests $20.3m in offshore gas projects to bolster supply

The Gas Security Fund supports supply when renewable sources are constrained.

New Zealand will invest $20.3m (NZ$36m) through its Gas Security Fund into two offshore gas exploration projects aimed at strengthening domestic energy supply, according to Resources Minister Shane Jones and Associate Finance Minister Chris Bishop.

The investments form part of the Gas Security Fund, which the government said is intended to support gas supply when electricity generation from hydro, wind, and solar is constrained.

The government will provide $12.1m (NZ$21.5m) through a time-limited equity arrangement for EnZed Energy’s Kaheru offshore exploration project in Taranaki.

The project has an estimated total cost of $40.1m (NZ$71m), with EnZed Energy seeking the remaining $28.0m (NZ$49.5m) from other investors.

Kaheru is targeting an estimated 182 petajoules of additional gas reserves, equivalent to nearly 25% of New Zealand’s proven and probable gas reserves as of January.

A further $8.2m (NZ$14.5m) will go to Schlumberger New Zealand to create the country’s first basin-scale offshore pseudo 3D dataset using seismic technology.

The project will combine existing public and private datasets covering the Taranaki, East Coast, and Great South basins, with the resulting datasets made freely available to potential explorers for two years.

Resources Minister Shane Jones said the seismic project would make subsurface exploration information easier for industry to access and interpret, whilst attracting international exploration companies to New Zealand.

(US$1 = NZ$1.77)