Bruce Aitken: former CEO and president of Methanex voices support for Government's plan to invest more into gas

The Government's bid to bring hope back to New Zealand's gas sector has been met with approval from industry experts.

In the Budget, the Government said it would set aside $200 million over four years for co‑investment in new gas fields.

Former CEO and president of Methanex, Bruce Aitken, says this is a good idea.

"Anything that encourages exploration for natural gas is great - it's a real pity that the Government has to do it, but I think there's an inevitability that you need to take some risk out of exploration."

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Episode Transcript

Speaker 1 (00:00):
Now the budget has put two hundred million dollars into
gas exploration. The money is going to be used to
take a ten to fifteen percent commercial steak in oil
fields and gas fields. Rather. Former CEO and president of
method X Bruce Aken is with.

Speaker 2 (00:11):
Us, Hey, Bruce, oh good, have there good evening?

Speaker 1 (00:13):
Is it a good idea?

Speaker 2 (00:16):
Yes? I think it is. Anything that encourages exploration for
natural gas is great. It's a real pity that the
government has to do it. But I think there's an
inevitability that you need to take some risk out of exploration.

Speaker 1 (00:30):
I mean, obviously what it's going to Well, the point
of this thing is to kind of put the governments
a bit of skin in the game and then encourage
the investors and say we're not going to get rid
of it because we now have money in it ourselves.
But surely it's only the things that we have money in, right,
Everything else is still at risk, isn't it.

Speaker 2 (00:46):
Yes? It is. The big issue here is maintaining the market.
And when you think back to where those plants in
Taranniki came from, they were created to create a market
for natural gas, and out of that then you get
natural gas for dairy natural gas for electricity generation, natural
gas that comes through our homes. So natural gas is

(01:08):
an incredibly useful product. You know, the rest of the
world is meeting their climate change challenges by getting out
of coal and internatural gas. What we've done in New
Zuand is exactly the opposite. We've put a big dampner
on natural gas exploration and importing record quandities of coal

(01:29):
to keep the lights on over winter. So it makes
zero sense what has happened over the last five years.

Speaker 1 (01:35):
Would two hundred million dollars be enough because I would
imagine that would be just enough to buy a ten
percent steak in perhaps one exploration, isn't it.

Speaker 2 (01:43):
Yeah, it's not a lot of money in that industry,
and it could well be it's too little, too late,
But I think at least it's an effort to try
and address what is a I think is a desperate
problem for our country.

Speaker 1 (01:54):
So we were talking. I was talking to somebody about
this in the budget lock up, and they the point
that they made is we haven't found any new gas
in twenty years, and what gas we have found has
not turned out to be viable in terms of putting
your money into it.

Speaker 2 (02:06):
Is that right, Well, that's not entirely true. I think
New Zealand is gas prone. So if you've drill enough holes,
you're going to find more gas. When you found big
fields like Maoy, like Poakura and there are other meaningful
fields around the Taraniki basin, there will be more gas
out there. It's just a matter of having a well

(02:28):
planned program over a number of years. And that's the
problem with this industry. There's a very long timelines. You
spend a lot of money and then you need a
market for the gas at the end of it. And
it's only when the government kind of steps in and
takes shoulders some of that risk that perhaps you can
tempt others back into that space.

Speaker 1 (02:48):
Okay, so is this enough to tempt others back into
the space? Is this enough to get somebody to take
ninety percent with the government?

Speaker 2 (02:55):
Well, I guess we'll find out. Like it probably isn't
It's better than nothing.

Speaker 1 (03:02):
Yeah, Hey, thank you so much, Bruce, really appreciate it.
Bruce Acan, former CEO and president of Methodics.

Speaker 2 (03:07):
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