John Carnegie: Energy Resources Aotearoa Chief Executive on government decision to reverse oil exploration ban

The Government will remove the 2018 ban on petroleum exploration beyond onshore Taranaki. 

The decision's being labelled a 'backwards step' by environmentalist groups. 

Energy Resources Aotearoa Chief Executive, John Carnegie, told Mike Hosking “In New Zealand, the ironic thing is coal has been a balancing energy fuel.” 

Carnegie said “There’s plenty of gas here, it’s just a matter of getting more explorers down here and having more wells drilled to find it.” 

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Episode Transcript

Speaker 1 (00:00):
Any government's confirmed, of course, that they're about to reverse
the twenty eighteen ban on oil and gas exploration. New
exploration will be allowed off the coast of places like
Taranaki and on conservation land. It will also allow for
small scale, non commercial gold mining. The amendment Bill will
be introduced to Parliament later on this year. Energy Resources
Chief Executive John Carnegie's back with this. John, very good
morning to you.

Speaker 2 (00:20):
Yes, good morning, Mike.

Speaker 1 (00:21):
Could we say, with the benefit of hindsight, what they
did back in twenty eighteen should never have happened.

Speaker 2 (00:26):
Yes, Well, what started off as climate leadership unfortunately ended
an energy chaos. Yeah. And actually the sad thing that
that mic is that it didn't need to. It was
entirely foreseable. You know, it's basic economics. If you squeeze
supply in the absence of economic alternatives, all you do
is lose jobs and investment, increase energy prices, you get

(00:50):
energy shortages, and you encourage fuel imports. And actually, in
New Zealand, the ironic thing here is that coal has
been the balancing electricity fuel and thank God for genusis
energy of course, but more broadly, the pathway we're on
if we can't recover domestic gas production, we'll end up
looking at olng imports in what a silly outcome for

(01:12):
New Zealand that would be.

Speaker 1 (01:13):
Exactly And going exploring though for gas and gas has
been the main talking point in the last couple of weeks,
given they gave us the supply issue. Do we know
there's gas there? It's just a matter of finding it
or do we not know? And it may well be
we explore and find nothing.

Speaker 2 (01:28):
Oh, I know in New Zealand's are long known as
being gas prone. There's putting a guests here. It's just
a matter of getting more explorers down here and having
more wells drilled to find it.

Speaker 1 (01:43):
Right, And so do we have a problem the way
Jones argues that we do reputationally speaking, that we've damaged
it and we need to resurrect it to get people
down here to start looking again.

Speaker 2 (01:54):
That's exactly right. You know we've got massive sovereign risk
created by the band and the government. Well actually, I
mean in terms of I guess your question is has
have the change has gone far enough? And you know
only time will tell, of course, because the band did

(02:15):
create severe damage to investment confidence and so obviously what
we need to do, because we haven't seen the detail
of the legislation will emerge over coming months. We'll have
a look at that and we'll make a judgment. And
actually it won't just be our judgment, critically, it will
be the judgment of investors, both the incumbents that we

(02:36):
have at the moment, because the are the ones who
are most likely to increase production quickly if if the
conditions are right, but also overseas investors.

Speaker 1 (02:44):
What do you say to that, I mean that it
seems to be the weird thing about this is I mean,
even if you're not a big fan of oil and gas,
I mean, the reality is that each and every winter,
transpower come up and say, cold morning, we've got trouble.
We don't produce. There's a massive gap between what we
need and what renewables can provide. And I would have
thought that's like we and all the green the greens
are still telling us that this is putting profit ahead
of people, it's putting the climate behind it. What do

(03:05):
you say to all those people who still don't seem
to get.

Speaker 2 (03:08):
It, Well, well they get it, they just get it
within their own terms of reference. I guess actually, I
mean from my perspective, Mike, we actually need to stop
having one dimensional binary conversations. We don't need to have
those to make progress on our climate goals. It's not
necessary to trade off the our energy security and affordability,

(03:29):
and frankly, imposing hardship and lowering living standards isn't a
solution in our view. Look, we can have more gas
and achieve it's an end and achieve our climate goals
because more natural gas will help underpin the greater development
of renewable sources of electricity. It will stop the important coal,

(03:52):
it'll encourage by keeping downward pressure on electricity prices, that
will encourage the decarbonization of transport. So that pretty solid
environmental chops. To be honest, Actually, even our Climate Change
Commission thinks we can produce more guests relative to their
pathway and what we're currently producing. So there's even they

(04:13):
think that we can still meet our targets with more
guest production.

Speaker 1 (04:16):
Very well, So, John, good to have you on the program.
Appreciate John Carnegie. Indadew Resources out here are chief executive.

Speaker 2 (04:22):
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