A long-running, barely noticed and unscheduled cut in natural gas production from the Pohokura natural gas field is costing its main customer, methanol producer Methanex, around $2 million a day in lost revenue, with total revenue foregone in the last 13 weeks as much as $15m a week, says analysis from Wellington investment firm Woodward Partners.
"The current situation at Pohokura is one that is materially under-appreciated for its significance," said Woodward's energy industry analyst, John Kidd, in a second note to clients taking issue with government ministers' statements in defence of its decision to stop offering offshore oil and gas exploration licences.
"The simple current reality is that New Zealand's largest gas field, which normally meets 35-to-40 per cent of gas market demand, has a suffered a major unscheduled part-outage with no external visibility as to when a return to normal service can be expected."
That made the incident similar in scale to the gas pipeline break in 2011 that saw gas users throughout the upper North Island, including industries, electricity generators, and business and household consumers, on short rations while it was repaired.
"The 'crisis' as it rightly became labelled at that time became very heated in both public and political circles as headlines of widespread milk-dumping by Fonterra ... and cancellation of elective surgeries in Auckland hospitals and even idle crematoriums grabbing headlines," Kidd said.