By OGJ editors
HOUSTON, Nov. 24 -- According to a recently released study, New Zealand is having to cope with an ever-tightening natural gas market in a scenario reminiscent of that currently facing North America.
Calgary-based Tag Oil Ltd. reported the release of the in-depth study, New Zealand Gas—Meeting the Challenge, which "examines the impacts of the country's escalating gas demands and its effects on the oil and gas exploration industry."
"New Zealand is facing an energy predicament similar in many respects to that faced in North America: rising prices, dwindling supplies and increased consumption," said Tag Oil Pres. Drew Cadenhead.
"The Maui field is the principal source of New Zealand's natural gas and like many of America's gas fields, it was discovered over 30 years ago and is now nearing depletion." Based on the report, independent US engineering group Netherland Sewell & Associates confirmed that the giant Maui field, which had been supplying 80% of the New Zealand's oil and gas needs, is rapidly depleting.
"With demand vastly outpacing supply, gas prices have jumped over 300%. It is an environment that lends itself well for junior explorers with good prospects," Cadenhead said.
Meanwhile, New Zealand's economy has created a 2%/year increase in electric power demand over the last 10 years and natural gas-fired electric generation has increased 5%/year. "Today, half of all gas produced in the country is used for electricity," the study said.
"The depletion of Maui comes at an inopportune time for New Zealand energy consumers but at a perfect time for explorers. Energy demand is forecasted to rise by 18% between now and 2025, and the economy will falter if new gas supplies are not found." Cadenhead concluded.