Contact Energy's gas storage project will hit a milestone tomorrow with the arrival of a huge compressor to pump gas into the Ahuroa field.
The compressor fills three shipping containers and will arrive with two 100MW turbines for Contact's Stratford peaking power station, which is being built in conjunction with
the Ahuroa project.
Each project is costing $250 million.
The Ahuroa is a near-depleted gas reservoir around 3km deep and 2km long in an area of porous rock surrounded by non-porous rock.
Through a combination of new gas, compression and new wells, the reservoir will be repressured and able to store gas until it is economic to use it.
The system is used overseas but this is the first time it has been used in this country.
Relatively cheap Maui gas contracts have run their course and Contact is faced with increasingly onerous take or pay arrangements. The company spends about $400 million on gas a year and has little ability to bank it.
Maui was a world-scale field with unlimited flexibility at no cost but the company said newer fields had not been designed to provide flexibility and all gas was essentially the same price.
Contact estimates that about 10 per cent of all power generation will come from wind by 2015. The other, mainly thermal, baseload will back off when the wind is blowing and require fast- start capacity when it is not.
New Zealand has little existing fast-start capacity and the company says thermal flexibility is critical to meeting that need.
