Latest / Best of Business / John Carnegie: Energy Resources Aotearoa CEO 'unsurprised' by Genesis Energy slowing down gas production

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John Carnegie: Energy Resources Aotearoa CEO 'unsurprised' by Genesis Energy slowing down gas production · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from News Talks'd be follow
• 0:12
  Speaker 1: this and our wide range of podcasts now on iHeartRadio.
• 0:16
  Speaker 2: Genesis Energy has announced it's just going to give up
• 0:19
  Speaker 2: on the gas. They give it another five years. The
• 0:21
  Speaker 2: chief executive, Malcolm John's told of Parliamentary Select Committee he
• 0:24
  Speaker 2: no longer sees gas as a transition fuel and they're
• 0:26
  Speaker 2: just going to hit the coal instead. John Carnegie is
• 0:29
  Speaker 2: the chief executive of Energy Resources AULT here or and
• 0:31
  Speaker 2: with us now.
• 0:32
  Speaker 3: Hey John, Hey, how you doing.
• 0:34
  Speaker 2: I'm very well, thank you. This is a reflection that
• 0:36
  Speaker 2: we're running out of gas, right, That's the problem here,
• 0:38
  Speaker 2: isn't it.
• 0:40
  Speaker 4: Oh well, look, unfortunately what's been said isn't a great
• 0:43
  Speaker 4: surprise to us. And actually it's not that gas isn't
• 0:47
  Speaker 4: a viable transition fuel. It said, it's simply not coming
• 0:50
  Speaker 4: available to the market and the quantity is wanted and
• 0:52
  Speaker 4: Genesis is are saying that out loud, so you know,
• 0:56
  Speaker 4: these comments aren't actually anything more than a practical reflection
• 1:01
  Speaker 4: of the reality that major gas uses a facing right
• 1:03
  Speaker 4: across the economy. And I've been saying this for some time,
• 1:06
  Speaker 4: that we've got an energy shortage, and unfortunately this is
• 1:09
  Speaker 4: what an energy shortage looks like. When one of our
• 1:12
  Speaker 4: largest gas users says there's not enough gas for them
• 1:15
  Speaker 4: and we need to turn to coal to make electricity.
• 1:18
  Speaker 2: I mean they've gone to a deadline of twenty thirty,
• 1:21
  Speaker 2: which is alarmingly close. Is that realistic?
• 1:25
  Speaker 3: Well realistic in terms of what gus.
• 1:29
  Speaker 2: Like they're really going to stop doing gas in five
• 1:31
  Speaker 2: years time?
• 1:33
  Speaker 3: Well?
• 1:33
  Speaker 4: Look, you know, I think the frustrating thing about this
• 1:36
  Speaker 4: is that New Zealand actually has abundant natural gas that
• 1:40
  Speaker 4: can be harnessed to ensure a thriving economy and fueling
• 1:43
  Speaker 4: our manufacturers and exporters to deliver key wei jobs and prosperity.
• 1:46
  Speaker 4: It's just that, through a variety of policy decisions, gas
• 1:53
  Speaker 4: isn't coming to market, and you know, as you'd expect,
• 1:58
  Speaker 4: you know, Genesis is responding to those market signals.
• 2:02
  Speaker 1: What does this?
• 2:03
  Speaker 3: So?
• 2:04
  Speaker 2: Genesis is my provider, and I pay them for electricity,
• 2:07
  Speaker 2: and I also pay them for gas because the old
• 2:09
  Speaker 2: stove runs on gas. You know, cook on gas. What
• 2:11
  Speaker 2: does that mean? Am I not going to be able
• 2:12
  Speaker 2: to cook on gas in five years?
• 2:14
  Speaker 3: Oh?
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  Speaker 4: No, Look, I think there's plenty of gas. New Zealand
• 2:19
  Speaker 4: has lots of gas we just need.
• 2:21
  Speaker 2: Is Genesis going to continue to be my company then,
• 2:24
  Speaker 2: or are they not going to provide my gas?
• 2:27
  Speaker 4: Well, love, I mean you need to. They'll be engaging
• 2:31
  Speaker 4: with you as one of their customers. But we do
• 2:34
  Speaker 4: have plenty of gas.
• 2:35
  Speaker 3: We just need the right conditions to get it out
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  Speaker 3: of it.
• 2:36
  Speaker 2: So you don't know what this practically means about them
• 2:38
  Speaker 2: saying that they're going to give up on the gas
• 2:40
  Speaker 2: in five years, as to whether everybody who's got gas
• 2:43
  Speaker 2: provided by Genesis suddenly needs to find a new provider.
• 2:46
  Speaker 4: In terms of electricity generation, they are signaling that they
• 2:49
  Speaker 4: are going to rely on Colon. Good on them, You
• 2:52
  Speaker 4: know they are doing what they can. But I can
• 2:54
  Speaker 4: assure you that everyone would prefer to see domestic natural
• 2:58
  Speaker 4: gas filling the gap when we have low lake levels.
• 3:02
  Speaker 4: But it seem to be we seem to be doing
• 3:05
  Speaker 4: the reverse of what the rest of the world are doing.
• 3:07
  Speaker 3: We're going from the coal, not coal to gas.
• 3:10
  Speaker 2: That's pretty meantal Now they're talking about eventually converting Huntley
• 3:15
  Speaker 2: to instead of burning the coal, burning the wood waste.
• 3:18
  Speaker 2: Is this just pie in the sky nonsense that they
• 3:20
  Speaker 2: say to make us feel good? About it or is
• 3:22
  Speaker 2: that realistic?
• 3:24
  Speaker 3: No?
• 3:24
  Speaker 4: I no, that's some There are active, active plans to
• 3:28
  Speaker 4: have that happen, and they've they've said they're going to
• 3:31
  Speaker 4: work at pace to get three hundred thousand tons of
• 3:34
  Speaker 4: domestically produced by mass in place by twenty twenty eight. Yeah,
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  Speaker 4: but you know it is a budding market in New Zealand.
• 3:42
  Speaker 2: But did you say three hundred tons or three hundred
• 3:44
  Speaker 2: thousand tons?
• 3:45
  Speaker 3: Three hundred thousand tons.
• 3:47
  Speaker 2: I mean that's still nothing, is it?
• 3:48
  Speaker 3: Right?
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  Speaker 2: Though, They've got five hundred thousand tons of coal there
• 3:51
  Speaker 2: and they're ordering seven hundred and seventy thousand tons of coal,
• 3:54
  Speaker 2: So three hundred thousand tons of wood is sort of
• 3:57
  Speaker 2: just a tiny fraction.
• 3:58
  Speaker 3: Isn't it.
• 3:59
  Speaker 4: Well to put it into perspective, hither, it could in
• 4:02
  Speaker 4: a normal year, whatever a normal year now means in
• 4:05
  Speaker 4: an electricity market, it could a normal average year avoid
• 4:10
  Speaker 4: the use of coal. But in a dry year, of course,
• 4:14
  Speaker 4: Genesis could use three times.
• 4:15
  Speaker 2: I see what you mean?
• 4:16
  Speaker 4: Yeah that much. So you know the answer to that
• 4:19
  Speaker 4: question is you know, it depends.
• 4:21
  Speaker 3: Yeah.
• 4:22
  Speaker 2: Hey, John, thank you very much. I really appreciate you
• 4:24
  Speaker 2: talking us through it. As John Carnegie, the Energy Resources
• 4:26
  Speaker 2: out here at All Chief Executive.
• 4:28
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