Latest / Early Edition with Ryan Bridge / John Carnegie: Energy Resources Aotearoa CEO on the Government's first investments from the Gas Security Fund

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John Carnegie: Energy Resources Aotearoa CEO on the Government's first investments from the Gas Security Fund · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: Right, let's talk gas, shall we? First announcement from the
• 0:03
  Speaker 1: government's gas security fund. Todd Energy getting $ 23. 5 million in
• 0:07
  Speaker 1: government loans, another $ 16 million loan for the McKee gas cap.
• 0:11
  Speaker 1: 17 proposals still in the pipeline. John Carnegie, Energy Resources
• 0:16
  Speaker 1: Aotearoa CEO with us this morning. John, good morning.
• 0:19
  Speaker 2: Yeah, good morning, Ryan.
• 0:19
  Speaker 1: Hey, why does Todd need government loans? What's wrong with banks?
• 0:25
  Speaker 2: Well, Ryan, we've talked about this a number of times
• 0:27
  Speaker 2: now over the past couple of years. Look, ordinarily, we wouldn't.
• 0:32
  Speaker 2: But what happened to the petroleum sector during the previous
• 0:35
  Speaker 2: government was anything but ordinary. So this lending facility isn't
• 0:41
  Speaker 2: to help with everyday business risk. The sector can handle
• 0:45
  Speaker 2: that itself. It's more fundamental than that. The sector's investment
• 0:49
  Speaker 2: confidence was absolutely shattered yesterday. And they now effectively need
• 0:54
  Speaker 2: the government to walk a mile in their shoes to
• 0:57
  Speaker 2: mitigate the risk of the rules changing again and stranding
• 0:59
  Speaker 2: their investments. And of course, that's a very real threat,
• 1:03
  Speaker 2: as we've heard time and again from the Labour Party
• 1:05
  Speaker 2: during this very election campaign.
• 1:08
  Speaker 1: So without it, John, without the government holding their hand,
• 1:14
  Speaker 1: this would either be too expensive from a commercial banking
• 1:19
  Speaker 1: financing point of view or a non-starter.
• 1:24
  Speaker 2: Well, I think the very purpose of this scheme is
• 1:27
  Speaker 2: to bring forward gas production that would otherwise happen later.
• 1:33
  Speaker 2: So this is exactly what this lending facility will do.
• 1:38
  Speaker 1: I was interested to see how quickly actually some of
• 1:41
  Speaker 1: it could come on board because they're not new gas fields.
• 1:45
  Speaker 1: It's accessing stuff that's already there that we know about.
• 1:48
  Speaker 1: Is that right? That's why we can get it on
• 1:49
  Speaker 1: stream potentially by 2027.
• 1:53
  Speaker 2: Yeah, look, that's right. These loans they're using for the
• 1:58
  Speaker 2: use of existing fields and infrastructure. So they offer one
• 2:01
  Speaker 2: of the quickest opportunities we have to get more domestic
• 2:04
  Speaker 2: gas into the market sooner. And look, if they're successful,
• 2:09
  Speaker 2: which of course isn't guaranteed given the risky nature of
• 2:12
  Speaker 2: petroleum investments, both projects do expect to have gas flowing
• 2:16
  Speaker 2: by the end of 2027. And in our view, this
• 2:19
  Speaker 2: is a public-private partnership at its best.
• 2:23
  Speaker 1: John Carnegie, Energy Resources Altair. Good to have you on
• 2:26
  Speaker 1: the show this morning as always.
• 2:28
  Speaker 2: For more from Early Edition with Ryan Bridge, listen live
• 2:31
  Speaker 2: to News Talk ZB from 5 a.m. weekdays or follow
• 2:35
  Speaker 2: the podcast on iHeartRadio.