Kerre Woodham: Will we see the return from NZ First's proposal?

New Zealand First had its own little party on the weekend. It's going to campaign on funding a $1 billion survey of offshore oil and gas reserves that it says would lead to the country owning its own supply and reducing power prices. Hello, 1972!

However, it is unclear how many years it would take for Kiwis to feel the benefits, if any, as Winston said it was expected it could take six years just to establish a pathway forward.

Party leader Winston Peters announced the policy in his speech to the faithful in Auckland as he launched New Zealand First's 2026 election campaign. Same old, same old election-kind-of bag from Winston. He attacked Labour and the India free trade deal. That's what he does in election years.

He's a perfectly capable and competent Foreign Affairs Minister, dealing with all people from all parts of the world until election year. And then it's hoots, wahay, and he's off. He's perfectly capable of forming a coalition government with Labour and, despite the attacks on Labour, still could, but that's what he does in election years.

Back to the oil and gas. Can we make money out of oil and gas? If we have it, we can, but proven natural gas reserves within our economic zone have fallen by roughly two-thirds since 2021. Despite nearly $2 billion invested in new well drilling since the 2018 offshore exploration ban, results have been pretty modest.

So far, it's all a bit pie in the sky. Does the world still need more oil and gas?

If you listen to the Greenies, no. We're all sort of pedalling our way to work on our windmill-powered velocycles, everybody's got solar panels on the roof, and we're living in a utopian paradise where everything's clean, green and renewable.

But if you look at the facts and figures, if we can find oil and gas right now — in fact, even in six years — we could sell it.

A story trumpeting the decline of fuel consumption in Norway — where EV sales are approaching 100% of total car sales, resulting in a fall in domestic consumption of petrol and diesel — fails to mention that while Norway's consumption of oil and gas has plummeted, it's still flogging it off to the rest of the poor schmucks who have to use oil and gas because they don't have Norway's wealth to subsidise EVs. And Norway has that wealth because it's flogging off oil and gas.

They can afford to be clean and green because they're selling the stinky stuff to poorer people, which is just the way it goes for a lot of green households. You have to be really, really rich to be a Greenie, or really, really poor. Middle-class people haven't got a show.

The exports haven't fallen off in recent times. And if you look at peak oil predictions, peak oil was forecast back in the 1880s in the US when the Pennsylvania oil fields were exhausted. That's it — no more oil. Well, in fact, there was.

Then there was a scientific prediction of peak oil, made in 1956 by a geologist working for Shell who used actual science to predict that US domestic oil production would peak between 1965 and 1970, and that proved remarkably accurate. He then applied the model to global reserves, predicting worldwide peak oil production would occur around the year 2000.

However, he wasn't taking into account that methods would change and evolve during that time. The advent of fracking and shale oil has drastically altered the dynamics. Production capacities continue to evolve as new ways of finding oil and gas emerge. And why? Because there is a market for them.

I've heard a lot of people dismissing it as pie in the sky, "old man shouts at sky", and all that sort of stuff, and you can certainly accuse New Zealand First of that in many of its policies.

On this one, though, well, if we can get it — and that's a big if — and if we can get it relatively inexpensively, such that we turn a profit, then there may be an argument.

We could probably get oil and gas if we threw every last cent we had at getting it out there. Would it be economic? Possibly not.

It's got to be economic, and it's got to be there. If it is, we'll have a market.

Is it worth New Zealand Inc becoming oil prospectors? At the moment, we get around 42% back when we grant a licence. I don't think we should be in the business of prospecting ourselves. It's too risky. High risk, high return — that's not what we're about.

Sell the licences, let private companies put up the money, and let's clip the ticket on the way through. I'm all good with granting the licences. The market is still there as we evolve.

Look what happens when you turn off the tap abruptly. You've got businesses closing their doors, manufacturing plants shutting down, and people losing their jobs because that continuity of supply simply wasn't there. Ideology trumped pragmatism.

So while we evolve towards our windmill-powered velocycles to get to work, grant the licences, but let's not go oil prospecting ourselves.

Your thoughts?

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