On January 10, between thirty and forty peaceful yet noisy protestors rallied outside of TAG Oil's office in New Plymouth, New Zealand. One of their signs read: 'No Fracking Way!' The crowd chanted to the tune of "hay – hay ho – TAG Oil's got to go." All of them were angry and fearful about its plans (already approved by the government) for drilling within 350 meters of Egmont National Park, a beautiful and pristine landscape. Assuming the worst, many Kiwis (citizens of New Zealand) seem to think TAG Oil will ruin their food basket and pollute their waterways, leaving a barren wasteland behind for generations to come.
Green, clean, and safe
On one hand, pro-environment and sustainability, New Zealand's government would like for 90% of its power to come from renewable energy by 2025. Towards this end, the country invested $500 million to build the Ngatamariki Geothermal Power Station (some locals were nervous about this too), the largest singular binary power plant in the world. Designed and built by Ormat Technologies, the 100 MW plant started operating in 2013, and it's running great! Geothermal power from this plant generates enough electricity to power 80,000 homes. That's quite a few in a country of just over four million people.
Black, dirty, and risky
Promoting renewable energy on one hand, New Zealand's government is also encouraging oil exploration and development on the other. In the years and decades to come, they will be walking a fine line between boosting tax revenues via energy exports to Australia, Asia, and Europe, and simultaneously protecting the environment and tourism.
Believing that billions of barrels worth of oil are trapped within New Zealand's Taranaki, Canterbury, and East Coast Basins, oil firms such as TAG Oil, Royal Dutch Shell (NYSE:RDS.A), and Anadarko Petroleum (NYSE:APC) are interested in staying awhile. It's unlikely that angry protesters will be able to scare them out of the country before hitting it rich, or striking out.
Boat loads of gas
Last week, Reuters reported that Shell was leading an exploration project to look for natural gas off the southeast coast. Rob Jager, Shell's head guy in the country indicated that any finds would likely be processed on a floating facility (juggling liquids at sea), then exported because of the small domestic market. In other words, New Zealand doesn't need the gas as much as Shell does. Nervous Kiwis will have plenty of time to refine their protesting strategies, because Shell's drilling campaign isn't expected to start until 2016.
We promise to be extra careful
Anadarko has said the opportunity to operate there is a privilege, and it is dedicated to protecting the natural beauty of New Zealand. However, not all New Zealanders aren't taking Anadarko at its word. Perhaps Anadarko's involvement with the Deepwater Horizon blowout in the Gulf of Mexico gives Kiwi's legitimate cause for concern.
Shortly after leaving TAG Oil's office, protesters by the hundreds (some in kayaks) paddled out into the bay to express their anti-drilling sentiment yesterday. Anadarko is in the process of sending deep-sea rigs off the coast of Raglan; exploratory drilling is expected to begin there (Taranaki and Canterbury Basins) next month. Anadarko plans to drill at least two wells, but protesters have vowed to hinder its efforts.