Govt’s carbon capture policy to lead to more gas emissions

The Government’s new regulatory regime for carbon capture and storage will incentivise new offshore gas production and ultimately lead to more emissions from the petroleum industry, officials have found.
In an assessment of the climate implications of the policy, which is part of the Government’s approach to emissions reductions, officials found 1.3 million tonnes of greenhouse gas would be sequestered during gas production, but 1.4 million tonnes would be emitted due to the increased production from the Māui East gas field.
Outside of gas production, the policy was expected to have a net positive effect on reducing emissions, leading to 1.2 million tonnes avoided from geothermal plants and 3.3 million tonnes prevented from Methanex by 2035.
“Maui East, which started production at the end of 2023, will produce gas that otherwise would not have been produced without [carbon capture],” officials wrote. According to field owner OMV, Māui East is not yet producing but was appraised last year.
Energy Minister Simeon Brown said the policy was still worthwhile because New Zealand needed more gas and it would have an overall positive impact on the climate.
“As we have seen in recent weeks, natural gas plays an important role in New Zealand’s energy security and is the natural partner to enable our largely renewable electricity system when the lakes are low, the sun isn’t shining, and the wind isn’t blowing,” he said.
“Carbon capture and storage can potentially lower the net cost of producing gas, adding to our energy security, while also increasing the range of options that New Zealand has to achieve emissions goals.”
But 350 Aotearoa campaigner Adam Currie said it showed carbon capture was a pipe dream.
“We’ve seen $6 billion invested in carbon capture and storage over the last year. It’s been around for decades, with billions invested around the world, and it’s never worked. It’s no surprise that officials don’t think it’s going to reduce emissions here either,” he said.
“You look at [Australian gas field] Gorgon, for example, the world’s biggest CCS venture, emissions have risen 50 percent. Despite getting approvals based on burying 4 million tonnes of carbon a year, it’s now capturing less than half of that and emitting another 8 million tonnes on top.”
Carbon capture has long been utilised in the fossil fuel industry, but primarily as a tool for producing more oil by re-injecting carbon into declining wells to force the oil out. Climate scientists have argued this isn’t a climate solution, because it leads to the production of more fossil fuels than otherwise.
“The argument in favour of enhanced oil recovery is often that if they weren’t using this captured CO2 they’d be using some other CO2. But I don’t think you can call anything where you’re getting more oil out of the ground to burn a climate solution,” David Ho, a professor in oceanography at the University of Hawai’i, told Drilled in July.
According to the Institute for Energy Economics and Financial Analysis, “not one single CCS project has ever reached its target CO2 capture rate”.
Officials at the Ministry of Business, Innovation and Employment said CCS would capture 100 percent of emissions from the Kapuni and Māui East fields. The institute, however, said no existing project has consistently captured more than 80 percent of carbon. Its review of five natural gas fields found capture rates ranged from 10 to 78 percent.
“We’ve got a wealth of evidence about how useless CCS has been,” Green Party energy spokesperson Scott Willis said. “We should not try and excuse our prolific use of fossil fuels through using unproven – or proven to be ineffective – technology.”
Megan Woods, the Labour Party’s energy spokesperson, said the policy was simply an excuse to use more gas.
“There’s a reason why, globally, the oil and gas industry are such champions of CCS and it’s because it allows them to have their cake and eat it. What this really lays clear is that we cannot see CCS as a policy that is going to help decrease our emissions when it comes to gas.”
She added that the findings underscore the importance of requiring policies to undergo a climate vet, which was added under the previous Labour government.
Both Willis and Woods said the use of the technology to reduce emissions from geothermal power was already proven and should go ahead. Last year, the Ngāwhā power station became the country’s first zero emissions geothermal generator when it equipped carbon capture technology.
“Geothermal is already sorted. They’re already doing it. There’s no real problem there,” Willis said. He said the policy was therefore clearly designed to keep New Zealand hooked on fossil fuels.
“It’s hard to know whether this Government is simply gaslighting us or whether they just engage in magical thinking as a practice,” he said.
“We have a wealth of energy solutions at our fingertips that we could employ right now that we’re not doing. The Government’s simply looking to continue with gas.”