John Carnegie: Energy Resources Aotearoa CEO 'unsurprised' by Genesis Energy slowing down gas production

Genesis Energy has confirmed it plans to shift its focus over to coal, as gas production declines and no other suitable sources have been found.

Genesis has made clear it sees a declining role for gas in electricity generation - despite the Government's attempts to get offshore oil and gas exploration going properly. 

Energy Resources Aotearoa CEO John Carnegie isn't surprised by this - given the associated challenges. 

LISTEN ABOVE

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:00):
Genesis Energy has announced it's just going to give up
on the gas. They give it another five years. The
chief executive, Malcolm John's told of Parliamentary Select Committee he
no longer sees gas as a transition fuel and they're
just going to hit the coal instead. John Carnegie is
the chief executive of Energy Resources Altered or in with us.

Speaker 2 (00:15):
Now, Hey, John, Hey, how are you doing.

Speaker 1 (00:18):
I'm very well, thank you. This is a reflection that
we're running out of gas, right, That's the problem here,
isn't it.

Speaker 2 (00:23):
Oh well, look, unfortunately what's been said isn't a great
surprise to us. And actually it's not that gas isn't
a viable transition fuel. It's said it's simply not coming
available to the market and the quantity is wanted, and
Genesis is are saying that out loud, so you know,
these comments aren't actually anything more than a practical reflection

(00:44):
of the reality that major gas uses are facing right
across the economy. And I've been saying this for some time,
that we've got an energy shortage, and unfortunately, this is
what an energy shortage looks like. When one of our
largest gas users says there's not enough gas for them.
And we need to turn to to make electricity.

Speaker 1 (01:02):
I mean they've gone to a deadline of twenty thirty,
which is alarmingly close. Is that realistic?

Speaker 2 (01:08):
Well, realistic in terms of what gus.

Speaker 1 (01:12):
Like they're really going to stop doing gas in five
years time?

Speaker 2 (01:16):
Well, look, you know, I think the frustrating thing about
this is that New Zealand actually has abundant natural gas
that can be harnessed to ensure a thriving economy and
fueling our manufacturers and exporters to deliver key we jobs
and prosperity. It's just that, through a variety of policy decisions,

(01:36):
gas isn't coming to market, and you know, as you'd expect,
you know, Genesis is responding to those market signals.

Speaker 1 (01:45):
What does this? So Genesis is my provider and I
pay them for electricity, and I also pay them for
gas because the old stove runs on gas. You know,
cook on gas. What does that mean? Am I not
going to be able to cook on gas in five years?

Speaker 2 (01:57):
Oh? No, Look I think is there's plenty of gas.
New Zealand has lots of gas we just need.

Speaker 1 (02:05):
Is Genesis going to continue to be my company then?
Or are they not going to provide my gas.

Speaker 2 (02:10):
Well, love, I mean you need to. They'll be engaging
with you as one of their customers. But we do
have plenty of gas. We just need the right conditions
to get it out of it.

Speaker 1 (02:20):
So you don't know what this practically means about them
saying that they're going to give up on the gas
in five years as to everybody who's got gas provided
by Genesis suddenly needs to find a new provider.

Speaker 2 (02:29):
In terms of electricity generation, they are signaling that they're
going to rely on coal, and good on them. You
know they are doing what they can. But I can
assure you that everyone would prefer to see domestic natural
gas filling the gap when we have low lake levels.
But seem to be we seem to be doing the
reverse of what the rest of the world are doing.

(02:50):
We're going from to coal, not coal to gas.

Speaker 1 (02:53):
That's pretty mental. Now they're talking about eventually converting Huntley
to instead of burn the coal, burning the wood waste.
Is this just pie in the sky nonsense that they
say to make us feel good about it, or is
that realistic?

Speaker 2 (03:07):
No? I know that's some There are active, active plans
to have that happen, and they've they've said they're going
to work at pace to get three hundred thousand tons
of domestically produced by mass in place by twenty twenty eight. Yeah,
but you know it is a budding market in New Zealand.

Speaker 1 (03:25):
But did you say three hundred tons or three hundred
thousand tons?

Speaker 2 (03:28):
Three hundred thousand tons?

Speaker 1 (03:30):
I mean that's still nothing, is it right? They've got
five hundred thousand tons of coal there and they're ordering
seven hundred and seventy thousand tons of coal, So three
hundred thousand tons of wood is sort of just a
tiny fraction, isn't it?

Speaker 2 (03:42):
Well to put it into perspective, Hither, it could in
a normal year, whatever a normal year now means in
an electricity market, it could an a normal average year
avoid the use of coal. But in a dry year,
of course, Genesis could use three times. I see what
you mean that much? So you know the answer to
that question is you know it depends.

Speaker 1 (04:04):
Yeah, Hey, John, thank you very much. I really appreciate
you talking us through it. As John Carnegie, the Energy
Resources out here all chief executive.

Speaker 2 (04:11):
For more from hither Duplessy Allen Drive, listen live to
news talks.

Speaker 1 (04:15):
It'd be from four pm weekdays, or follow the podcast
on iHeartRadio