“I think there is a bigger question regarding climate change - should New Zealand Oil & Gas fossil fuel exploration activities continue at all?
Should the company be investigating alternative options that will align with a low carbon future?
By the time resources come online we are likely to be quite a different world with greater renewable energy resources”
[NZOG Community Panel questions and discussion]
The world is reducing its carbon emissions.
Following the Paris COP21 agreement at the end of 2015, New Zealand’s Government, and regulators and citizens around the world are increasingly committed to initiatives to reduce carbon emissions.
Domestically, recent legislation changes have included New Zealand’s Zero Carbon Act and revisions to the Emissions Trading Scheme, our primary tool to achieve emission reductions.
We expect significant policy action and behaviour change is required to reduce carbon emissions, both domestically and across the world.
We have a positive role to play.
Together oil and gas help to power our current way of life, providing more than half of the world’s primary energy. The transition to low carbon forms of energy will take decades, while new technologies are refined, or even developed, and the costs of new energy sources fall to levels that make them realistic replacements in the energy mix.
The World Energy Outlook produced by the International Energy Agency (IEA) projects significant and rapid growth in a range of renewable technologies. Alongside this the IEA anticipates that oil and gas (as well as coal) remain in the mix in a low carbon future. This includes in the IEA sustainable energy scenario where policy/market mechanisms are in place to meet 1.5 degrees – i.e. a low carbon economy. The IEA expects natural gas will supply a quarter of all global energy demand into the 2030s in all scenarios it models.
We need to provide for our current energy needs during this transition. The challenge we face is how to work smarter and more efficiently, to ensure affordable quality of life and opportunity, while decoupling environmental effects.
With appropriate policy settings the oil and gas industry in New Zealand can continue to develop, making an increasing contribution to our economy and contributing to the global transition off higher-emitting energy sources.
What are we doing?
We recently released our Climate Change Policy. This policy recognises that addressing climate risks is a priority for our generation and will be for those to come.
We have committed to reporting according to the Taskforce for Climate Related Financial Disclosures framework.
We support the transition to clean-burning, low emission natural gas, especially to replace coal in the global energy mix. We have a preference for gas within our portfolio.
We support the New Zealand Emissions Trading Scheme as the primary policy instrument to achieve reductions targets. We support a meaningful price being placed on carbon as the best means to achieve an efficient carbon market that treats all sectors of the economy equally, based on their carbon impact.
We work with other businesses to understand likely climate outcomes and support advocacy for high quality policy outcomes, directly and through our membership of the Business New Zealand Energy Council. We contributed towards the Council’s study of New Zealand’s energy future, and the range of trade-offs and choices that may be needed as patterns of energy use change and disruptive technologies emerge.
We are open about our view of our role in the economy and the role of our products in the energy mix. We work with regulators, industry and others to grow mutual understanding of climate policy issues. We disclose publicly our involvement in any advocacy on climate policy. We inform our community about our stance on the issues and we seek feedback.
We are actively managing our own carbon impact. We have reviewed our approach to flying, ensuring that the only the necessary trips are made. However, the nature of our business does require us to travel a reasonable amount where videoconferencing is not viable. In recognition of this we’ve also made a commitment to offset the emissions from our corporate air travel, initially through the Air New Zealand FlyNeutral programme.