“This government is well aware of the importance of oil to our economy. Petroleum, particularly gas, has a vital role to play in the future energy mix of this country,” he said when opening the 2005 New Zealand Oil & Gas Expo in New Plymouth yesterday.

“Gas provides considerable comparative economic and environmental benefits as a primary fuel for the production of electricity and for the various processing industries that depend on reliable, low cost energy,” Duynhoven said.

There has been a lot of debate in NZ over the prospect of importing LNG if local explorers failed to find sufficient replacement reserves to offset declining domestic gas production.

But Duynhoven said international price movements and changing patterns for global supply and demand for LNG suggested imports may not deliver gas at a competitive rate.

That was partly the reason the government was committed to domestic gas as the first option to solve this country’s looming gas supply-demand gap.

Recent government initiatives to accelerate exploration activities and the discovery of new gas reserves – including reducing the royalty rates for new gas finds and providing new seismic data free of charge – had reduced overall risk for explorers in New Zealand.

But the government was also expecting explorers to speed up their exploratory work and to honour work program commitments.

“The message is clear – aggressive work programs are required from explorers with proven technical and financial capabilities and capacity to accelerate exploration and discovery of petroleum,” Duynhoven said. “In short, explorers need to ‘use it or lose it’.”

Duynhoven said the government was accelerating its own activities, with bids for three new blocks offers – offshore Northland, outer Taranaki and offshore East Coast – scheduled to close either in December or next February.

And, over the next 12 months, Crown Minerals planned at least four other offers, also featuring free seismic data packages. Details of these blocks offers and data packages were planned to be announced next March at the 2006 New Zealand Petroleum Conference.

Over 60 companies and organisations exhibited at the two-day expo – the biggest yet held in New Plymouth by Perth-based Swan Exhibitions – and spokesperson Eileen Wolfe said the size of this year’s event was a reflection of the vibrant state of New Zealand's energy sector.