1:18 pm today

New Plymouth mayor calls for Labour Party to support gas exploration to 2050

1:18 pm today
New Plymouth mayor Neil Holdom.

New Plymouth mayor Neil Holdom. Photo: RNZ / Robin Martin

  • New Plymouth mayor calls for Labour Party to support oil and gas exploration through to 2050
  • Neil Holdom says energy policy affected by constraints of electoral cycle is not working
  • Holdom wants to see a bipartisan approach taken to energy policy

The mayor of New Plymouth is calling for the Labour Party to commit to supporting oil and gas exploration - both onshore and off - through to 2050.

Neil Holdom, who has a background in the energy industry, says Labour needs to get in behind exploration to help stabilise the faltering energy sector or outline what its strategy is.

"With the issues going on in the energy sector right now it's really clear that we can't have energy policy set by the limit time of electoral cycles.

"I'm really challenging Labour to reach out across the table and work with the coalition to find an energy policy that keeps the lights on and allows the manufacturing sector to keep producing goods to export."

One of New Zealand's biggest gas users Methanex announced it was temporarily shutting its Taranaki methanol plant and selling the gas to power companies Contact Energy and Genesis Energy.

The decision to close until the end of October was expected to have a positive affect on Methanex's books but it was not immediately clear what it meant for its workforce.

"Energy Minister Simeon Brown and Resources Minister Shane Jones have been thrown a hospital pass from the former Labour government with energy rationing for industry seeing both Methanex and our Aluminium Smelter cutting production right now just to keep the lights on while other industries are getting ready to close permanently.

"Electricity spot prices have doubled, we're burning gas and diesel to keep the lights on and businesses across the country are preparing to lay off staff and shut up shop due to soaring energy prices."

Holdom said the former government's decision to "prematurely end oil and gas exploration" had not worked.

"It's clear that is having a massive affect on energy prices right now, but it's also had a chilling affect on investment and their proposal to build Lake Onslow has also chilled investment right across the sector.

"Labour had the view that if they strangled the supply of gas the economy would somehow quickly adapt and ultimately that's not working. The fact we're likely to build an LNG import facility highlights the policy had the wrong objective and has failed."

Energy costs for New Zealand's health and education sectors were rising by $48 million more a year from October 2024 as gas prices soared, he said.

"Schools and hospitals were collectively paying around $22 million a year for gas. From 1 October 2024 they will have to buy from the open market at around $70 million a year for their 1.8 petajoule requirement.

"Forty-eight million dollars a year pays for a lot of teachers and nurses. That money will come out of our education and health budgets for a failed energy policy which has seen gas replaced by imported coal and diesel generation while emissions go through the roof."

The Labour Party had an opportunity in opposition to send a message to manufacturing workers worried about losing their jobs, he said.

"They need to explain to New Zealanders what their policy is around energy, to put their party political objectives to the side and commit to a science-based policy which puts energy security, affordability and jobs for Kiwis front and centre."

The Labour Party has been asked for comment.

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