New Zealand to double electric fleet to reduce oil bill

Reuters News
Posted: Oct 27, 2016 7:27 AM

By Jessica Jaganathan and Seng Li Peng

SINGAPORE (Reuters) - New Zealand aims to double its electric vehicle fleet every year through to 2021 to reduce high-cost oil product imports, the country's Minister of Energy and Resources told Reuters.

The Asia-Pacific country spends NZ$9 billion to NZ$11 billion (US$6 billion to US$8 billion) on imports of petroleum, made up mostly of gasoline, against earnings of NZ$2 billion to NZ$2.5 billion from crude oil exports, said Simon Bridges, who is also the Minister of Transport.

"The prospect of going from imported fossil fuels, which cost the country a lot of money, to homegrown clean, green energy is incredibly tantalizing," Bridges said, speaking on the sidelines of Singapore International Energy Week, an annual industry conference.

"We have a target of doubling our electric vehicles every year to 2021 ... effectively from nothing to over 2000 today," said Bridges, adding that despite an increase in distances driven, no significant hike in petroleum demand was expected.

New Zealand also has a target of having 90 percent of its electricity produced from renewable energy such as wind and geothermal sources by 2025, up from 83 percent currently.

The country, with a population size of over 4 million, is also looking to market its untapped oil and gas reserves, Bridges said.

It is looking to offer a new block for petroleum exploration, which includes over 500,000 square kilometers of onshore and offshore acreage. The final block offer will be announced in March, next year, he said.

"We have got one mature basin in New Zealand called Taranaki and all of the exports out of the NZ$2.5 billion per annum has been great, but there are 17 other basins around New Zealand and we know they're prospective," he said.

Still, with the drop in oil prices - still less than 50 percent of mid-2014 values - drilling has come to a halt.

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"We've got no drilling this summer ... New Zealand isn't changing course when it comes to oil and gas exploration and production. We think it's good for our economy, but it's also the world's transition to low carbon economy," said Bridges.

Any natural gas found would also be a great boost to the Asia-Pacific region, he said.

New Zealand has one refinery which supplies 70 percent of the domestic market's petrol, 84 percent of the diesel, 83 percent of the jet fuel and 100 percent of the fuel oil, said New Zealand Refinery Company's website.

(Reporting by Jessica Jaganathan and Seng Li Peng; Editing by Tom Hogue)