$2000M energy plan

Press, 26 May 1979, Page 1

$2000M energy plan

PA Wellington Proposals for producing and marketing Liquefied Natural Gas (L.N.G.) from the Maui field have been developed by Shell and put before the Minister of Energy (Mr Birch), according to the company last evening.

The project, which would cost more than S2OOOM, was seen as the key feature in planning for the maximum use of Maui gas, the company said. The proposals, subject to detailed studies and a feasibility report, include building another offshore platform, expanding production facilities associated with the field, and carrying gas over an extension of the existing pipeline to Huntly on to Auckland, and from there to a point

near Whangarei where a big L.N.G. plant would be developed. It would be necessary to build at least four specialised gas carrier ships, each with a capacity of 125,000 cu m to transport the L.N.G. to overseas markets, Shell said. Mr D. H. Tudhope, chairman of Shell in New Zealand, said that in developing the proposals Shell had taken particular account of New Zealand’s over-all energy reserves, which have been greatly increased in recent years by extra hydro and geothermal electricity generation capacity and the discovery of big coal deposits, as well as the recognition of increased gas reserves at Maui and Kapuni. Awareness had grown of

the scope for a substantial energy project without risk to the “paramount consideration” of New Zealand’s own energy requirements for the foreseeable future, Mr Tudhope said. The proportion of gas to reserves being dedicated would be no greater than that already dedicated in the Maui agreement. The implementation of Shell’s proposals for an L.N.G. project would bring great benefits to New Zealand in two principal ways, the company’s statement said.

Self-sufficiency in transport fuels would be increased because the greater gas production would enable much more recovery of condensate, as well as the early production of some quantities of crude oil

known to exist in another part of the Maui field. The liquefaction process for the L.N.G. would also enable the production of big quantities of Liquefied Petroleum Gas (L.P.G.), a proven transport fuel.

The foreign exchange earned through sales of export L.N.G. would increase New Zealand’s purchasing power because of the reduced need to import crude oil.

Preliminary surveys indicated that a site near the Whangarei refinery was preferable to any in Taranaki or other regions of the North Island, the statement said.

“The establishment of an L.N.G. plant could complement, rather than replace smaller proposed projects based on Maui gas such as

the production of methanol or synthetic gasoline, but Shell recommends that the sites of such projects should be chosen to fit in with larger projects such as L.N.G. in the development of an energy plan. “If Shell’s proposals are approved the necessary feasibility study would be commenced immediately, and it is expected that a realistic starting date would be early in 1988.” Shell was basing its proposals on a highly successful Brunei L.N.G. plant which already supplied L.N.G. to Japan, the statement said. Shell was also developing a similar project for L.N.G. with the West Australian Government for use of gas on the North-West Shelf.