NZ Gov't Flushes $200M Down the Toilet

A token, futile, feel good gesture?

Remember this?

What has changed is that all the extra drilling hasn't turned up much extra gas in the past few years. This is despite record amounts spent on new wells - nearly $1.3 billion between 2020 and 2024. Energy companies now think there's less gas than previously thought. Source

$200 Million Dollars Flushed down the Toilet

The New Zealand government is providing financial support for new offshore gas field developments, allocating NZ$200 million over four years to co-invest in these projects. This move reverses a previous ban on offshore oil and gas exploration and aims to revitalize the sector and address concerns about energy security and declining domestic reserves.

Here's a more detailed breakdown:

• Funding Allocation:

  The government has earmarked NZ$200 million for co-investment in new gas field developments.

• Purpose:

  The funding is intended to attract private sector investment, restore investor confidence, and ensure that new projects proceed without undue risk to private partners.

• Reversal of Policy:

  This initiative follows the government's decision to reverse a ban on offshore oil and gas exploration that had been in place since 2018.

• Energy Security Concerns:

  The move is partly driven by concerns about New Zealand's energy security and the need to address declining domestic gas reserves.

• Economic Considerations:

  The government also highlights the economic contributions of the petroleum and resources sector, including its impact on GDP and regional employment.

• Legislative Changes:

  The government is also pursuing legislative changes, such as the Crown Minerals Amendment Bill, to reduce red tape and facilitate resource development projects.