New Zealand will need more gas discoveries even though the Government had set a target of generating 90% of electricity from renewable sources by 2025, the Minister of Energy the Hon David Parker told the New Zealand Petroleum Conference.
Mr Parker said the new energy strategy introduced last year did not mean all 'doom and gloom' for the petroleum sector as he had heard from some industry players.
He said the relative economics of gas against coal will improve under the emission trading scheme.
"There is still going to be a demand for gas for supplies for domestic, industrial, and also for the existing gas fired power generation needs."
The recent introduction to Parliament of an Electricity Act amendment would create a 10-year restriction on construction of baseload thermal generation above 10 MW whose fuel source was more than 20% fossil fuelled.
"However fossil fuels, especially gas, will continue to have a critical role for some time to come. They provide security, versatility and stability in the delivery of electricity." Mr Parker said.
Associate Minister of Energy the Hon Harry Duynhoven earlier told the conference that once the Tui, Maari, Kupe, and Pohokura projects reached production by about 2010 they would bring 140 million barrels of new reserves to the market.
New Zealand's oil production would then be at record levels, Mr Duynhoven said.
He said he is expecting a good outcome from the Crown Minerals onshore Taranaki blocks offer opened late last year. He anticipated companies would bring with them the type of experience required to unlock Taranaki's under explored gas plays.
The next blocks offer later this year will be the offshore Raukumara Basin, he said. Preliminary analysis of the recent seismic data acquisition in the unexplored basin, which lies north of East Cape in the North Island, has significantly strengthened earlier confidence in the existence of a petroleum system, he said.
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