Shell NZ counsel Nick Hodson has called for immediate government action on the Maui pipeline - this country's largest pipeline which goes from the onshore Maui production station at Oaonui to Rotowaro just south of Huntly.
He said the Maui gas contracts needed urgent updating so multiple customers could use the pipeline to transport gas from a number of fields northward. Usually infrastructure owners were reluctant to let third parties use their infrastructure, but Shell - part owner of the Maui pipeline - wanted a more open access regime.
It was in the interests of the whole energy industry that there be a change in how the Maui pipeline was used, he added.
Shell NZ chairman Lloyd Taylor, who is also Maui Development Ltd chairman, told EnergyReview.Net today that MDL was constructively engaged with stakeholders progressing the open access regime. "We're not aware of any intransigence. However, time is of the essence, and things need to be resolved and agreed within the first half next year at the latest, so as to permit timely investment decisions to be made."
Last November Taylor said the speedy development of the Pohokura gas-condensate field off north Taranaki hinged on new parties and new gas gaining access to the Maui pipeline.
The $NZ900 million Pohokura gas project, now due to come on stream from late 2005-early 2006, did not warrant the construction of a separate pipeline from Taranaki to Auckland. Therefore access to the Maui pipeline was vital.
The Pohokura (PEP 38459) partners - Shell New Zealand, Todd Energy and Preussag Energie - needed certainty of gas contracts and the ability to transport gas from the 1tcf-plus field to their respective buyers in the large and growing Auckland, Waikato and Bay of Plenty regions, added Taylor.
The Maui contract specifies that only Maui gas is to be delivered through the Maui pipeline and no other gas can be put into the pipeline until the contract terminates in 2009, or earlier by the agreement.
The terms of the contract require all parties to agree to any changes. This means the consent of not only Shell, Todd and the soon-to-be-announced new 10% partner in Maui, but also the blessings of Contact Energy (which has entitlements to about 40% of Maui gas), methanol manufacturer Methanex Corporation, Natural Gas Corporation and the Crown (through Treasury) is necessary.
Industry commentators say third-party access may be a complex matter to resolve, with the different parties having different priorities. "There is definitely no guarantee that the Pohokura partners will be able to access the Maui pipeline before the end of the Maui contract," said one commentator recently.
Maui is expected to run out 2 years earlier, at current contracted offtake rates, than the originally expected mid-2009.
