Methanex Asia-Pacific vice-president Bruce Aitken told EnergyReview.Net that its experts, Gaffney Cline, believed there was further gas accessible in the southern part of the two-lobe Maui field.
The Methanex submissions to the Maui independent expert, Netherland Sewell and Associates International, would include information supporting this position and Methanex was hopeful of a positive outcome, which incorporated upside gas reserves in the re-determination.
"This is not idle optimism; there is an argument that there are more economic reserves in Maui, which would make a huge difference to us."
Aitken declined to comment on how much extra gas might be within the Maui mining licence, though industry commentators say up to 400PJ or more gas could be recoverable.
Earlier this year Methanex withdrew its High Court proceedings against MDL and the Crown after the Maui gas contract parties agreed to the Maui redetermination expert deciding the inadequacy of information provided to the users, as well as the level of remaining gas reserves.
Aitken conceded Methanex could always be outbid for long-term Pohokura gas contracts by electricity generators, but would be very interested in accessing any additional gas within the Maui mining licence. Methanex would be a very good user of any test or off-spec gas from the 1tcf Pohokura field during its development, which is scheduled to come onstream from early 2006.
"The years 2004 to 2008 hold the most concern for us regarding our ability to continue to operate in New Zealand, with the next two years being critical,
though I am confident more gas will be found which will enable us to keep our plants operating or to restart them later this decade."
Methanex planned to run the large two-train Motunui complex and the smaller single-train Waitara Valley plant at near full capacity next year, though full or partial shutdowns were likely after that.
Methanex NZ had the capacity to operate with anything from 20PJ to 90PJ of gas per annum. "It's not too difficult to shut down and restart, and it would make sense to do that for perhaps four or five years.
Aitken said there was a wide range of outcomes regarding the Maui redetermination. A best-case scenario, with no reduction in remaining recoverable reserves, could mean business as usual for Methanex until the contracted 2007. However, the worst case would mean reduced gas offtakes from 2003.
He conceded the $NZ10 million November shutdown of the Waitara Valley plant, timed to roughly coincide with a Maui maintenance program, could be its last scheduled maintenance turnaround.
MDL chairman Lloyd Taylor recently told EnergyReview.Net that there were no more economically recoverable reserves within Maui.
However, it is known that last decade MDL discussed with Methanex, Natural Gas Corporation and the then government-owned ECNZ about the possibility of exploring and perhaps developing new prospects within the Maui licence.
MDL wanted any additional economic gas to be subject to a fresh, and more expensive, sales contract, but the big three gas users said they were not prepared to pay higher gas prices and that extra gas should be covered under the existing Maui sales contracts.
Commentators say there are likely to be new areas within Maui which could yield commercial prospects, such as Maui North East and Maui South, but that industry politics will prevent these from being exploited until the present Maui contracts have expired.
Aitken said Methanex was realistic about its future in New Zealand. "If it is proven there is a genuine shortage we will be the first to exit from future bidding for new gas. Electricity generators will always be able to outbid us."
He added that this complete uncertainty was difficult for New Zealand Methanex staff. "The people in Taranaki don't know how long their jobs will last. We have a retention scheme in place but, in the event there is no more gas, there are only certain things we can offer our staff."
However, it was too early to talk about Methanex leaving New Zealand. "I still think it's premature to talk about exiting, though it's probable we will lose some capacity."
Recent industry rumours have the other parties to the Maui gas supply contracts informally agreeing to the orderly exit of the Canadian-headquartered corporation. "It would be in everyone's interests to help Methanex leave in an orderly fashion," said one commentator.
Aitken denied knowing of such rumours, but said Methanex was working co-operatively with field owner Maui Development and the other two big users, Natural Gas Corporation and Contact Energy, though the government could certainly play a more pro-active role.
"Given the critical role Maui plays, the Crown should be playing a leadership role and should be worried about how to build a sustainable gas industry, rather than retreating to its legal position."
It was important to remember that Methanex played an important role in the overall New Zealand exploration equation. "It's a rare month that we do not have an exploration company asking us about our future capacity, our future plans," he concluded.
