Kupe 'won't solve shortage'

The development of the Kupe oil and gas field relieves some of the pressure on supplies, but an energy analyst claims it will not solve New Zealand's shortage.

The joint venture by NZ Oil & Gas, Origin Energy, Genesis Energy and Mitsui E&P New Zealand plans to spend nearly a billion dollars on the Taranaki field to get it producing gas within the next three years.

Analyst Richard Hale says it is a much needed investment which will alleviate the supply shortfall but he says Kupe has long been factored into the supply-demand balance, so the country is still facing a supply crunch around 2015. He says Kupe is not a big field and is only about a tenth of the size of Maui. However, Mr Hale admits if Kupe had not come on stream, the shortfall in gas supply would have been exacerbated.

The mayor of South Taranaki, Mary Bourke, believes the development will bring great benefits to the region. She says the field will also utilise the region's excellent engineering skills.

Kupe is expected to begin production by mid-2009. The project will provide 15 per cent of New Zealand's gas needs as well as LPG and light oil.

- NEWSTALK ZB